Oil and gas exploration and producer AWE Limited (ASX:AWE) has reported a significant fall in its revenue and production in its March Quarterly report released on Wednesday. Quarterly production came in at 1.11 million barrels of oil equivalent (MMboe), a 6 per cent decrease compared to the previous quarter. In the nine-month period up to March 2015, oil production fell 15 per cent compared to the previous corresponding period. The production guidance in the financial year to date came in at 3.67 MMboe, in line with guidance. Quarterly sales revenue came in at $41m, down 46 per cent compared to the $77m revenue from the previous quarter. The fall in revenue was attributed to lower production and significantly lower oil prices.
The company realised an average oil and condensate price for the quarter of A$57.33 per bbl compared to A$80.78 per bbl in the previous quarter. The company had net debt of $47m at the end of the March quarter. It also had $62m in cash and $109m of drawn debt from a $300m loan facility. There were no reported environmental incidents during the quarter. AWE received two new offshore exploration permits. The permits were awarded in Western Australia. An additional exploration permit was approved in New Zealand as well. “The lower oil price received during the quarter has impacted on sales revenue and cash flow. In this environment, the company is aiming to further reduce costs across the business, with significant savings already achieved on Sugarloaf drilling and completions and opportunities identified to reduce operating costs on a number of assets,” said managing director Bruce Clement.
Shares of AWE are up 3c, or 2.22 per cent, at $1.38 per share near the end of trading ours on Wednesday. AWE has fallen over 13 per cent in the last 12 months but has risen over 7 per cent so far this year.