Trading update for the year
ended 31 December 2023
31 January 2024 - Singapore: Jadestone Energy plc
("Jadestone", the "Group" or the "Company"), an independent
upstream company focused on the Asia-Pacific region, provides a
trading update for the year ended 31 December 2023. The financial
information in this update has not been audited and may be subject
to further review and change.
Highlights
·
Record annual Group production for 2023 of 13,813
boe/d, representing c.20% year-on-year growth.
·
Net debt of c.US$4.2 million and available
liquidity of c.US$220 million at 31 December 2023.
·
The Akatara development project is c.93% complete,
with first gas and final acceptance of the Akatara Gas Processing
Facility remaining on schedule for the second quarter of
2024.
·
All conditions precedent for the CWLH 2
acquisition have been satisfied, with the acquisition expected to
close in mid-February 2024.
Paul Blakeley, President and CEO commented:
"We delivered 2023 operating and financial performance in line
with guidance, finishing the year strongly with robust production
performance from both Montara and PM323 in particular. We further
diversified our business through the Sinphuhorm acquisition and the
increased interest in the CWLH fields, as well as making
significant progress towards first gas at Akatara.
2024 is set to be a very important year of transition for
Jadestone, with production expected to grow by c.55% year-on-year
driven by first gas at Akatara, higher volumes from Malaysia and
the completion of the CWLH 2 acquisition, all in turn adding
significant diversification to our business. Akatara remains
on track for first gas in the second quarter of this year,
maintaining great progress against the challenging fast-track
schedule established at project sanction. CWLH 2 is expected to
close in mid-February now that all conditions precedent have been
met. Further growth beyond 2024 continues to be de-risked, through
recent infill drilling success in Malaysia and, most notably,
through last week's signature of a heads of agreement for Vietnam
gas sales.
The small end-year 2023 net debt position was achieved despite
record levels of investment in Jadestone's business, including the
highest annual capital expenditure in Jadestone's history. We will
continue to manage our investment and expenditure with the aim of
minimising leverage and maximising
liquidity."
2023 Operating Performance[1]
|
|
FY 2023
|
FY 2022
|
Production
|
|
|
|
Group production
|
boe/d
|
13,813
|
11,487
|
- Montara
|
bbls/d
|
3,655
|
4,227
|
- Stag
|
bbls/d
|
2,672
|
2,176
|
- CWLH (existing interest)
|
bbls/d
|
1,896
|
383
|
- Peninsular Malaysia
("PenMal")
|
boe/d
|
4,288
|
4,702
|
- Sinphuhorm
|
boe/d
|
1,303
|
n/a
|
Liftings
|
|
|
|
- Oil
|
mmbbls
|
3.6
|
4.0
|
- Gas
|
mmcf
|
1.4
|
1.8
|
Group production for 2023 of 13,813
boe/d represented 20% growth year-on-year and an annual record for
Jadestone, driven by a full-year of production from the existing
interest in the CWLH fields, approximately 10 months of Sinphuhorm
production and an increase at Stag following the successful infill
drilling campaign in late 2022. This was offset by a reduced
contribution from Montara due to the shut-ins during 2023 for tank
repairs and natural decline at the PenMal assets, albeit with both
Montara and PenMal performing strongly into the end of the year.
2023 production was just above the top end of the implied annual
2023 guidance range of 12,600-13,700 boe/d (based on issued
guidance from April - December 2023 of 13,500-15,000
boe/d).
Oil liftings were lower
year-on-year, primarily due to the shut-ins at Montara. Gas
liftings were lower due to natural declines at the PM329 asset
offshore Malaysia.
