Cue Energy - Quarterly Activities Report - 24 July 2024
CUE ENERGY RESOURCES LIMITED (CUE) Share Update July 2024 Wednesday 24th
Cue Energy Reports Strong Cash Flow and New Developments
Cue Energy Resources Limited (ASX: CUE) has released its quarterly activities report for the period ending 30 June 2024, highlighting strong financial performance and significant operational developments.
Instant Summary:
- $14 million returned to shareholders through a 2 cent/share dividend.
- $5.6 million net cash flow reported for the quarter, excluding dividends.
- Approval for 14 additional oil development wells in the PB field, Mahato PSC, Indonesia.
- Ongoing plans for drilling two new Mereenie gas development wells.
- Gas Supply Agreement with PWC secured for 2024, with an EOI released for gas supply from 2025 to 2030.
Financial Performance
Cue Energy reported $16.9 million in cash receipts for the quarter, resulting in a net cash flow of $5.6 million, excluding the $14 million dividend paid in April. The company's balance sheet remains robust with a cash balance of $16.3 million and no debt.
Despite some short-term production impacts, the overall portfolio strength and positive outlook remain intact. Cash receipts from Cue's onshore Australian assets were lower due to the Northern Gas Pipeline shutdown and the annual Take or Pay Payment from the Dingo field in Q3.
Operational Developments
In Indonesia, Cue received approval for 14 additional oil development wells in the PB field, Mahato PSC. The first well in this program has already been completed and is in production. Additionally, ongoing plans for two new Mereenie gas development wells in Australia are in progress.
The company also secured a Gas Supply Agreement with Power and Water Corporation (PWC) for sales into the Northern Territory for 2024. An expression of interest has been released for gas supply from 2025 to 2030.
Production and Revenue
Production and revenue details for various regions are as follows:
- Australia: Gas production at 0.31 PJ and oil production at 2,089 barrels, with cash receipts of $2.3 million.
- Indonesia: Sampang PSC gas production at 0.22 PJ and oil production at 462 barrels, with cash receipts of $2.3 million. Mahato PSC oil production at 36,920 barrels, with cash receipts of $8.7 million.
- New Zealand: Oil production at 18,653 barrels, with cash receipts of $3.6 million.
Total production for the quarter was 143.5 thousand barrels of oil equivalent (kboe), with total cash receipts amounting to $16.9 million.
Corporate Updates
Cue paid a 2 cent/share dividend to shareholders on 5 April 2024, totaling $14 million. The company has committed to a dividend policy aimed at delivering sustainable returns, evaluating its financial position on a half-yearly basis.
Due to the company's growth, a full-time Financial Controller was employed to oversee the finance function, previously managed by Vistra Australia. Cue also released an updated investor presentation in June.
The strong financial performance and new developments are likely to positively impact Cue Energy's stock price. The approval of additional wells and the secured Gas Supply Agreement demonstrate the company's commitment to growth and shareholder value. Investors may view these developments as a sign of robust future prospects.
Investor Reaction:
Investors and analysts have reacted positively to the announcement, citing the strong cash flow and strategic developments as key drivers of future growth. The return of $14 million to shareholders through dividends has also been well-received.
Conclusion:
Investors should keep an eye on Cue Energy's ongoing developments and financial performance. The company's strategic focus on high-performing assets and shareholder value makes it a compelling investment opportunity. Stay informed on Cue Energy's progress and consider the potential long-term benefits for your portfolio.