Beach expects $194M in impairments

BEACH Energy is the latest to be hit by asset impairment charges, closely following those announced by joint venture partners Santos and Drillsearch last week.
Beach expects $194M in impairments Beach expects $194M in impairments Beach expects $194M in impairments Beach expects $194M in impairments Beach expects $194M in impairments

Beach says it expects to announce a $194 million non-cash (before tax) impairment to its Cooper Basin interests when it releases its half-yearly statement on Wednesday.

Beach announced last month it expected to get hit by its heavy exposure to two Santos-led joint ventures via Santos' flagged heavy cuts across its business, while conservatively revising its own FY15 guidance range down from $450-500 million to $430-470 million.

Beach's Romanian interests have also now been reduced to nil, with an impairment totalling $30 million expected. Beach said it would not be conducting any further exploration in the region where it acquired Black Sea acreage in 2012.

Santos' impairments for the Cooper Basin producing assets came to $688 million, with a further $70 million expected to drop out of exploration projects in the area.

Santos and Beach are partners in a number of wells throughout the Cooper, partnering up with Origin Energy on the South Australian gas project and the South Australian Cooper Basin JV deep natural gas project.

Beach is also partnered with Drillsearch in PPL 255, and PRLs 151, 172, 136 and 150.

Drillsearch said it expected to record non-cash impairments of $64 million, principally to its interests in the eastern margin/Tintaburra oil assets in the Cooper-Eromanga Basin ATP 299 permit in which it is partnered with Santos.

The charges have been blamed by all three companies on the depressed oil price environment.

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