Q2 FY2024 Results Briefing Webcast
Summary
TLDRThe transcript details a financial briefing by Hibus Petroleum for Q2 FY2024, highlighting a significant quarter with the company's first achievement of over 22,000 barrels of oil equivalent per day in production. Despite a dip in oil and condensate sales, the company produced more oil and gas than the previous quarter. They remain on track to meet their 2024 sales target of 7.5 to 7.8 million barrels oil equivalent. Financially, they reported a revenue of $62.76 million, influenced by lower oil prices, and declared a second interim dividend of 2 cents per share. The briefing also covered operational updates, reserve and resource numbers, and future growth strategies, including potential acquisitions and the importance of maintaining a strong financial foundation. The company is actively exploring new opportunities and is committed to doubling production by 2026, with a focus on the right assets at the right price. Management also addressed concerns about geopolitical risks and the importance of health and safety, legal regulatory stability, and long-term decommissioning considerations in their investment decisions.
Takeaways
- 📈 The company achieved a significant milestone by producing above 22,000 barrels of oil equivalent per day for the first time in Q2 2024.
- 📉 Despite higher production, the total oil and condensate sold was lower compared to the previous quarter due to the timing of offshore tankings.
- 💰 Revenue for the quarter decreased by 15.9% to 627.6 million ringgit, primarily due to lower oil prices.
- 📊 The company is on track to meet its 2024 sales target of between 7.5 and 7.8 million barrels of oil equivalent.
- 🌐 Exploration drilling has commenced with four targets, and the first two have been completed with data analysis underway.
- 🇲🇾 In Malaysia, the North Saba field has seen significant production improvements following drilling activities and maintenance completion.
- 🇬🇧 The UK cluster has submitted a concept select report for the Fine field and has acquired five new blocks in the Central North Sea.
- 🔋 The company declared a second interim dividend of 2 cents per share for the fiscal year 2024 and has completed a share buyback of 3 million shares.
- 📊 Operational costs have slightly improved in some areas due to higher production numbers, contributing to maintaining a profit margin exceeding 50%.
- 🎯 The company is actively looking for acquisition opportunities to close the gap towards its 2026 target of 35,000 to 50,000 barrels of oil equivalent per day.
- 🌟 The company emphasizes the importance of health and safety, regulatory stability, and geopolitical risks when considering new investments or acquisitions.
Q & A
What was the significant achievement in the first quarter of the financial year 2024 for Hius Petroleum?
-The significant achievement was that it was the first quarter that Hius Petroleum achieved above 22,000 barrels of oil equivalent per day in terms of production.
What was the total oil and condensate sold in the second quarter of the financial year 2024 compared to the previous quarter?
-The total oil and condensate sold was a bit lower in the second quarter compared to the previous quarter, which was mainly due to the timing of the off-takes.
What was the revenue generated for Hius Petroleum in the second quarter of the financial year 2024?
-The revenue generated was 627.6 million ringgit, which was lower than the previous quarter, primarily due to lower oil prices.
What is the target for the full financial year 2024 in terms of dividends per share?
-The target for the full financial year 2024 is to provide at least 7.5 cents per share in dividends.
What were the highlights of the exploration drilling activities in the recent quarter?
-The highlights include the commencement of exploration drilling with four targets in total. The first two targets have been completed and analyzed, and drilling is currently ongoing for the third target.
What is the status of the Te West project?
-Drilling for the Te West project is set to commence in the middle of the financial year 2025, with the first oil targeted towards the end of the calendar year 2025.
What improvements were noted in the production levels across the producing assets?
-There was a significant improvement in production on the back of completed planned maintenance activities. Notably, the wells drilled in 2023 in Peninsula have contributed to the production increase.
What is the current operational cost per barrel of oil equivalent (Boe) for the North Saba and Peninsula assets?
-The unit operating cost slightly improved in North Saba to about $30.7 per barrel, while for Peninsula, it is $26.75 per Boe.
What was the impact of the drilling campaign on the Kinabalu PSC in terms of net production numbers?
-The drilling of two infield wells completed in 2023 led to a significant improvement in net production numbers, increasing from 2,700 barrels per day in the previous quarter to 4,096 barrels per day in the last quarter.
What is the company's strategy for acquisitions to achieve the 2026 target of 35,000 to 50,000 barrels of oil equivalent per day?
-The company is continuously prospecting the market for acquisitions that fit their criteria of being the right asset at the right price and at the right time. They aim to close the gap of approximately 10,000 barrels of oil equivalent per day to meet their 2026 target.
What factors does the management consider when assessing the risk of acquiring assets in different regions, such as geopolitical and legal regulatory risks?
-Management considers several factors including geopolitical risks, stability of the legal framework, long-term decommissioning rules, and the company's ability to survive if an asset has to be written off due to unforeseen circumstances. They aim to avoid situations where force majeure measures may be invoked and ensure the company can stand on its feet even if an asset fails.
Outlines
😀 Introduction and Q2 2024 Financial Results Overview
The video script begins with an introduction by Liy Ling, VP of Corporate Development, who is joined by various team members including the CFO and VP of Economics and Business Planning. They discuss the release of the company's Q2 2024 financial results and operational updates. The company has achieved a new production milestone of over 22,000 barrels of oil equivalent per day. There's a mention of a slight decrease in total oil and condensate sold due to timing of offtakes, but overall production has increased. Financially, the company generated a revenue of 627.6 million ringgit, influenced by lower oil prices. A second interim dividend of 2 cents per share is declared for the fiscal year 2024, and the share buyback of 3 million shares has been completed.
