Australian Senex to Make A$80mn Impairment

Australian Senex Energy said February 20 it expects to recognise a non-cash impairment charge of A$80mn ($63mn) in its 2H 2017 results to be released February 22 in respect of non-core Cooper Basin exploration assets.

Senex said it is completing a comprehensive asset portfolio review to prioritise future capital allocation to accelerate gas project development. It further stated that its Australian east coast gas business will drive major production and earnings growth from 2019.

Following asset portfolio review, strategic focus and capital allocation will be prioritised to core assets to drive growth through company’s east coast gas development projects and Cooper Basin oil assets.

Atlas coalbed methane project

In September 2017 Senex was awarded coal seam gas acreage (Project Atlas) by the Queensland government following a competitive tender.  The Project Atlas acreage contains 201 petajoules of recoverable gas from highly productive coal seams, to be delivered into the domestic east coast gas market from 2019.

“The accelerated development of Project Atlas in combination with development of the Western Surat Gas Project and Cooper Basin core assets will deliver a step-change in production and earnings for Senex from calendar year 2019,” it said, adding that corporate and development financing discussions with lenders are progressing positively and on schedule for financial close in mid-2018.

“We are embarking on major investments in our Surat Basin gas projects that will provide very material production and earnings growth in the near term, and importantly deliver additional gas supply to the east coast of Australia. Our announcement today (February 20) underscores our focus and commitment to achieving superior results from our suite of core assets,” Senex CEO Ian Davies said.