He said the company delivered solid production and an enviable run of exploration success with five new discoveries over the past quarter and a 71% success rate during its 2014-15 conventional drilling program.

"In particular, our wet gas drilling campaign with Santos in the Western Cooper, in which we are free carried, has resulted in five discoveries from the first six wells," Lingo said.

Pad drilling at the Bauer field on the Western Flank has been a success. In addition, the expansion of the Bauer central fluid handling facilities to 75,000 barrels of oil per day Drillsearch remains on track to deliver its production guidance, albeit at the lower end of the 3-3.2 million barrels of oil equivalent due to delays to the completion of facilities and the connection of new wells.

Quarterly production of 670,000boe was 15% lower during the December quarter as a result of later-than-expected connection of the first Bauer pad wells, largely blamed on the Cooper's infamous wet weather.

Production increased to 11,850bopd in April from the Western Flank with the hook-up of Bauer-19.

Average realised oil prices fell to $69.90/bbl, down from $91.50/bbl, due to a revenue drop before hedging of 35% to $43.7 million (a combination of lower production and weaker oil prices).

Gains from the hedging program equated to a further $19.50/bbl, or $11.6 million of additional income, during the quarter.

Capital expenditure has been halved as the company focuses on near-term production and cash flow, as well as on reserves replacement, with higher priority given to the conventional oil and wet gas businesses.

The Flax field, only recently returned to production, has been suspended and all wells have been shut in. The mothballing of the facilities and camp complex also continued into the June quarter, with Drillsearch deferring its Northern Cooper program in favour of the second Bauer pad drilling campaign and the Ralgnal-1 exploration well in the Western Cooper.

Ralgnal-1 flowed at 5.88 million cubic feet from the Tirrawarra Sandstone and has been suspended as a new discovery.

The unconventional program with BG in ATP 940 has also been scaled back.

Production testing of both Charal-1 and Anakin-1 was conducted during the quarter with Charal-1 recording a peak flow rate of 950,000 cubic feet per day and Anakin-1 recording a peak flow rate of 1.05MMcf/d. Both wells have now been shut in to monitor pressure build-up with little additional work expected in the near term.

One-third of Drillsearch's staff has been retrenched as part of an initiative to achieve annualised savings of $10-$15 million.