In June the junior producer said it needed to develop a sustainable business to deliver disciplined growth and pursue opportunities that offer step-change returns to shareholders, and that requires cutting its cloth.
The debt-free company had $20.49 million cash on hand at the end of the quarter with no debt and two-thirds of revenue emanating from non-oil linked gas sales which are not affected by current low oil prices.
The company produced 173,747 barrels of oil equivalent comprised of 57,029 barrels and 700 million cubic feet for the quarter, generating $9.63 million.
Production for the quarter was strong from the Oyong and Wortel fields, offshore Indonesia and the Maari field in New Zealand.
Cue says the Sampang PSC partners, led by Santos, are undertaking a new sustainability project is underway to potentially extend field life for the Oyong and Wortel fields by two years or more, while work is ongoing on new exploration targets.
Gross production was at 907bopd and 67MMcfpd last quarter.
Onshore Indonesia, Cue has gained a four year extension to the exploration phase of the Mahakam Hilir PSC, where it drilled the promising Naga Selatan-2, and Cue is planning for airborne gravity gradiomentry and LIDAR data to be acquired in the September quarter.
The extension includes two contingent wells in the first two years, which Cue can elect to drill or withdraw from the PSC.
Cue is limiting its exploration expenditure on the Mahato PSC until the company's legal rights are protected, because there has not been a legally binding agreement governing the Mahato PSC JV arrangements since the licence was granted in 2012.
At the Maari project an FPSO mooring upgrade project was completed on time and within budget while the water injection line repair program has been deferred to November at the request of the work boat operator.
Cue's net share of oil sales in the quarter from the Maari and Manaia fields was 43,031bbl which generated $2.25 million in revenue received.
The average oil production rate in the quarter was 8959 bopd, but was as high as 13,000bopd at several points and is expected to be higher overall next quarter now that the mooring line
Upgrade is complete, and in early 2017 when water injection is reinstated should climb again.
Production is expected to average 12,000bopd for the remainder of calendar 2016.
A multi-well work-over campaign is ongoing as planned with the highlight so far being the MR-8A well additional perforation works with the well now producing 1600bopd. A similar workover is planned for the MN-1 well in late August.
Pine Wells in the US (80% working interest) has produced at a gross 100bopd and will be listed for sale.
In terms of North West Shelf exploration, Cue continues to push the farm-out of the 15Tcf Ironbark Mungaroo Formation prospect in WA-359-P, with the drilling of a well due by April 2018, and it is working with BHP Billiton (60%) in WA-398-P to define potential prospects such as Caterina and more new Ironbark-style Deep Mungaroo prospects.
