Tap's managing director, Paul Underwood, said "Tap's record earnings were driven by a record six monthly liquids production of 1.32 million barrels of oil or 7,174 barrels per day net to Tap."

"In addition, gross operating margins for the period were maintained at around 65% due to ongoing strong oil prices (A$44/bbl) and increased liquids production over relatively fixed costs."

"This result was achieved despite a write down in capitalised exploration expenditure of $1.8 million ($1.3 million after tax) and an unrealised foreign exchange loss of $3 million for the period, resulting from US dollars held on deposit," said Underwood.

"Record cash flows from operations of $47.9 million increased Tap's cash balances from $7.8 million at 30 June 2003 to $37.9 million at 31 December 2003."

Underwood added that the result also highlights a number of new development projects that are progressing and expected to contribute to future oil and gas production.

"The Linda gas/condensate field development is in progress and should be on-line by April 2004 and the Harriet gas plant capacity on Varanus Island is in the process of being doubled."

"The Kahili gas/condensate field development in New Zealand should also be on-line by mid Year," he added.

The company is also about to embark on what it calls a potentially high impact exploration and appraisal drilling program for 2004.

"Tap plans to spend around $25 million on exploration this year, with around 20 wells planned for Australia and New Zealand."

"The Harriet JV and Airlie Island acreage remains highly prospective for near term production increments with numerous wells scheduled and in planning. The existing producing Woollybutt Oil Field also has potential for upside should the step-out well planned for mid-year be successful," said Underwood.