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- Oil and gas company Senex Energy (SXY) and Gladstone Liquefied Natural Gas (GLNG) will supply Roma North natural gas to the domestic market
- At GLNG’s request, Senex will reduce its natural gas supply to the plant by around one petajoule of natural gas
- The businesses have agreed to re-direct these volumes to the Walllumbilla natural gas supply hub in Queensland
- With regards to gas production, Senex says it is continuing to outperform at both Roma North and Atlas in the Surat Basin
- Due to this strong production, Senex has increased its production guidance to between two and 2.1 million barrels of oil equivalent
- The company has also increased its earnings before interest, taxes, depreciation and amortisation guidance to between $45 million and $55 million, from the previously earmarked $40 million to $50 million
- Senex is up 15 per cent on the market this morning, selling shares at 23 cents each
Oil and gas company Senex Energy (SXY) and Gladstone Liquefied Natural Gas (GLNG) will supply Roma North natural gas to the domestic market.
At GLNG’s request, Senex will reduce its natural gas supply to the plant by around one petajoule of natural gas.
The companies have agreed to re-direct these volumes to the Walllumbilla natural gas supply hub in Queensland. Senex will market this natural gas, with production from Atlas, to the east coast gas customers.
Gas production
Senex says that gas production is continuing to outperform at both Roma North and Atlas in the Surat Basin, with production now exceeding 34 terajoules per day.
Due to the continued outperformance, the company will further reduce the number of wells to be drilled at Atlas to 45 from 50 wells, which was also previously reduced from 60 wells.
Additional wells that will help maintain the plateau production will be drilled in the next campaign.
Senex is aiming to complete the current drilling campaign in the coming weeks, with final wells to be brought into production by June 2020. The company said Atlas water infrastructure is expected to start commissioning in June and is expected to be completed in the early days of the 2021 financial year.
2020 financial year
The company says it has seen strong production performance across the Surat Basin, despite the current pandemic. Due to this, Senex has increased its production guidance to between two and 2.1 million barrels of oil equivalent (mmboe), which was previously 1.8 to two mmboe.
The company has also increased its earnings before interest, taxes, depreciation and amortisation guidance (EBITDA) to between $45 million and $55 million, from the previously earmarked $40 million to $50 million.
“In October 2018, Senex reached the final investment decision for our $400 million capital program in the Surat Basin,” Managing Director and CEO Ian Davies said.
“Less than two years later, the transformational Roma North and Atlas natural gas development projects have established Senex as an important producer of gas for the east coast market,” he explained.
Ian says the increase in the 2020 financial year production and EBITDA guidance shows the strength “of our transformed east coast natural gas business and our ability to adapt and grow in the current lower oil price environment.”
Senex is up 15 per cent on the market this morning, selling shares at 23 cents each at 10:55 am AEST.
