In QGC’s financial year report, managing director Richard Cottee said the company was otherwise performing well, with strengthening gas production and increasing sales reflecting its low-risk and low-cost operating model.

“Whilst the company has reported a net statutory loss of $12.2 million, this should be viewed in the light of defending an opportunistic takeover which cost $14.5 million,” he said.

In February, Santos was forced to scrap its four-month campaign to acquire QGC when the ACCC (Australian Competition and Consumer Commission) argued the takeover would reduce competition in the Queensland CSM market.

In what was its first full-year as a producer, QGC reported a $23.8 million operating profit after cost sales for 2006-07.

This profit was based on 11.5 petajoules of gas sales – almost double the target of 6PJ - and revenue of $27 million, compared with $1.2 million in the previous 12-month period.

At the end of June 2007, QGC had 1120PJ of proved and probable (2P) gas reserves, exceeding the 1000PJ target.

By year-end, the company hopes to boost this figure to 1600PJ and by March plans to expand current gas plant production capacity of 37PJ per year to 60PJ per year.

In a year’s time, it aims to have 120PJ of production capacity.

“In our first full year of production, QGC has become a market leader in coal seam gas and proved that we are well positioned to take advantage of expected growth in the Australian gas market,” Cottee said.

“QGC has identified substantial 2P gas reserves and importantly, we have proved that we can convert those reserves into commercial success by delivering gas on time and on budget.”

In addition, the company lifted the value of its assets 600% to $523.6 million, up from $70.6 million in 2005-06.