OK here are the numbers.
Extracting the relevant information from the quarterly report
Average daily production was 590 bopd. There were 92 days in the quarter so the quarterly production is 54,280 bbls. This was the total production for the JV. Remember TEG report on their 57.5% equity share only in the quarterly report figures.
So TEG’s share of quarterly production is 31,211 bbls.
How much money would TEG get from this production using the quarterly reported figures. The report said that the JV received USD4.6 million for sales of 50,756 bbl. That means the average price received was USD90.63/bbl. You can use the TEG reported revenue in the quarterly report to calculate an average exchange rate of 0.67 AUD/USD.
The average A$/bbl received is 90.93/0.67 or A$135.45/bbl
What is TEG’s share of the revenue associated with the quarterly production (31,211 bbls). Using the above figures, you get $4,227,458 AUD. Don’t confuse this with what was the reported revenue in the quarterly report. The quarterly report is for revenue they received for actual sales.
How much did it cost to get this $4,227,458 revenue. These numbers are in the quarterly report
Production costs were 3,626,000 AUD, Staff costs were $720,000 and Admin and corp costs were $963,000. Add them up and the Total is $5,309,000
The loss is $1,081,542.
Putting it another way the numbers will show that the costs equate to $A170.1/bbl for the quarter and they received $135.45/bbl.
Every bbl of oil that cliff head produced in the September quarter lost $34.65 in real cashflow.
At 590 average bbls per day, keeping cliff head flowing is costing TEG $20,445 each and every day.
Do you own sums
Also just look at the cash position from the June to the Sept quarter and you will see that the above is true.
Cliff Head loses money every day. The JV cannot afford to shut it in and spend all the funds to make it safe. They are hoping they can repurpose it but need government approval before they lose too much money. As shareholders this is your reality. Think about how the problem become worse if there is a major breakdown or loss of a well.
Is the risk worth taking.
(20min delay)