📈 Operational and Financial Performance for Q2 2024
The second paragraph focuses on the operational and financial performance of the company during the second quarter of the fiscal year 2024. It highlights that the realized oil and condensate price was $90 per barrel, with an integrated gas price of about $70 per barrel of oil equivalent (Boe). The company sold 1.8 to 1.9 million barrels of oil equivalent, and is on track to deliver approximately 7.7 million barrels of oil equivalent for the fiscal year. The production and unit operating costs are discussed, with improvements noted in several assets. The company's operational highlights include Kinabalu PSC's significant improvement due to drilling activities and the PM3 CA PSC's sustained oil production. Exploration activities are also covered, with updates on drilling targets and participation in licensing rounds.
🌟 Reserves and Resources Update
The third paragraph provides an update on the company's reserves and resources. It details the 2P (Proven and Probable) reserves and 2C (Contingent) resources for the Habiscus group as of January 1, 2024. The total 2P oil and condensate reserves are reported to be around 60 million barrels of oil equivalent, with 49.9 million barrels being oil and condensate, and 11 million barrels being gas. The 2C oil resources are estimated at 59 million barrels, mainly from the Marold field. The paragraph also discusses the company's forward plans, including the development of assets in the UK and the expectation of first oil from the Te West project by the end of 2025.
📊 Profit Margin and Balance Sheet Analysis
The fourth paragraph delves into the company's profit margin and balance sheet. Despite a decrease in revenue due to lower oil prices and a reduction in offtakes in North Saba, the company has managed to maintain a profit margin exceeding 50%. The operational results have improved significantly, particularly due to the completion of planned maintenance activities in the Malaysian PSC. The depreciation and amortization of non-current assets have increased, which has slightly impacted the profit margin. The tax situation is stable, and the company has a healthy cash position, allowing it to support capital expenditure programs and consider new opportunities.
🎯 Future Projections and Growth Strategy
The fifth paragraph outlines the company's projections for the current year and its growth strategy. The company is on track to meet its production guidance of 7.5 to 7.8 million barrels of oil equivalent for the fiscal year, which represents an improvement over the previous year. The company has provided detailed breakdowns of oil and gas deliveries and is actively seeking acquisitions to achieve its 2026 target of 35 to 50,000 barrels of oil equivalent per day. The company is also focused on organic growth through projects like Teal West and sf30 water flood, and it emphasizes the importance of securing the right assets at the right price and time.
🏗️ Project Updates and Exploration Activities
The sixth paragraph provides updates on important projects for the next year, including Teal West and sf30 water flood, and emphasizes the commitment of significant capital expenditure to these projects. The company is also actively scanning various opportunities for acquisitions, with a focus on being funded and ready to make bold statements about their financial capabilities. The paragraph also touches on operational improvements, maintenance catch-up post-COVID period, and the importance of keeping unit production costs at current levels while maintaining asset integrity and uptime.
🤝 Acquisition Strategy and Exploration Insights
The seventh paragraph discusses the company's acquisition strategy and its approach to exploration. The company is looking to close a gap of about 10,000 barrels of oil equivalent per day to meet its targets and is actively seeking the right assets at the right price. It also addresses the company's satisfaction with reserve replenishment activities and its commitment to exploration, including drilling activities and the pursuit of new resources. The company's approach to risk assessment, considering geopolitical and legal regulatory risks, is also highlighted.
🔍 Exploration Wells and PM3 CAA Extension
The eighth paragraph provides insights into the company's exploration wells, noting that while some data is available, technical work and partner agreement are necessary before definitive statements can be made. It also addresses the progress of the PM3 CAA extension, with regulatory meetings held and a key principal agreement aimed to be in place by the end of the year. The importance of timely agreement to avoid deferred developments and potential production drops is emphasized.
🌐 Geopolitical Risks and Asset Considerations
The ninth paragraph focuses on the company's considerations regarding geopolitical risks and legal regulatory stability when assessing potential assets or blocks. It discusses the importance of evaluating long-term decommissioning rules and the potential impact on the company's ability to survive if an asset were to go wrong. The company's approach to risk assessment and its commitment to transparency are highlighted, with the mention of releasing the webcast recording of the briefing on their website.
📅 Closing Remarks and Upcoming Webcast Release
The final paragraph consists of closing remarks from the company, thanking participants for attending the briefing and reminding them that the recording will be available on the company's website the following day. The company encourages any further questions and wishes everyone to stay safe.
Mindmap
Keywords
💡Barrels of Oil Equivalent (BOE)
💡Revenue
💡Interim Dividends
💡Exploration Drilling
💡Reserves and Resources
💡Production Cost
💡Capital Expenditure (CapEx)
💡Share Buyback
💡Operational Metrics
💡Financial Year (FY)
💡Maintenance Activities
Highlights
The company achieved a production milestone of over 22,000 barrels of oil equivalent per day for the first time.
Total oil and condensate sold was lower this quarter due to timing of offtakes, despite increased production.
