Beach Energy reduces full-year production guidance
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The news: Beach Energy has reduced the top end of its full-year production guidance, after its March quarter results were "overshadowed" by a delay to contribution of its Waitsia Gas Plant in Western Australia and weather-related impacts to production.
The numbers: Full-year production guidance was revised from 18 million to 20 million barrels of oil equivalent (MMboe) to 18 MMboe to 18.5 MMboe.
In the March quarter, Beach recorded production of 4.5 MMboe, unchanged compared to the prior corresponding period, and up 4% quarter on quarter.
However, sales volumes of 4.8 MMboe represented a 21% drop compared to the previous quarter, with sales revenue of $392 million down 28%. Realised oil price also dipped 2% to $141 per barrel compared to the December quarter.
While the company did not change its capital expenditure guidance, it said it would be towards the upper end of the $900 million to $1 billion range.
The context: Beach CEO Brett Woods said the ongoing emergence of quality issues at Waitsia during its pre-commissioning phase, which saw the company's shares plunge on the ASX earlier this month, was "disappointing" and "overshadowed" the quarterly results.
However, a drilling campaign in the Perth Basin during the quarter saw three gas discoveries and one gas development well, which Woods viewed as an "encouraging outcome which will provide valuable backfill volumes."
Elsewhere, Woods said the company's strategic review is "progressing well" and its outcomes will be communicated before the end of this financial year. Beach is "on track" to deliver the 30% headcount reduction announced in March, with more than 20% of roles to be cut by the end of April.
The source: ASX announcement
