Page 20 - AsianOil Week 33

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the Government’s COVID-19 recovery plans of Brad Lingo, Armour Energy’s CEO said: “I’m Ampol announces retail
stimulating the economy and creating jobs. extremely pleased that Armour has delivered on
APPEA’s WA Director Claire Wilkinson said: a commitment made in the recent entitlement sites deal
“As we look to the post-COVID-19 recovery, offer. On Monday, Armour Energy completed
all responsible development, including of the $4 million Sale and Purchase Agreement Ampol Limited (Ampol) today announces the
WA’s onshore natural gas resources and the with APLNG. When combined with the recent establishment of an unlisted property trust
economic activity and jobs it provides, should be Santos transaction, Armour is able to accelerate that will own 203 core freehold Convenience
encouraged, not stifled. principal amortisation on the Notes by $5.3 Retail sites. The property trust will receive
“A recent APPEA survey showed 89% million, which will bring the total reduction in approximately $77 million in rental payments
of members surveyed have deferred project the past 6 months to $9.15 million. from Ampol in the first year (on a 100%
investment as a result of COVID-19. Today’s However, there is more to be done and Armour basis).
announcement by the WA Government serves is pursuing several commercial opportunities, As part of the transaction, a Charter Hall and
only to reduce investment confidence even further. which when realised, will provide additional GIC consortium will acquire a 49% minority
“Development of gas resources takes many funding for further development and appraisal interest in the property trust for $682 million,
years to assess, explore and appraise, costing activities and enable further material principal reflecting a weighted average capitalisation rate
many millions of dollars in investment before it reductions to the Secured Amortising Notes. of 5.5% and valuing the entire property trust at
is even clear if a resource is commercially viable A further example that Armour is getting $1.4 billion.
to develop. on with business was the recently announced Matt Halliday, Ampol’s Managing Director
“Cutting off a potential market for any gas divestment of Ripple Resources Pty Ltd. and CEO said “Following the completion of
developed is a sure way to signal that WA is not On completion, Armour will have a passive our retail network review in 2019, we identified
open for business. Worryingly, there was no investment in Auburn Resources Pty Ltd, the opportunity to unlock the value of our
industry consultation on this sudden change to a company which is currently investigating high-quality retail property assets through
the domestic gas reservation policy. opportunities to list on the ASX, but more a transaction that would demonstrate value,
Ms Wilkinson said: “WA’s domestic gas importantly, the divestment allows Armour’s to whilst importantly allowing Ampol to retain
market has been well supplied for many years, focus its time and capital, on its core oil and gas strategic and operational control over our core
with locally focussed developments bringing business moving forward.” Convenience Retail network.
significant gas supplies into the WA market. ARMOUR ENERGY, August 20, 2020 “Today’s announcement was made possible
“At the same time, export focussed projects by the significant amount of work undertaken
have brought significant economic wealth to the Beach Energy FY20 Full Year over the past year and represents the successful
state, and the country, and underpinned further execution of the strategy communicated to the
domestic gas development. Results market in late 2019. The transaction represents
“The policy settings were already bringing compelling value in volatile market conditions.”
gas to market that WA needs, so this added Ended the year with $50m Net Cash, AMPOL, August 17, 2020
restriction may actually do the opposite to what highlighting Balance Sheet strength. ROCE >
the Government expects and will reduce future 19% because of high-margins from onshore Santos reports 2020 half-
gas developments. In short, a project that could oil and diversified pipeline gas business. No
be viable if developed for both the domestic and write down of producing assets at reduced year results
export market may not be commercially viable if commodity prices. 214% 2P organic reserves
developed for the domestic market only. replacement ratio and 352 MMboe of 2P Santos today reported first half free cash
“One of WA’s advantages is its abundant reserves. 178 wells drilled at a success rate flow of US$431 million and underlying
natural gas resources – which has underpinned of 81%. Underlying NPAT $461 million and profit of US$212 million. The results reflect
much of our economic growth and prosperity Statutory NPAT $501 million. Final Dividend significantly lower oil prices compared to
in recent decades and provides over half of WA’s 1 cent per share. Same plan at a prudent pace the previous first-half due to the impact of
energy requirements. to manage the impact of COVID-19 and oil COVID-19 on global oil demand.
“Natural gas provides electricity for our prices. Waitsia Stage-2 FID anticipated in The reported net loss after tax of US$289
schools and hospitals and powers mines to December 2020 quarter, gas from new 250 million includes the previously announced
develop the mineral resources that contribute TJ/d facility to be processed into LNG at non-cash impairment due to revised oil price
hundreds of millions of dollars a year in royalties North West Shelf Facilities. Waitsia Stage-1 assumptions.
to the state. expansion being commissioned, Beach Perth The Board has resolved to pay an interim
“It is extremely concerning that with a flick Basin joint ventures providing 40 TJ/d to dividend of US2.1 cents per share fully-franked,
of a pen, and not as much as a discussion with domestic gas market in FY21 and seeking in line with the company’s sustainable dividend
industry, that the future prosperity natural gas further domestic gas sales opportunities. 6+ policy which targets a range of 10% to 30%
can provide would be put at risk.” well offshore Victorian Otway Basin drilling payout of free cash flow.
APPEA, August 17, 2020 campaign to commence by March 2021 via Given the ongoing uncertain economic
a new rig contract signed with Diamond impact of COVID combined with the lower
Armour updates on Ripple Offshore. Revised low-risk investment profile oil price environment, the Board determined it
targeting 37 to 43 MMboe production in
was prudent on this occasion to set the interim
deal FY25 from existing portfolio. 5-year outlook dividend at the lower end of the target payout
generates >$2 billion of FCF at lower price
range. The Board will review the payout again
The Board of Armour Energy wishes to assumptions. Significant Carnarvon Basin when it considers the final dividend in February.
provide an update on the asset transaction prospect, Ironbark, to be drilled by BP in Santos Managing Director and Chief
process, and proposed divestment of Ripple Q2FY21 Executive Officer Kevin Gallagher said the first
Resources Pty Ltd. BEACH ENERGY, August 17, 2020 half of 2020 had delivered record production

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