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Cue Energy turns to profit as production income ramps up

Tuesday 24th August 2010

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Oil and gas company Cue Energy Resources turned to profit as production income ramped up 80% in the year ended June 30.

The company, which is 23.6% owned by Todd Petroleum Mining and listed on both the ASX and NZX, reported a A$27.5 million (NZ$34.4 million) annual net profit compared with a A$22.6 million net loss a year earlier.

The previous year's loss included A$27 million in impairment writedowns compared with just A$236,000 in writedowns this year.

Production income jumped to A$54.7 million from A$30.4 million the previous year. Cue says oil sales increased 78% in the year with 590,000 barrels of oil sold in the first full year of the Maari field's production.

The Maari field, 80 kilometres off Taranaki, began producing in February last year.

Cue says the Oyong gas field, off Java in Indonesia, has produced 2.12 billion cubic feet since October 1 last year.

The company cut debt to US$12 million (NZ$17 million). It didn't provide a US dollar comparison for the previous year but the balance sheet shows bank debt fell to A$14.1 million at June 30 from $21.2 million a year earlier.

Cash at year end was A$29.4 million compared with A$4.3 million a year earlier due to cash flow from operations more than doubling and a A$9.7 million equity raising.

As previously announced, Cue sold its interest in the Kimu gas field in Papua New Guinea for US$5.14 million and farmed out a 65% interest in its WA389P permit in the Carnarvon Basin off Western Australia to Woodside Petroleum for US$5 million. Brazil's Petrobras has also bought 50% of the WA361P permit in the Carnarvon basin in which Cue has a 15% interest.

Cue says the Artemis well will be drilled in the December quarter. A decision on the Wortel development in Indonesia will be made before year end, it says.

Businesswire.co.nz

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