Beach Energy has downgraded its 2021 financial year production guidance to 25.2-25.7 million barrels of oil equivalent (MMboe) following challenges earlier this year.
Managing director and chief executive officer Matt Kay said the quarter had delivered challenging results for the business, with a number of challenges across its Western Flank oil and gas asset.
“The past five years has seen the Western Flank outperform our expectation, but we are now witnessing underperformance from a number of fields,” he said.
“This has had a negative impact on our production for the quarter, as well as our FY21 production guidance and Western Flank 2P oil and gas reserves.”
Kay outlined that the previous reserves assessment across the Western Flank had proven to be optimistic following drilling results, but following experts assessing its work, it resulted in a net downgrade of about 5 per cent of its FY20 2P reserve.
Despite the performance of the Western Flank, the quarter also delivered some results across the broader business.
“We have a strong balance sheet to support us as we deliver our two key growth projects, the Waitsia gas project stage 2 and the Victorian Otway development campaign, as well as other potential development, including Trefoil in the Bass Basin,” Kay said.
“The highlight has been a second gas discovery at Artisan 1, and we have also completed the top holes at Geographe 4 and 5, with drilling at Geographe 4 underway.”
In addition, the report advised that production volumes were also lower across the Kupe and Cooper Basin joint venture assets due to lower customer nominations, planned and non-planned outages and natural declines.
The company reported that this was offset by higher production from the Perth Basin gas assets, the acquisition of Senex Energy’s Cooper Basin assets, and the planned acquisition of Mitsui’s interest in Bass Basin assets.