Sold 0.7 million barrels of oil equivalent of gas, marking a 14.1% increase.
On track to meet the 2024 sales target between 7.5 and 7.8 million barrels oil equivalent.
Revenue generation of $62.76 million, primarily affected by lower oil prices.
Declared a second interim dividend of 2 cents per share for the fiscal year 2024.
Completed a share buyback of 3 million shares, retaining them as treasury shares.
Exploration drilling initiated with four targets; the first two have been completed and data analyzed.
Submitted the concept select report for the Fine Field to the authorities and awaiting feedback.
Successfully acquired five blocks in the Central North Sea during the 33rd UK offshore licensing round.
Drilling for T West is set to commence in mid-2025, with first oil targeted for the end of 2025.
Significant improvement in production for North Saba and Peninsula due to completed maintenance activities and contribution from wells drilled in 2023.
Unit operating costs slightly improved in Nor Saa due to higher production numbers.
Drilling of two infield wells in Kinabalu PSC in 2023 led to a significant increase in net production numbers.
Net average production rate in PM3 CA PSC sustained due to the H4 drilling campaign.
1P reserves and 2P resources numbers updated as of January 1, 2024, with TP reserves at approximately 60 million barrels of oil equivalent.
The company aims to double production by 2026 and is actively looking for acquisition opportunities to achieve this target.
Share buyback activities are ongoing, with a set budget for this financial year, and the company is opportunistic about it.
Exploration activities are expected to continue, with a focus on cost recovery mechanisms and potential farm-ins to high-chance blocks.
The company is focused on health and safety, operational excellence, and maintaining a strong balance sheet while pursuing growth opportunities.
Transcripts
evening everyone and Kai to those
celebrating thank you for joining us for
the hius petroleum quarter 2 Financial
year 2024 analyst and F managers
grouping I'm liy Ling VP of corporate
development and I'm joined by our CFO
yep
c b taker our VP of economics and
business
planning Dr Pascal hos our country HTE
Malaysia and Vietnam Joyce wasu dwan our
head of corporate finance and Andrew
Fernandez from my team our managing
director Dr P Perera will join us
shortly after his board meeting has
ended we are also accompanied by the
team from F PR our recently appointed IR
partner believe you would have received
email invites from them for this
briefing and to those who check in
earlier Andrew and myself are very much
on board for ir and yes I'm grateful to
still have my job this afternoon release
our results and on our website you'll
find our corporate and business update
CBU uh which details out our financial
and operational updates press release
and this briefing slides which can also
be found in this Zoom chat we'll kick
off with the presentation followed by
the FAQ if you have any questions type
them in the chat or raise your hand and
we'll call on you to unmute and ask your
question so I'll pass this over to
Pascal
now all right
thanks evening everybody thank you for
joining us this
late let's
let's dive in straight away so I get the
pleasure of giving you the highlights of
a quite an exciting
quarter uh to start off with just want
to highlight that uh this was the very
first quarter that we've actually
achieved above 22,000 barrels of oil
equivalent per day in terms of
production um the total oil and
condensate sold uh is a bit lower this
quarter compared to the previous quarter
but as uh pretty much just a matter of
timing of the off Tes yeah so we
actually produce more oil than in the
previous quarter
um we also produce more gas yeah so we
sold .7 million barrels of O equivalent
of gas which is 14.1%
increase uh just to highlight that we're
still on track to hit the potential year
2024 sales Target between 7.5 and 7.8
million barrels oil
equivalent okay so in terms of the
financials we generate a revenue of six
27.6 million
ring down over previous quarter which is
primarily driven by lower oil
prices the Ia reached
3253 R also is roughly the same
percentage lower compared to the
previous
quarter uh on the back of these results
we declared a second inter dividends of
2 cent per share for fiscal year
2024 and we've now completed the share
by back of 3 million shares that have
been retained as treasury
shares so in total uh in terms of
dividend we' declared 4 Cent so far and
the target is for full Financial year
2024 to provide at least 75 7.5 Cent per
share
divid terms of projects highlights yeah
this this last quarter we kicked off
exploration drilling yeah uh we're total
we're Drilling
four targets the first two Targets have
been completed and the data has been
analyzed as we speak currently drilling
the third
target um in terms of the UK um the
concept select report for the fine field
has been submitted to the authority the
nsda so we're waiting on feedback on
that
report on top of that uh recently we
participated in the 33rd UK offshore
licensing rounds and we were
successfully five blocks in the Central
North Sea all complimenting um our
existing assets there
already terms of T West the update there
is that drilling is to commence in the
middle of gendar year
2025 with first oil targeted towards the
end of calendar year
2025 okay and with that I hand it over
to uh to defa give you operational
Financial thanks
Pascal um so let's U go through the
operational highlights and operational
metrics for each of the psc's uh before
we hand it over to Cy for the financial
highlights so this slides uh gives you
an operational highlights for all of our
producing assets um so on a on habiscus
for habiscus group as fcal stated uh we
produced 22,000 barrels of oil
equivalent per day that's our net
production of oil condensate in
gas in terms of realized price
uh we our realized oil and condensate
price was $90 per barrel and once we
integrate the gas it's roughly about $70
per
Boe total volumes of oil condensate and
gas which we have sold in this quarter
was 1.8 or 1.9 million barrel of oil
equivalent combined quarter 1 and
quarter 2 for FY 2024 we have sold
roughly about 3.9 million barrel of oil
equivalent and we are we are on track to
deliver close to 7.7 million barrel of
oil equivalent so remaining 3.8 million
barrel of oil equivalent would be sold
