New Zealand Oil & Gas is keeping alive its hopes to find investment for its joint venture, deepwater oil and gas prospect 60km off Oamaru.
Yesterday, New Zealand Oil & Gas (NZOG) reported revenue from ordinary activities was down almost 30%, from $41million to $29.2million, and a loss of $18million for its six months trading to December, but clawing back from last year's $27.5million loss.
NZOG is yet to count the $168million proceeds of its sale of the Kupe field to Genesis Energy, and will in May be returning $100million of capital to shareholders, all of which will be accounted for in its full-year report.
NZOG chairman Rodger Finlay said the net loss of $25.4million was mainly due to Cue's impairment of its Maari asset, at $7.7million, and a $2million loss on Cue's sale of its loss-making Pine Mills field in the US. New Zealand Oil & Gas has a 48.11% controlling interest in Cue Energy.
There were also lower receipts from the Tui field because of production decline, production outages at the Kupe and Maari fields and $9.5 million associated with de-recognition of deferred tax assets related to Tui and Kupe.
NZOG chief executive Andrew Jefferies said the company was entering a new stage following the sale of major assets Kupe and Tui.
''We achieved incremental value for our legacy assets and now have a lower cost structure in the business, including a reduced executive team and lower corporate rental overhead,'' he said.
Growth would be achieved by deploying NZOG's remaining cash, after returning $100 million to shareholders, to acquire quality assets at a scale, risk-profile and price suiting its size.
NZOG was also participating in two potentially ''transformational'' deepwater prospects off the South Island, including the deepwater Barque prospect off Oamaru.
Last month, NZOG upgraded estimates at Barque, that it could hold 11 trillion cubic feet of gas and 1.5 billion barrels of oil or gas condensate liquid, saying at the time it was looking for a partner, not putting the asset up for sale.
''This prospect alone could transform the national economy if it is successfully drilled with partners to help share drilling costs,'' Mr Jefferies said.
NZOG and Beach Energy each own 50% of Barque.
Craigs Investment Partners broker Peter McIntyre said an upswing in commodities, including oil, was expected in the next three to five years, Underperforming offshore hedge funds were likely to go back to commodities.
''It's all very well for NZOG trying to buy into existing operations, but it's got to have some exploration capacity.
''It's likely Clipper is one of the last things it would want to give away,'' he said.
