The Melbourne-based oil and gas production company yesterday delivered a net profit of $1.54 million, including a non-recurring item, swinging from a loss of $5.21 million in 2004-05.

Excluding this item, Orchard’s net loss in 2005-06 was $3.08 million.

Revenue from continuing operations jumped to $3.34 million in 2005-06, up from $770,625 in 2004-05.

Orchard said this was mainly due to increased oil and gas production from its South Belridge and Forbes gas projects and an increase in the fees the company receives for being operator of some of its joint ventures.

“We continued to deliver the company’s strategic direction of building a strong and growing oil and gas company focused on opportunities in the Sacramento and San Joaquin Basins in California,” executive chairman Steve Graves said.

“The achievements in 2005-06 have enabled Orchard to transition from a pure exploration company, with an extensive slate of exploration prospects, to an explorer, developer and producer, generating revenues from the South Belridge and Forbes projects.”

Orchard said highlights of the 2005-06 financial year included:

• Nine wells successfully completed and Orchard’s first oil and gas production starting at the South Belridge and Forbes gas projects with over 85% of these projects’ capital expenditures funded by Orchard’s project partners;

• Orchard’s first independent audit of reserves totalling 6.8 million barrels of oil equivalent (MMboe) for its share of proven and probable reserves and 19.3MMboe for its share of proven, probable and possible reserves at the South Belridge project, which was announced in August;

• The signing of new agreements at the South Belridge and Southeast Lost Hills projects with existing partners, which have enhanced Orchard’s position on an asset, operating and financial basis; and

• The announcement of six new projects with global oil and gas companies resulting in an increase in acreage and exploration prospects.

Orchard also said it had a new $US27 million ($A35.8 million) 20-well drilling program planned for the new financial year.

Under the campaign, 10 wells are scheduled for the South Belridge project, six wells in the Forbes gas project and two exploration wells at the Turk Anticline. Two additional wells at other projects will be announced shortly, it said.

The new drilling program is expected to begin in the fourth quarter of 2006, subject to availability of drilling rigs.