in quarter three and quarter four going
for the bottom we are showing the
production and unit operating cost um so
overall the production level in all of
the uh the producing assets have
improved anasua more or less very
similar to what we produced last quarter
but in nor saba and Peninsula
significant Improvement in production on
the back of basically the um the last uh
planned maintenance activity has been
completed and then uh in Peninsula
espically the wells which we drilled in
2023 the contribution from all of the
wells have been realized right so in
notaba we produced
5,133 U barrels per day anasua 2,100
barrels per day barrels of oil
equivalent per day Peninsula is
14,940 barrels of oil equal per day our
unit operating cost uh is slightly
improved in nor SAA because of higher
production numbers so roughly about 30.7
us per barrel um anasua is $
32.97 per Boe and Peninsula is
26.75 US per
Boe okay let's go to the next slide so
this is this this particular slide is uh
for Kinabalu PSC so we are going to
cover Kinabalu pm3 CAA nor saba and
anasua for producing assets so in
Kinabalu
PSC um two significant um with drilling
of two infield Wells completed last year
in
2023 uh we have seen significant
Improvement in net production numbers um
now it's last quarter it was 4 96
barrels per day compared to previous
quarter was 2,700 barrels per
day uh and and as a result of it net
Opex per barrel has reduced uh
significantly okay let's go to the next
slide okay uh pm3 CA
PSC um so the net average production
rate is 10,532 barrels of oil equivalent
per day
which is on the back of the sustained
oil production from the
H4 drilling campaign of the wells which
we drill last year in
2023 the Opex per barrel Opex per barrel
of oil equivalent um is more or Lessing
slightly increased to
27.1 n compared to the previous quarter
um because of some one of uh plan
maintenance activities in uh in spec
specifically related to both fso which
we run so in terms of the life extension
projects um which were
done and also we delivered higher gas
sales in compared to compared to the
last year due to the plan due to the
completion of the pl maintenance
activities let's go to the next slide
then so the North Saba uh we produced
5,13 three barrels per day uh
significant Improvement in production
net production for North Saba uh is is
coming from two key factors one
is we are drilling sf3 so so we are
spending capex on sf3 water FL Phase 2
project so all of these capex has helped
us to increase our entitlement to close
to 36 37% in this particular uh
water
um and of course second is the
completion of the maintenance
program um going back to the exploration
um activities which Pascal was talking
about there are three targets two
Targets have been completed drilling
third target uh and then we will uh with
all of the data being reviewed by our
subsur okay let's go to the next slide
it is UK an
cluster so in anasua we produced
2,118 barrels of oil equival but very
much similar to our last quarter uh we
completed our 15 days uh plan shutdown
activity at anasui
PSO net Opex Barrel you will see slight
increase um increase by about4 to5 per
bu Bas Bas basically related to one of
health and safety related in inspection
activities which we had to do that um
coming to the the forward plans in terms
of our UK development assets to the te
West uh first oil expected in the
quarter 4 calendar year
20125 fine field fine discovered asset
which we acquired from Rapid um so we
have we have submitted our concept
select report to nstda the fine is also
candidates to tie back to
anasua so very similar to what we are
trying to do in Te West te West well
will be would be tie back to anasua Appo
and in next few years we would do the
same for the fine discovered fine that's
that's objective in addition we have
been awarded uh five blocks um in UK
noty all proximity to the mar gold field
just to kind of aggregate all of those
discoveries around marold
period okay let's go to the next slide
so this slide shows uh the reserves and
resources numbers basically 2 p reserves
and two resources for habiscus uh group
all of these numbers are net to habiscus
group so our total uh 2p oil and
condensate reserves as a 1 January
2024 previously we were showing the
reserves and resources numbers as at 1
July 2023 now what we have done is we
have subtracted the actual oil gas and
condensate production from the previous
uh previous reported reserves and this
is the updated numbers so as of 1 July 1
January 2024 our TP
reserves um stands roughly about roughly
about 60 million barrel of oil
equivalent out of its 49.9 is oil and
condensate and 11 million barrel of oil
equivalent is gas resar
on the third column third bar we are
showing this is 2C oil resources which
is 59 uh million barrel of oil 59
million barrel barrel of oil
predominantly coming from 33 million
Barrel biggest contributor is the mar
gold uh followed by followed by our
Australia and then
nor let's go to the next slide so I will
hand it over to Cy thanks DEA uh good
evening everyone
[Music]
um now I think you've heard from uh dear
um and also from Pasa earlier that they
have generated quite favorable
operational performance during the
quarter and heating above 22,000 Boe per
day for the first time in one quarter
but uh that did not really translate
into the sales volume as as you are
aware that our sales volume is uh you
know depends on the timing of the Optics
so um that place fairly big part in the
in the revenue that we have recorded for
the quarter uh you can see that in the
first uh the chart on the left far left
um Revenue went down by
15.9% uh and that's really because uh in
North Saba when you compare against the
last preceding
quarter uh they had um two offs uh
generating close to about 550,000
barrels whereas this time around it was
about 350,000 so that's really again
timing nor sa in a particular Financial
year you would um expect them to
generate about five off takes uh so that
two so one quarter will always have two
and that was the last quarter so hence
you will see this uh particular um I
mean this is the main reason really uh
that we also highlighted that oil prices
that we have realized for all the sales
uh is a little bit was a bit lower
compared to last quarter but but but I
say lower is not like low uh it's not
low really our average oil price for the
quarter was 9021 and that's that's
fairly High actually uh but if you
compare to last quarter uh it was
