Jadestone Delays Vietnamese Gas Amid Market Turmoil

Southeast Asia-focused Jadestone Energy has delayed plans to develop a pair of gas fields off the coast of southwest Vietnam, cutting its 2020 capital expenditure by around 50% to $80-95mn, it said in a London stock exchange filing on March 19.

Jadestone said its field development plan (FDP) for Nam Du and U Minh had not yet been approved by the Vietnamese government. With no approval imminent, it has decided to push back the project, which would not have yielded any cash flow before the fourth quarter of 2021, to protect its balance sheet. First gas is no longer expected until late 2022, it said.

What is left of Jadestone's capital spending programme covers drilling at the Montara and Stag fields off Australia and this is entirely at its discretion, the company said.

"We are committed to maintaining capital discipline through the current uncertain environment," CEO Paul Blakeley commented. "While the level of economic turmoil is unprecedented, I am pleased that we retain substantial flexibility and will remain nimble, and course correct as necessary, to ensure ongoing value add to our shareholders."

Jadestone's unaudited cash balance was $116mn at the end of January, including $10mn of restricted cash and $50.1mn of outstanding debt. The company said it expected to remain cash flow positive even if oil prices remain below $30/b, thanks to hedging and a price premium on oil it produces in Australia.