2023 Financial Performance[2]
|
|
FY 2023
|
FY 2022
|
|
|
|
|
Average oil price realisation
|
US$/bbl
|
87.4
|
103.9
|
- Brent
|
US$/bbl
|
81.8
|
96.0
|
- Premium
|
US$/bbl
|
5.7
|
7.8
|
|
|
|
|
End-year inventory/lifting position
|
|
|
|
- Montara and Stag
inventories
|
Bbls
|
211,261
|
94,989
|
- CWLH and PenMal net
overlift
|
Boe
|
141,618
|
216,813
|
|
|
|
|
Revenues
|
US$
million
|
319.8
|
421.6
|
Total production costs
|
US$
million
|
256.6
|
219.9
|
- Underlying operating
expenses
|
US$
million
|
175.5
|
157.2
|
- Other costs[3]
|
US$
million
|
81.1
|
62.7
|
Capital expenditure
|
US$
million
|
117.0
|
82.9
|
Net cash/(debt) at 31
December
|
US$
million
|
(4.2)
|
123.3
|
The average oil price realisation
for 2023 was impacted by the year-on-year decline in Brent prices,
with the average premium to Brent for liftings broadly mirroring
the fall in Brent oil prices. Revenues in 2023 reflect the trends
in liftings and realisations highlighted above, and an expected
outflow of US$10.3 million related to Q4 2023 oil price
hedging.
Overall, 2023 production costs of
US$256.6 million were towards the lower end of the 2023 guidance
range of US$245-285 million (split between underlying operating
expenses of US$180-210 million and US$65-75 million of
non-recurring items and costs not associated with production (such
as well workovers and transportation).
Total production costs increased by
c.US$37 million year-on-year, largely explained by higher workover
activity and tanker costs at Stag (+US$16 million), a full-year of
production at CWLH (+US$14 million), shuttle tanker operations at
Montara (+US$14 million) and a charge relating to decommissioning
activity on the Company's formerly non-operated interests offshore
Malaysia (+US$13 million), offset by lower supplementary charge
payments in Malaysia (-US$15 million). The 2023 production cost
disclosures above are preliminary, subject to review and change,
and do not include any impact from the change in inventory and
lifting position over 2023.
2023 capital investment of
c.US$117.0 million was at the midpoint of the guidance range of
US$110-125 million, with c.US$83 million spent in Indonesia on the
Akatara development, c.US$28 million on the East Belumut drilling
campaign in Malaysia with the remainder comprising minor investment
activity across several assets.
Net debt of US$4.2 million at 31
December 2023 reflects c.US$153 million of consolidated Group cash
balances (restricted and unrestricted cash) and c.US$157 million of
debt drawn at end-2023 under the Company's reserves-based lending
("RBL") facility.
Available liquidity at year-end 2023
totalled c.US$220 million, reflecting unrestricted cash balances,
undrawn RBL balances (based on the current borrowing base) and the
undrawn working capital facility.
The Group's 2024 production,
operating costs and capital expenditure guidance remain unchanged
from the announcement on 15 January 2024:
l Production:
20,000 - 23,000 boe/d, a c.55% increase on 2023 at
the midpoint.
l Operating
costs: expected to total US$240-290
million (excluding forecast royalties and carbon taxes totalling
c.US$30 million), essentially flat year-on-year on a comparable
basis and which would represent a c.30% year-on-year reduction on a
unit cost basis due to increased production of lower cost
barrels.
l Capital
expenditure: expected to total
US$80-110 million.
l Other cash
expenditure: expected to total
c.US$77 million on a net basis, primarily relating to the
abandonment trust fund payments associated with the CWLH 2
acquisition. These are expected to be largely funded through
revenues from the next two liftings attributable to the CWLH 2
interest.
Akatara Update
The Akatara development project is
currently 93% complete. Approximately 1,850 workers are currently
on site, with c.4.7 million safe manhours for the Akatara project
worked to date.
First gas and final acceptance of
the Akatara Gas Processing Facility remains on schedule for the
second quarter of 2024.
Construction of the sales gas
pipeline is approximately 93% complete, including all canal
crossings.
The workover of the Akatara-B2 well
was successfully completed in mid-January 2024, with the Akatara-A4
well workover in progress. The workover programme on the five
existing wells, which will provide the raw gas feed into the
Akatara Gas Processing Facility, is expected to complete by
end-March 2024.