touching almost 100 and hence that also
if you compare the two quarters then you
get this particular
trending okay and so along with that um
I move to IA the the thing is with I if
you look at the quantum it is lower uh
but if you look at the I margin despite
lower oil prices or uh for oil and gas
prices we have
actually um managed to uh
maintain a margin to be uh to be to to
exceed 50% so 52.6 this time around uh
last time around against 51.8 in the
second quarter so um and the quantum
that have gone down is really because of
the lower Revenue but um the reason why
we could maintain our profit margin uh
importantly is because our operational
results have improved quite
significantly during the second quarter
uh in the first quarter we've conducted
and completed all the U plan maintenance
activities particularly in the Malaysian
PSS uh so that was uh uh conducted prior
to
October uh and I think DEA also alluded
to two Wells from uh two new infu wells
this year this financial year um but the
impact was full fully recorded only in
Q2 because one of them was in August and
one of them came online in October so uh
the full impact of these two infs were
uh were were were recorded in the second
quarter and uh there there are no
maintenance I mean there's nothing um
really one of uh adverse activities uh
from operational
perspective uh from a p perspective
there is a little bit lower uh profit
margin compared to last quarter now
that's despite Marin being quite
consistent that's really because um in
tandem with the higher production levels
particularly in Kinabalu and
pm3 uh the depreciation and mization of
our non-current assets have also
increased so non-cash in nature uh and
hence there is this uh Dro in uh decline
in P margin compared to the beta margin
um on the tax front no surprises uh to
highlight this
quarter okay so the next next page now
this one uh Compares buy asset or buy
cluster of assets the
um selling price um the Opex per barrel
oper Boe net Opex per barrel oper Boe uh
and the uh I margin for each quarter um
from 1 Q fi 20 from the last Financial
year on
uh and what what you can see is this
since we quite the Peninsular group of
assets um our profit margin has always
exceeded 50% that's the margin has
always exceeded 50% um regardless of
where the oil price is and uh we have
always be able to maintain um the
operations to a good extent because of
the scale of that uh uh cluster of
assets they're big enough to actually
sustain all the um any adverse operation
um or or you know uh activities uh North
Saba quite similar uh we have
uh been achieving almost always above
40% uh in the past uh six
quarters and uh in anuria I think as we
all know anria is a bit more what you
call it bit more
um it it it is more fluid so when the
oil prices uh go higher your profit our
profit margin will be also quite uh will
increase more sharply and hence you can
see that our beta margin uh
is can can can go up to 60 to 70% in the
past and this quarter because of some
additional cost in Cur for some HC
health and safety related activities it
was close to
%. so in all very profitable quarter uh
cross all
plus so then that brings us to the
balance sheet High um another so another
good quarter obviously and that brings
our shareholders funds to be about
2.9 Million RM um slightly increased
from the last quarter as well and also
from uh because of the positive
contribution from all of our groups um
using
assets um you will see that there is a
debt I think we've highlighted this
before this is the term loan that we
have undertaken uh but the bance the
balances are reducing and we have making
uh the repayments um have been made as
per schedule and that resulted in a net
cash position to the group of close
close to 500 million as at 30th uh 31st
December
2023
okay so that's a healthy cash position
actually and that allows us
to support our capital expenditure
programs internally and if we find any
um right opportunities then you it also
allows us to um to partake in those
uh okay I think that's the the next
section would be Ken good evening
everyone thank you very much for joining
us sorry I'm a bit late joining this but
you know straight into
the but to present all the good news so
um yeah so I think uh just to kind of
talk a little bit about what we are
expecting to deliver this year I think
generally you would have seen from the
results uh at the moment things going a
little slow we are we are on track to
deliver on our our on our guidance for
production uh we we gave guidance that
we would be somewhere in the range of
7.5 to 7.8 million barrels of oil
equivalent for the year the financial
year uh that is up from 7.1 million
barrels of oil equivalent that we
delivered last year at this point in
time as we see it we hope we will get
somewhere in the range towards the
higher side of that guidance probably
around the 7.7 markets what we're
targeting at this point in time but you
know that all the same an improvement on
on last year uh in terms of kex uh also
um we've got projects in nor Saba
Kinabalu uh we are funded for the capex
the number looks a little bit um a
little bit scary but important to say
that we are funded and all of these
projects hopefully we'll be delivering
some uh increases in production and
we'll see that next year okay so it
looks a large number but the important
thing is we we will not have to do any
kind of equity raise to fund this kex
it's all will be from internal
funds uh dividends we have given
guidance again 7.5 cents per share for
on on on the Consolidated share basis so
um uh you know and uh hopefully that is
going to uh it's a 20% increase from
last year Financial year 2023 so
hopefully U hopefully oil prices stay
stay strong uh this next year we will
look at something a bit even more
aggressive but for now this is the
guidance we're able to
provide um the following slide we're
just giving some gr Gran granularity on
on our production schedule so that you
can work on your models um just kind of
saying exactly where the production is
coming from whether it's oil or gas uh
and uh already we also are are
disclosing here what has actually been
already delivered for January the month
of January that's already been delivered
and you will be able to see how we build
up that number of 7.7 million barrels in
the last in the last column there uh in
yellow uh that 7.7 million barrels how
it's how it's uh being built up over the
