Key Petroleum Limited (ASX: KEY) is an Australian oil and gas company engaged in mining and exploration in the Cooper Eromanga and North Perth Basins.
The company announced that a non-binding gas processing Memorandum of Understanding (MOU) has been executed between Key Cooper Basin Pty Ltd (a wholly owned subsidiary of Key Petroleum Limited) with Santos Limited and its relevant subsidiaries and wholly owned subsidiaries of Beach Energy Limited.
This MOU will further help in negotiating the future formal processing and transportation agreement which will allow raw gas to be processed into sales gas from KEY’s Tanbar Gas Project. The gas from Tanbar Gas Project will be supplied to east coast Australian gas market. The terms of the MoU will support potential economic developments of gas discoveries within Key’s Tanbar Gas Project
All the entities who have signed the MOU have agreed to non-binding indicative terms for gas progressing and transportation services. All of the commercial terms are kept confidential and will form the basis for the negotiation of a binding agreement that is to be executed between the parties at a later date.
The Current gross un-risked potential resources at ATP 924 are 150 billion cubic feet (1U) – 500 billion cubic feet (2U) – 950 billion cubic feet (3U).
Currently gas is in shortage which has led the gas prices to surge above A$10.00 per GJ in Sydney and between A$9.00 and A$10.00 per GJ in Victoria and Brisbane is likely to continue. This should result in the prices to remain at higher levels and consequently help in the gas exploration projects on the east coast of Australia.
Kane Marshall, Managing Director, expressed his willingness to work with Santos and Beach Energy, stating it’s a clear direction to the commercialisation of future gas discoveries within Tanbar Gas Project. He also stated the flexibility for the financing of future developments by reducing the estimate of capex intensive gas processing infrastructure being required if Santos-operated infrastructure can process and transport it as per MOU.
On 6th March 2019, the company announced its interim financial report for the year ended 31st December 2019. It reported a loss from continuing operations, but the loss was significantly less than the previously reported loss. In 1HFY19 the loss from continuing operations was $225,555 from the previously reported loss of $608,002 in 1HFY18. This was majorly due to an increase in the revenue from continuing operations which stood at $410,458 in 1HFY19 compared to $188,357 in 1HFY18.
On the balance sheet front, the total assets also saw an increase from $4.06 million in 1HFY19 to $5.63 million in 2HFY18 whereas the total liabilities increased marginally from $3.66 million to $3.81 million in the same period.
On the technical front, the stock is trading 33.33% up at A$0.008 as on 11th March 2019 compared to the previous closing of A$0.006. The stock is trading at the YTD return of 20% (excluding today’s gain).
This website is a service of Kalkine Media Pty. Ltd. A.C.N. 629 651 672. The website has been prepared for informational purposes only and is not intended to be used as a complete source of information on any particular company. Kalkine Media does not in any way endorse or recommend individuals, products or services that may be discussed on this site. Our publications are NOT a solicitation or recommendation to buy, sell or hold. We are neither licensed nor qualified to provide investment advice.