Right on Cue
By combining its high-quality, cutting edge exploration know-how with its ambitious pursuit of growth, Cue Energy Resources has become one of the best known E&P juniors within the Asia Pacific region.
With a clean balance sheet and no net debt, it’s no surprise that Cue Energy Resources has been catching the eye of potential investors.
This oil and gas junior operates in the exploration development and production of hydrocarbons with a broad regional focus on Southeast Asia and Australasia.
With petroleum assets in Papua New Guinea, Indonesia, New Zealand and Australia, the company has been able to grow thanks to the revenues generated from its sale of gas and liquid hydrocarbons.
Established back in 1981, in recent years Cue’s management team has overseen a mixture of acquisitions and discoveries, demonstrating the firm’s true potential by making the most of the right opportunities it has been presented with.
The company is led by chief executive Mark Paton, who previously helped Upstream Petroleum grow from a tiny company until it was sold to Norway’s AGR Group for A$85 million in 2007, and chief commercial officer Alex Parks, who is tasked with discovering new opportunities.
In 2011 the company was responsible for the production of 420,000 barrels of oil and 2.6 billion cubic feet of gas, and has estimated reserves of around three million barrels of oil and 120 billion cubic feet of gas.
Despite having acquired relatively large reserves, Cue has shown no desire in slowing down its hunt for hydrocarbon exploration and production opportunities.
The company has interests in five exploration permits in the Carnarvon Basin, offshore Western Australia.
Cue has operated all of these permits during the early exploration phase and has been successful in farming out all of the permits, maintaining equity, and reducing exploration risk and funding commitments.
Having participated in two wells and multiple 2D and 3D seismic surveys, the focus is now firmly concentrated on the Triassic structural and stratigraphic gas play.
Cue currently has interests in two Petroleum Retention Licences in Papua New Guinea, as well as a Petroleum Development Licence and one field unitisation in the SE Gobe oil field.
The firm currently produces oil in the country at the SE Gobe field and hopes to one day produce gas from this field as part of a potential major LNG project.
In Indonesia, Cue was an original participant in the Sampang Production Sharing Contract (PSC), which was signed back in December 1997.
Located close to Indonesia’s second largest city to Surabaya, Cue expects energy demand in the area to grow substantially in the coming years.
At the Oyong Field, the firm is currently producing approximately 3,000 barrels of oil per day and 60 million standard cubic feet per day of gas. Its more recent Wortel discovery, located next to Oyong, began producing gas late last year, further increasing the company’s Indonesian output, with evaluation at the Jeruk oil discovery also underway within the country.
Its New Zealand properties include interests in one producing permit in the Maari/Manaia Oil Field and two exploration permits (PEP51149, PEP51313), as well as a 5 per cent working interest in PMP 38160, which contains the Maari and Manaia Oil Field.
It also has a 20 per cent interest in PEP51313, containing the large Pike and Te Whatu prospects, and a 20 per cent interest in PEP51149, which encompasses the Te Kiri and Pungarehu prospects.
During the fiscal year ended June 30, 2011, Cue had produced 30,998 barrels from the SE Gobe oil field and 2.93 billion cubic feet of gas from its Oyong field.
These large amounts were followed up with the company’s large share of oil production from the Maari field, which as of June 30, 2011, stood at 269,680 barrels of oil.
The company’s ambition can be summarised by its objective to become a robust and substantial E&P company with a market capitalisation in excess of $1 billion.
By maximising the value of its existing assets, building on its organisational capabilities and aggressively pursuing new E&P assets, the company has been able to close in on these targets.
It has developed a balanced portfolio of exploration, development and production opportunities, and is aiming to increase its stake in its assets from the current level of around 20 to 40 per cent up to 30 and 50 per cent.
Cue’s ability to take up operatorship as and when required, as well as its ambitious approach to business, has led it to actively pursue value accretive mergers and acquisitions.
Having been on top of its game for more than 20 years, Cue looks likely to continue building its reputation and assets in the same ambitious vain over the next two decades.