next few quarters what we try to do uh
and we're not super successful all the
time on it but we try not to have too
many
uh of takes and this is when we sell the
caros of oil in the same week in the
same month because then sometimes as the
oil price moves we might expose
ourselves to a little bit more
volatility so what we try to do is we
are trying to um smooth it out over the
years so that's the kind of agenda that
we have what we've also done on this
chart I'm not going into every sell
every number in every sell but the
important thing is uh the team has given
a breakdown of you know what what are
oil deliveries and what are gas
deliveries and the 7.7 million barrels
how much of it is oil so you can then
Park uh you can you can then compute an
oil revenue from that and you can also
compute the gas Revenue you can you have
the breakdowns so hopefully you find
that helpful and you'll find this chart
useful I
think in terms of growth um you know we
we are we are always in we're always
prospecting the market looking to U help
us achieve our 2026 Target of 35 to
50,000 barrels of oil equivalent per day
that's going to be more than double
where we are today so to get to
somewhere in the the midpoint range
we'll have to double up production so so
we are always looking for an acquisition
production will uh organic growth
production will only take us a certain
amount of the way so um we are going to
um also be all the time looking for for
um uh some kind of attractive asset to
buy uh and and there are some there are
some processes ongoing around the region
and all of them are of interest to us so
we we keep we keep looking but it's it's
not about getting asset it's about
getting the right asset at the right
price for us it's got to be in the right
in the right uh phase of its own life
cycle for for us to be able to add value
and make an impact so it's important for
us uh important projects for next year
will be teal West to deliver some some
production and also the sf30 water flood
you know a lot of kexs is being
committed to these projects so they will
have to deliver the numbers in terms of
production but will not get us to our
Target so somewhere along the line over
the next between now and 2026 we will
have to try to close uh and it's not
going to be one deal that brings the
Silver Bullet it may have to be a couple
of deals that take us there okay so uh
the team is working hard scanning
scanning the various opportunities to to
see whether uh they would work for us
and and it's also nice that we have some
unused uh facilities in terms of funding
so when we go to buy assets uh we are
not telling the vendor it's subject to
some funding process we are able to to
make some pretty uh you know bold
statements about doing being funded to
do something so that's that's also
pretty good
thing I think then on the last last um
last slide I think I think it's the last
slide so um how come I got the most
number SL me and Deepa getting the most
number slides yeah so anyways um yeah so
we are we're trying to um you know we're
working on all fronts um the the growth
strategy very very important very very
clear across the company everybody's
aligned towards this uh singular mission
to double production by 2026 we are
backed by a lot of development
opportunities within the company but at
the same time because um there are there
are acquisition opportunities we are
also looking looking at those uh we've
been doing some nice work on the
operations so
ERS are you can see the production is
increasing uh we have also caught up a
lot of the the maintenance you can see
some of the unit production costs have
increased we've had to catch up on a lot
of Maintenance that was deferred from
the covid period I think we just about
got now so I think uh hopefully we'll be
able to keep our our unit production
cost at at these type of levels uh and
keep the Integrity of the assets High
and the and the up times high as well in
terms of U Capital uh the cash flow
statement the balance sheet are are are
telling a reasonably good story uh cash
balance is is reasonably strong the cash
flow quite strong and and we've got some
unutilized fac facilities and and and
the facilities that we have utilized as
well not not a huge gearing ratio at
this point in time so we're quite
comfortable with that uh we are working
we are we've kept a continuous flow of
dividends since we started paying
dividends so we will try to keep that
going for
2024 we like I said we' have provided
some guidance on where we will be for
financial year
2024 and uh yeah the valuation is the
only thing disappointing we feel it
needs to we need to work hard you know
trying to improve it against our peers
uh there seems to be a lot of and compar
against UPS lot of opportunity for
upside so you know that's for you to do
your
work we can only do our work and and we
hope that there will be some uh some
interest in the market you
know
on you know there's also one more thing
that seems to be happening in the market
right now and that is uh
I think there is irrespective of all the
the ESG and climate change activism and
all of that people are now beginning to
understand that oil and gas is an
important part of the energy mix it's
becoming and and more and more um
prominent people are are saying making
more and more bold statements about this
so I think that's very important so
hopefully very and you can see I mean
Warren Buffett keeps increasing his
stake in the oil companies yeah yeah he
he keeps doing it the big mergers that
you see in the US I mean why why are
these big mergers happening because they
want to have the scale to be able to be
extremely competitive in this market and
and and and do things in a Consolidated
way have Consolidated strategies and
another reason why it's happening is
because of the security risk in the
Middle East I think uh I think uh you
know the the Western World wants to have
a a secure source of energy and they
want to know where where it's it's going
to come from so I think that's also
important interesting to see that in the
last two weeks Germany committed to a
huge uh 10 gaws of power electricity
Supply coming from combined gas turbines
gas generation and and they 10 gaws okay
so this is a country that was committed
to Renewables uh completely uh
decommissioned its nuclear facilities
and now going back to gas turbines and
you must ask yourself 10 gaw of
electricity from gas turbines where is
