BEACH ENERGY
1Adelaide-based Beach, with a history dating back to 1961, is Australia’s largest onshore oil producer. Its main focus has been the Cooper and Eromanga basin regions of South Australia and Queensland, and it also maintains an active exploration and development program in other areas of Australia and in New Zealand. Having undertaken a major restructuring of its operations, it has now been seeing the benefits in sharply higher profits. It has reduced Cooper Basin operating costs by 20% and cut staff numbers by 11%. It has sold low-margin businesses, including its Egyptian oil field and much of its interests in Queensland.
However, it is now set to be transformed by the planned $1.59 billion acquisition of Lattice Energy from Origin Energy, announced at the end of September 2017. This delivers it a major portfolio of gas production and exploration assets on Australia’s east and west coasts, as well as in New Zealand. The acquisition will generate strong cash flows for Beach, as it incorporates a number of long-term gas sales agreements, with Origin, AGL Energy and Alinta Energy in Australia and with Genesis Energy in New Zealand. Beach now forecasts production for the June 2018 year of between 25 million and 27 million barrels of oil equivalent (boe), compared with 10.6 million boe in the June 2017 year. It also means a trebling of the company’s reserves, and through continuing exploration work and strategic partnering provides the potential for substantial long-term growth.