Streitberg told a CorporateFile.com.au open briefing he expected this sales boost to follow a potential success at the Tarantula field and its newly signed contract with Western Power.
“Overall we expect gas sales revenue to be up substantially – particularly if the Tarantula field performs as we expect,” he said.
The Tarantula-1 S1 exploration well, in which Arc holds a 33% interest, was recently reported to contain the largest recorded flow rate in onshore Australia. Streitberg said joint partner Origin Energy would start production testing in the near future, which was expected to produce quantifiable answers in the next two months.
“It could easily allow us to double our gas production if the reserves come in at the high side,” he said.
“There’s a very strong demand for Perth Basin gas – we’ve had lots of approaches from customers and we could double the business tomorrow if we had the gas to sell.”
Streitberg also referred to the extended sales contract with Midland Brick and the signing of a new gas sales contract with Western Power, which he said gave Arc access to both peaking load requirements and gas customers on the Dampier-to-Bunbury gas pipeline.
“It has enables us to be much more flexible with supply,” he said.
Arc also started replacing third party backup gas with gas produced from their own fields last year, meaning Arc now had a full year of production up its sleeve, said Streitberg.
Meanwhile, Streitberg attributes Arc’s recently posted net profit increase of 104% to $41.1 million for last financial year, to both its higher oil revenue, up 75%, and higher gas revenue, up 37% - helped in part by high world prices.
While Arc did not pay a dividend this year, Streitberg said it would consider this prospect in the future, although unlikely to happen inside the next 12 months.
He said main capital expenditure would be spent developing infrastructure at the Jingemia field.
Originally projected with an upside of 15 million barrels, Jingemia’s recent evaluation and appraisal has reduced this reserve estimate to 7.3 million, said Streitberg.
“Our production budget for this year is at least 5000 barrels a day for Jingemia and we see that as easily achievable with the current development program,” he said.
Of the Arc and Voyager merger, expected for completion on September 21, Streitberg said the integration had been “seamless.”
“All Voyager staff accepted redundancies and John Begg will work for Arc as a consultant,” he said.
