The Brisbane-based company today reported a loss of $4938 for the half-year ended December 31, 2006, down from the moderate profit of $379,771 in the previous corresponding period.

The loss was driven by higher exploration costs, predominately from its acquisition of offshore exploration acreage in the North Sea.

Despite the profit drop, Sunshine said its achievements throughout the period have provided an “excellent platform” for achieving commercial production in the next 12 months.

Managing director Tony Gilby said he was pleased with the company’s achievements during the period, which had established the foundations for its “growth maximisation” program.

“Our task for 2007 is to dramatically accelerate our growth to take advantage of the major expansion opportunities within the industry,” he said.

“This growth maximisation program is designed to build shareholder wealth by establishing certified reserves and then bringing forward revenues.”

Gilby said to achieve this, Sunshine’s focus in the second half remains on advancing its coal seam methane Lacerta project in Queensland towards proved and probable (2P) reserves to support commercial gas supply contracts.

Sunshine announced in January that Lacerta would be the focus of a $5.37 million work program of 26 wells during the March quarter.

As part of that program, the Lacerta-7 pilot well has now begun production testing and Lacerta-5, 6 and 8 are due to shortly start production testing following completion of civil works.

In addition to Lacerta, Sunshine said it will also focus on its 100%-owned Overston conventional gas project, also in Queensland.

During the half year, the company entered into a non-binding agreement with major Japanese trading house Sojitz. Reaching a binding agreement with Sojitz will depend on certification of 2P reserves, it said.

“We have achieved a lot in less than five years since listing on the ASX and we now have the potential to achieve a great deal more,” Gilby said.

He said over the next 12 months, Sunshine would focus on generating revenue and building shareholder wealth.

“Based on the new industry dynamics and what we have achieved in a short period of time, we believe Sunshine is now well positioned to experience strong growth well into the future,” he said.