Vancouver, British Columbia, February 14th, 2019. Newport Exploration Ltd (“Newport” or “the Company”) is pleased to provide an update on gas production and drilling activities on permits and licences in the Cooper Basin, Australia over which the Company has a 2.5% gross overriding royalty (“GOR”). This information was released by Beach Energy Ltd (“Beach”) (ASX: BPT) in an ASX/media Release dated 13 February 2019 and in their Half Year Report for the Six Months Ended 31 December 2018.
Beach report that Western Flank Gas operations accounted for 6% of their First Half of FY2019 (“H1 FY2019”) production. The producing permits are ex PEL 106, ex PEL 91 and the Udacha Block, all of which are subject to the Company’s GOR. Western Flank Gas production was 1.0MMboe, a 55% increase over the prior half year largely as a result of the commissioning of the latest Middleton Facility capacity expansion.
Beach participated in one Western Flank gas well in H1 FY2019, the successful Webb-1 well. Spondylus 3-D prospects have been identified and a seven-well gas appraisal campaign in the core gas production area is set to commence in March 2019.
GAS FACILITY UPGRADES
As previously reported by the Company (News Release dated January 31, 2019), Beach and Santos Ltd (“Santos”) have agreed an extension of gas processing and related gas liquids purchases at the Moomba gas facilities. The Gas Processing Agreement with Santos has been extended for 3 years and is expected to provide capacity for all Beach-operated Western Flank Gas to be processed at the Moomba gas facilities over the three-year term of the extension. In the same news release the Company reported that Beach had executed Gas and Sales Agreements to supply Western Flank gas to Liberty Primary Steel, Adelaide Brighton and Alinta Energy. Under these agreements, Beach’s expected 2019 Western Flank sales gas production is fully contracted at prices reflective of current market conditions.
The Company has held its interests in the Cooper Basin permits since 1998. Much as it believed in the technical merits and potential for oil discoveries in the Cooper Basin GOR permits for over 15 years, despite poor initial results and little exploration activity, the Company believes that the gas potential of the permits may soon now be realized, as suggested by an aggressive drilling campaign by Beach, upgrades at both the Middleton and Moomba gas facilities, and the execution of numerous gas sales agreements.
Reference should be made to the Beach and Santos websites for their interpretation of the results and plans to bring wells into production.
The Company receives its GOR from Beach, who is not a reporting issuer in Canada, and therefore, not required to comply with the requirements of NI 51-101 – Standards of Disclosure for Oil and Gas Activities hence, Newport is not able to confirm if the disclosure satisfies the requirements of NI 51-101 – Standards of Disclosure for Oil and Gas Activities, or other requirements of Canadian securities legislation.
The Company is unable to forecast potential productivity for each well and continues to strongly encourage shareholders and potential investors to access information released independently by Beach and Santos to keep current during exploration, development and production guidance for all permits subject to the Company’s gross overriding royalty.
For further information contact:
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the accuracy or adequacy of this news release.
Cautionary Statement on Forward-Looking Information
This news release is intended to provide readers with a reasonable basis for assessing the future performance of the Company. The words “believe”, “should”, “could”, “expect”, “anticipate”, “contemplate”, “target”, “plan”, “intends”, “continue”, “budget”, “estimate”, “may”, “will”, “schedule” and similar expressions identify forward-looking statements. Forward-looking statements may pertain to assumptions regarding the price of oil and fluctuations in currency markets (specifically the Australian dollar). Forward-looking statements are based upon a number of estimates and assumptions that, which are considered reasonable by the Company, are inherently subject to business, economic and competitive uncertainties and contingencies. Factors include, but are not limited to, the risk of fluctuations in the assumed prices of oil, the risk of changes in government legislation including the risk of obtaining necessary licences and permits, taxation, controls, regulations and political or economic developments in Canada, Australia or other countries in which the Company carries or may carry on business in the future, risks associated with developmental activities, the speculative nature of exploration and development, and assumed quantities or grades of reserves. Readers are cautioned that forward-looking statements are not guarantees of future performance. There can be no assurance that such statements will prove to be accurate and actual results and future events could differ materially from those acknowledged in such statements.
The Company disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events or otherwise, except to the extent required by applicable laws.