the gas coming from and and uh they
building now even the the LG import
terminals to accept to receive that gas
so so they need reception centers for
the gas so it's going to come from
somewhere be imported so uh and and
there's going to be demand so I think uh
surely surely over the next uh I would
say 10 years our industry We Believe
will still be strong so I think I think
with that I I include conations and
hopefully all the others are ready to
take your
questions
yeah going to the Q&A so I think there's
a there are three questions from John Po
from insights the first one is over the
medium term it seems that the growth
will come from many infield and some new
blocks are there
Brown fields that deem attractive on the
radar for the team what will be the size
of recation that's comfortable for hus
without an equity raise
or um okay so I think I'll do this
together with Pascal and deart probably
and and please chime in okay but I
think long and short is as I said we are
the the target has been set for us
35,000 to 50,000 equivalent a day by
2026 uh within our own P folio we will
probably get to somewhere in the range
of what 28 30,000 barrels of oil
equivalent a day if we do all our
development activities by that time so
there's going to be a gap to close uh we
are determined to close that Gap and
meet our objectives therefore at some
point we will make some
Acquisitions uh the process we are
looking all the time and there are
processes ongoing in different parts of
the region right now but not to say
we're in it or whatever but we we are
definitely interested to to
participate and what has always been
important for us is to get the right
asset at the right price and at the
right time because right right price and
right time come together okay uh Right
Price Right Time important okay because
um you you can't pay at the peak of the
oil prices and all of that kind of stuff
so it's got to be a reasonable
transaction uh I I so I guess the answer
is yes we looking at Acquisitions all
the time okay yeah is there a size of
acquisition that's comfortable for H
visus without an equity
rise there is s well I mean
uh think we know what we are trying to
achieve in terms of a Target we're
trying to close a gap of about 10,000
bar of oil equivalent a day actually
that's what we're trying to do so I
think let's start with what is the
objective and if it's a good transaction
it should be reasonably uh debt fund I
think we can still find money in from
the market for debt so it's got to be
reasonably debt fundable and and I think
it's in everybody's interest including
some of the management here not to not
to have too much of
dilution and the second question is is
the management satisfied with the
reserve replenishment activities that
planned over the next three to five
years I mean for the first time a long
time we're actually drilling
exporation we're actively seeking for
new resources to add to our
portfolio and if you remember that's how
we started as a company it's essentially
exploration now added it back to our to
our work program um besides that of
course the development activities we're
actively developing the sf30 water FL
which been add significant number of
barrels and we have additional
developments in the pm3 area as well so
yeah in terms of activities it's it's
actually quite a high level compared to
where we were before so the in terms of
resources I think we have plenty the bag
to to develop over the next five to
seven years okay and the third question
is will share buy back continue
throughout fy2 24 and fy2 at this
prices we have a certain trold that we
thinking about and we are opportunistic
about it um and we have set aside budget
to undertake share BuyBacks for this
financial year we um and we will
continue to monitor our share price
and John I hope that answered your
question raise his hand Dr you want to
unmute yourself and say your
question hey um hi hi everyone um just a
quick follow up on the exploration
talk uh so going forward should we
expect more exploration and would it
only be done under the um the cost kind
of sharing mechanism or would we also be
open to um taking out all of you know I
guess underwriting the the expenses
ourselves yeah so um I think um that
that's a good observation because um the
exploration work we are doing now uh we
drill the B latara well last
year under hibiscus Malaysia and it came
in above expectations and it was
immediately put into production it was
it was planned in such a way that it
immediately was was tied into the
production Network and started producing
right away so that was very successful
well it's it's been the subject even of
a case study for for Petronas they they
bring it up a few times now and uh now
we we are working on on the uh the not
the nor Saba nearfield exploration
opportunities this one will not be TI if
if it's successful and the results are
good then we will we will not be able to
tie these in right away they will need
further work uh and and that that those
studies and all these things are you
know we we will have to do them in due
force and make the announcements but
next year there is the bua ASA well uh
in Peninsula Malaysia sorry this year
I'm I'm still thinking 2023 next month
we're going to be drilling Bas so that's
another exploration opportunity all of
these Wells that we have drilled from
last year to this year are all cost
recoverable so we we've kind of worked
very hard to get them all all in the
cost recovery bucket so so uh our our
exposure is limited okay now uh
regarding uh real kind of rank
exploration opportunities where we take
up new blocks and and and do some
exploration uh that will
only only happen if we Farm into blocks
where we feel that the that there's
going to be really a high chance of
success or at all there are going to be
tieback opportunities to infrastructure
which is already nearby and and which
maybe we are operating I think that
could potentially be a a scenario we we
have to think about that
uh maybe in the in the midterm I
wouldn't say it's something we're going
to do tomorrow but we will think about
that in the midterm has our financial
Foundation gets stronger we will be able
to do that but uh it is it is clear that
you
know it it's not at these oil prices
you're not going to be able to get easy
opportunities you're going to have to
step out a little bit of your comfort
zone of our comfort zone and take a
little bit of near field exploration
