Soaring oil and gas prices power Jadestone Energy’s revival
Jadestone Energy (Jadestone) has enjoyed a 56 per cent boost in revenues, which have climbed to $340.2m, following a boom in commodity prices.
Its average realised price for its oil products over the course of 2021 rose 66 per cent year-on-year from $44.79 barrel to $74.34 barrel, with markets rebounding from the pandemic amid increased consumption demand.
The Asia-Pacific fossil fuel trader has also ramped up production 10 per cent to 12,545 barrels per day of oil equivalent, in line with analyst expectations.
During the 12-month window, the company confirmed multiple acquisitions including the purchase of the Peninsular Malaysia assets for $24.5m, which contributed 2,539 barrels per day of oil equivalent.
It also executed a settlement and transfer agreement with DP Hexindo Gemilang Jaya in November to acquire the remaining 10 per cent interest in Lemang PSC, for $0.5m, with the deal expected to completed in the third quarter of 2022.
Total production costs at the firm have spiked to $206.5m, significantly above the $105.3m in 2020.
This was partly due to its acquisitions, but it was also driven by its Skua well workovers programme – which spiked to $47.2m, alongside the well workover programmes at Stag and Montara of $19.8m.
Meanwhile, increased repairs and maintenance nearly doubled to $40.1m from $22.5m.
Despite the increased operational costs, the commodities boom ensured the company enjoyed a hefty cut in its losses – with net loss after tax falling from $60.2m in 2020 to $13.7m last year.
At year-end Jadestone has recorded cash-balances of $117.9m – a 32 per cent boost on last year’s figure of $89.4m.
Proven and probable reserves at year-end 2021 totalled 44.7m barrels of oil equivalent, a 20 per cent increase on the end-2020 figure of 37.1m barrels of oil equivalent.
lt has recommended a final dividend of ȼ1.34 per share, equivalent to a distribution of US$6.3 million.
This means the company paid out total dividends of $9m last year.
lt now intends to return up to $100m in cash to shareholders over the next 12 months, in the form of ordinary dividends, share buybacks and tender offers.
One remaining source of frustration for the company is the continued delays in its proposed acquisition of a 69 per cent in a New Zealand oil project.
In 2019, the group executed a sale and purchase agreement with OMV New Zealand Limited for the majority stake in the Maari project for $50m.
The project is located 120 km off the coast of New Zealand, in a water depth of 100 metres.
However, the company has not yet managed to secure ministerial consents from the New Zealand Government, including the approval for transfer of operatorship – nearly three years later.
Alongside its headline results, Jadestone has announced a commitment to net zero scope 1 and 2 greenhouse gas emissions from its operated assets by 2040.
President and chief executive Paul Blakeley said: “We believe that our corporate strategy is well-suited to the energy transition, delivering essential energy from existing discovered and producing fields, and as a responsible operator with a demonstrable track record of delivering asset performance to the highest standards, providing confidence to sellers and host governments alike.”
The company trades on the FTSE AIM 100 Index at the London Stock Exchange – where its shares dropped around five per cent.