CWLH 2 Acquisition
The Company is pleased to announce
that all conditions precedent to the CWLH 2 acquisition, originally
announced in November 2023, have now been satisfied. As a result,
the acquisition is expected to close in mid-February
2024.
Malaysia Licence Award
As part of the recent Malaysia Bid
Round, Jadestone was awarded the PM428 PSC as operator with a 60%
interest, with the joint venture partner being Petronas
Carigali.
The PM428 PSC represents potential
upside in the event that Jadestone is successful in its application
for the Puteri Cluster (previously known as the PNLP assets), since
it not only surrounds the Puteri Cluster, but is also in close
proximity to the Jadestone operated PM323 and PM329 PSCs. The PM428
award carries a minimal financial commitment to reprocess some
existing seismic. A decision on the Puteri Cluster is expected
around mid-year 2024 as part of the Malaysia Bid Round
Plus.
-ends-
For further information, please
contact:
Jadestone Energy plc
|
|
Paul Blakeley, President and
CEO
|
+65 6324 0359 (Singapore)
|
Bert-Jaap Dijkstra, CFO
Phil Corbett, Investor Relations
Manager
|
+44 (0) 7713 687467 (UK)
|
|
ir@jadestone-energy.com
|
|
|
Stifel Nicolaus Europe Limited (Nomad, Joint
Broker)
|
+44 (0) 20 7710 7600 (UK)
|
Callum Stewart
|
|
Jason Grossman
|
|
Ashton Clanfield
|
|
|
|
Peel
Hunt LLP (Joint Broker)
|
+44 (0) 20 7418 8900 (UK)
|
Richard Crichton
|
|
David McKeown
Georgia Langoulant
|
|
|
|
Camarco (Public Relations Advisor)
|
+44 (0) 203 757 4980 (UK)
|
Billy Clegg
|
jse@camarco.co.uk
|
Georgia Edmonds
Elfie Kent
|
|
About Jadestone Energy
Jadestone Energy plc is an
independent oil and gas company focused on the Asia-Pacific
region. It has a balanced and increasingly diversified
portfolio of production and development assets in Australia,
Malaysia, Indonesia, Thailand and Vietnam, all stable jurisdictions
with a positive upstream investment climate.
Led by an experienced management
team with a track record of delivery, who were core to the
successful growth of Talisman Energy's business in Asia-Pacific,
the Company is pursuing a strategy to grow and diversify the
Company's production base both organically, through developments
such at Akatara in Indonesia and Nam Du/U Minh in Vietnam, as well
as through acquisitions that fit within Jadestone's financial
framework and play to the Company's strengths in managing maturing
oil assets. Jadestone delivers value in its acquisition strategy by
enhancing returns through operating efficiencies, cost reductions
and increased production through further investment.
Jadestone is a responsible operator
and well positioned for the energy transition through its
increasing gas production, by maximising recovery from existing
brownfield developments and through its Net Zero pledge on Scope 1
& 2 GHG emissions from operated assets by 2040. This strategy
is aligned with the IEA Net Zero by 2050 scenario, which stresses
the necessity of continued investment in existing upstream assets
to avoid an energy crisis and meet demand for oil and gas through
the energy transition.
Jadestone Energy plc (LEI:
21380076GWJ8XDYKVQ37) is listed on the AIM market of the London
Stock Exchange (AIM: JSE). The Company is headquartered in
Singapore. For further information on the Company please
visit www.jadestone-energy.com.
This announcement does not contain inside
information.
Glossary
bbl
|
barrel of oil
|
bbls/d
|
barrels of oil per day
|
boe
|
barrel of oil equivalent
|
boe/d
|
barrels of oil equivalent per
day
|
CWLH
|
Cossack, Wanaea, Lambert, and
Hermes
|
mmbbls
|
million barrels
|
mmcf
|
million cubic feet of gas
|
PSC
|
production sharing
contract
|