AWE blamed its pre-tax loss of $19.5 million on hedging contracts for its condensate production and non-cash write-downs for its exploration efforts and the adoption of “successful efforts” exploration accounting under the new Australian equivalent of International Financial Reporting Standards (AIFRS) regime.
However, revenue jumped 340% to $25.1 million, thanks to the start-up of production at the Casino gas project, offshore Victoria, and Cliff Head oil development in the Perth Basin towards the end of the period.
The growth in revenue was largely driven by higher oil prices and record production of 900,000 barrels of oil during the year, a 139% jump on fiscal 2005.
AWE said its balance sheet remained strong, with $156 million in cash at year-end, and project debt – related to the BassGas and Casino projects – of $122 million.
“The delivery of initial production at Casino, Cliff Head and BassGas represents a major milestone for AWE,” the company said in its full-year financial report released Friday.
“This production base has provided a substantial lift in sales revenue and cash flow for the business, which is expected to continue for some time.”
During the last financial year, AWE drilled only two exploration wells, with a commercial success at Henry-1, near the Casino gas field. A major development drilling campaign was undertaken at Cliff Head, where a total of eight wells were drilled and completed.
AWE has now shifted its focus towards exploration for fiscal 2007, as it moves to a multiple-well drilling program in New Zealand.
The company plans to drill five wildcats and four development wells in the Canterbury and Taranaki basins, in what is set to become its largest exploration campaign in AWE’s nine-year history.
