The Adelaide-based company yesterday posted a net profit of $20.34 million for the six months to December 31, 2006.
Revenue expanded 251% to $246.96 million, while profit before tax for the interim reporting period was $32.26 million compared with the $41.17 million earned in the first half of 2005.
Beach said the prior result was inflated by a one-off gain of $24 million on the sale of shares in Anzon Australia.
The company said while its acquisition of Delhi Petroleum materially increased its sales revenue, there were no sales from the BMG project during the half, due to project commissioning.
But it expects oil and gas revenue to increase significantly in the current half year as a result of oil sales from the BMG project, which began in January.
“With new oil sales from the BMG project, five new oil field discoveries in the Cooper Basin and gas sales commencing from Tipton West, we expect that oil and gas revenue will build significantly throughout the remainder of the financial year and in subsequent years,” managing director Reg Nelson said.
In terms of production, Beach’s proved and probable reserves increased to 101 million barrels of oil equivalent (MMboe).
“Upon commitment to a sales contract and development of the BMG gas project, this reserves base is expected to increase substantially,” Nelson said.
“The reserves base itself is a healthy mix of oil, gas-liquids and gas, yielding production for Australian domestic and international markets from both onshore and offshore facilities.
“We expect that it will support robust revenues and further growth over the coming decade as Beach Petroleum moves towards record production in excess of 10MMboe per annum.”
Production for the first half was 4.69MMboe, sharply up from the 591,000boe in the previous corresponding period.
Beach said 83% of its production was gas or gas liquids, with crude oil accounting for the remaining 17% of production volumes.
The company said its BMG project had expanded “very significantly” in scope and the Basker structure now appears to be much larger than mapped from seismic data.
As a result of initial drilling results, proved and probable oil reserves have been upgraded 168% to 39.2 million barrels (MMbbl), while the best estimate of the contingent gas-condensate resource has nearly quadrupled to 379 petajoules and 9MMbbl of condensate.
“The outlook for an integrated oil, gas and gas-to-liquids project with a life of 10 years or more – and significantly enhanced value – is now very promising,” Nelson said.
“While the immediate production outlook is lower than pre-production estimates, this does not affect the reserves base and the medium to long-term outlook and life for the project remains robust.”
Chairman Bob Kennedy said the company had achieved much during the first half and hoped the market would come to value Beach even more in the year ahead.
“I am confident that throughout 2007 the market will understand and value more and more Beach’s strong reserves base; its diversified range of assets; its position as a supplier of oil, gas, LPG … its proven ability to enhance assets through visionary but conservative management; and its potential to grow through new discoveries and acquisitions,” he said.