some like what we're doing in not Saba
it's clear because oil prices are $75
$80 everybody is thinking let's hold on
to them and and and generate some cash
so uh unless you're willing to to step
out a little bit and and do a little bit
of exploration to really enhance value
it is difficult can imagine to buy an
asset and to recover enough money uh to
make that that acquisition uh you know V
viable and and and become a good appli
so okay um no thanks thanks uh and
regarding the UK um what I think there
was five uh what is it called there was
five blocks right would any of them add
to your reserves or uh
resources yeah so the the blocks that we
have the crown the crown license adds to
our add to our contingent resources
Kil Ramy uh block will add to our
resources so yes uh they are adding to
our resources okay but it's not there
yet right in the we we have not put the
numbers yet because we need to do some
technical work but there are wells been
drilled and discoveries made and our our
gut feeli is that they will they will
add to the Consol Consolidated volumes
of the marold area to make it a more
exciting uh uh area to kind of invest in
okay great and last question for me is
regarding this exploration um Wells so
I'm just going to be a bit cheeky here
but you've drill two already or I guess
almost three wouldn't you have already
some sort of data on like the flow rate
like would you already know if it's uh
you know if it's interesting or not at
this
point
um yes and no we I
mean you you have to do the technical
work the partners have to agree and and
then when you come out uh you know it's
not us it's it's ourselves the partner
and and also the the regulator all have
to agree that there that those technical
work is sound and and this is the answer
uh we are not quite there yet let's just
say that for now okay great thank you
har from menu live you have a question
okay um Can management talk about the
progress of extension of pm3 CAA is
there some kpi in order to get the
extension yes um so this is actually
actively ongoing at the moment um we
recently in January we had a um
essentially regulatory meeting with both
p and
all parties agre that the aim is to
cap actually key principal agreement in
place by this
year we set an internal Target to try
and achieve this faster than the end of
the year but B out of our hands you know
exactly where we want to be but uh We've
also kind of set the bar uh to the point
where everybody understands that longer
it takes to get the U the principal
agreement in
place uh
the longer uh ESS developments will be
deferred which will cause a drop of
production eventually so no nobody's
interest I think all parties are now
working quite diligently to trying to
reach a point where we can
sign I hope that answers your question
T from Trident analytics um there's a
question what is the one thing that can
keep the management awake at
night those
who
well firstly are we
[Laughter]
sleeping yeah say what keeps you
away you got to make sure that
everybody's always focusing every day
health and
safety John hi John you want to unmute
yourself hi good
evening perhaps this is a question
directed to Dr Ken and Dr SC um I I like
the observation that uh Dr Ken mentioned
about going beyond what is a comfortable
risk um I just like to get your thoughts
on perhaps geopolitical risk around the
region in terms of you know um if there
were blocks available let's say in
Vietnam or
whatsoever in terms of your risk
assessment to take on those blocks um
how does geopolitical risk actually take
you account Vietnam is just an example
but when you guys look at blocks that
are you know existing Brownfield maybe
not so prolific uh World geopolitical
tensions actually play a vital role in
deciding and determining whether there's
a good price
not um yeah it always does uh two things
actually one geopol geopolitical risk
and the other is uh legal regulatory
risk you know how stable is the legal
the legal framework in the country in
case something goes wrong uh is there a
decent court system in the country first
at at that level we look at it and then
obviously on a regional level we do look
at you know a few things we look at uh
we look
at I would say apart from the regulatory
list we're looking at Regional
geopolitical race like all the stuff
that you talk about we don't want to
ever get into position where we have to
call Force measure on something we don't
want we want to try and avoid that so
all of that we we also look at you know
long-term U I would say decommissioning
uh rules because if we go in for
something that is going to be 10 years
down the road we got to clean it up we
got to also look at you know what are
the risks associated with that what are
the what are the expectations of the
government when you come to clean up and
all of it uh what levels of of De
commissioning do they want so we we look
there are several factors that kind of
govern you know our decision to invest
in a particular area uh and and the
final one I would say is this which is a
consideration what happens if it all
goes wrong so we we we look at it and
say what happens it all goes wrong and
you have to write it off would the
company be able to still survive on the
the other assets from you know the other
assets that we have so we we look at it
from that perspective okay so I I would
say there there are several several
layers that we look at it but you know
if if we had to write off an asset
because of of some geopolitical thing
that comes up there or whatever would
the company be able to to to kind of
still stand on its feet so these are the
the these are how these are the some of
the factors that kind of you know we
think about when we are going into a a
particular asset so sometimes you have
very attractive opportunities but
yeah they just don't fit you know into
those into that framework us for one
reason or the other just in our
commitment with transparency going
forward we'll be releasing the F webcast
I the recording of This briefing on our
website the day after the briefing so
for this quarter that will be tomorrow I
decided to keep this under wraps until
after the briefing just in case some of
you are tempted to sleep away early for
Chinese year dinner and catch up on the
recording later but thank you once again
for being here if you have any questions
feel free to reach out to us of PR and
take care and stay safe bye-bye
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