Amplitude Energy Limited (AEL) Earnings Call Transcript & Summary

We acknowledge the Kaurna people as the custodians of the Adelaide region where our head office is; the Whadjuk Noongar people where our Perth office is and the Eastern Marr people of the Western District of Victoria where our Athena Gas Plant is. We respect the spiritual relationship they hold with their country, and we acknowledge their elders, past, present and emerging. Good morning, ladies and gentlemen, and welcome to this morning's Annual General Meeting of Cooper Energy Limited. My name is Amelia Jalleh. I'm the Company Secretary of Cooper Energy. Before we move to the formalities, there are several housekeeping matters to mention. Today's meeting is being held online via the Lumi platform. This allows shareholders, proxies and guests to attend the meeting virtually. All attendees can watch a live webcast of the meeting. In addition, shareholders and proxies can ask questions and submit votes. Shareholders have been provided with instructions as to how to participate and vote at the AGM with details available in the Notice of Meeting, including guides for how to participate online through your mobile device. You have 2 ways to ask questions. Firstly, online attendees can submit questions at any time. [Operator Instructions] Please note that while you can submit questions from now on, they will not be addressed until the relevant time in the meeting. Please also note that your questions will be moderated, including amalgamated with others if we receive multiple questions on the same topic. Depending on the question asked, the Chairman will decide whether he will answer it or ask a member of management, another director or the auditor to respond. Secondly, you can ask questions verbally after the Managing Director's presentation prior to formal AGM commencing. The Chairman will let you know when the window for verbal questions has opened. During that window, you're welcome to ask questions about any item of business. [Operator Instructions] If you have any issues using this system, please return to the Lumi platform. In accordance with the constitution, please note that the Chairman has determined that all items of business will be decided by way of poll. The Chairman will open the polls now and keep them open so you can vote at any time during the meeting. If you are eligible to vote at this meeting and have logged into the online platform, a new voting tab will appear. Selecting this tab will bring up a list of resolutions and present you with voting options. To cast your vote, simply select one of the options. There is no need to hit a submit or enter button as the vote is automatically recorded. You can change your vote at any time during the meeting up until the time that the Chairman declares the polls closed. The Chairman will give you a clear prompt later in the meeting to let you know when the polls will close. Ms. Doris Grave from Computershare will act as the returning officer for the purposes of conducting and determining the results of the poll. The results will be tallied and checked by Computershare and announced to the ASX later today. The voting icon should appear soon if it hasn't already. Please submit your votes at any time. Following questions and discussion, the Chairman will provide notice before declaring the poll for all resolutions closed, thus allowing sufficient time for votes to be submitted. A recording of this meeting will be available on our website later today. Before handing the meeting to our Chairman, John Conde, we would like to share with you a short video about recent Cooper Energy projects, including information on our sustainability initiatives. [Presentation]

Good morning. My name is John Conde, and I am the Chairman of the Board of Directors of Cooper Energy and will be chairing this meeting. Thank you, Amelia, for the introductions and acknowledgments this morning, and I extend a warm welcome to you all, and thank you for joining via the online platform. We hope you enjoyed that short video and trust it conveyed to you our commitment to climate action and the important role that gas will play as Australia and the world transition to renewable energy sources. We had hoped to be gathering in person this year, but here we are in a virtual gathering again. I hope sincerely that our 2022 AGM will be face to face. I hope you have all endured the last 12 months in safety and good health. But if any of our shareholding family has suffered with this wretched virus, we extend to you and your families our warmest good wishes. Today is Remembrance Day, and we will observe 1 minute silence at 11:00 a.m. Adelaide time. That's in about 20 minutes' time to honor those who lost their lives in the service of our nation so then we all might enjoy the peace and freedom that is life in Australia. Let me introduce to you the company's directors all of whom are present at this meeting, David Maxwell, Managing Director; Tim Bednall, Non-Executive Director; Vicky Binns, Non-Executive Director; Giselle Collins, Non-Executive Director; Betsy Donaghey, Non-Executive Director; Hector Gordon, Non-Executive Director; and Jeffrey Schneider, Non-Executive Director. In addition, we are joined by David Di Blasio, our acting Chief Financial Officer; Amelia Jalleh, who you have already met, our General Counsel and Company Secretary; Derek Piper, Head of Investor Relations; and Darryn Hall, insurance partner representing the company's auditor, EY. We are all either participating from different locations or appropriately distant from each other in accordance with current distancing requirements. The proceedings this morning will be as follows. I will address the meeting and that will be followed by a presentation from the Managing Director. After the Managing Director's presentation, there will be an opportunity for you to ask verbal questions. The formal part of the Annual General Meeting will commence after the verbal questions. The 2021 financial year did not play out as we were expecting. This time last year, my hope was to be meeting with you in person today. I was also hoping that the Orbost Gas Processing Plant would be humming along at something resembling its nameplate capacity. Unfortunately, neither is true. The COVID-19 pandemic continued to evolve in ways that weren't anticipated. It has been a challenging period for us all, corporately and personally. At Cooper Energy, we acted quickly in 2020 to implement procedures and practices to navigate the pandemic, and we continue to monitor, respond and adapt as required. It is pleasing to note that we have had no reported cases of COVID-19 among staff or contractors; we have had no COVID-19-related interruptions to the processing of gas or oil; and we have had no interruptions to progressing our Athena Gas Plant Project. I extend my gratitude to the Cooper Energy Pandemic Response Team and all staff and contractors for their stringent health and safety efforts and for continually looking out for each other. Today, the outlook is much brighter. With the support of high vaccination rates, Australia's borders are reopening and it may not be too long before we can all travel without restrictions domestically. However, there will still be challenges as we adapt to living with COVID-19. The past year was also punctuated by challenges with the Orbost Gas Processing Plant, which is owned and operated by APA Group. Although we have a useful transition agreement with APA covering an extended commissioning schedule, and although we continue to satisfy our customers and our financiers, the Orbost Plant continues to operate below nameplate expectations in terms of stable processing rates. Consequently, we were not able to process and sell our Sole gas at originally forecast levels. This had an obvious flow-on effect to revenue, cash flow and earnings, none of which was as high as planned. This, in turn, negatively impacted our progress with other growth projects. That said, there has been good progress at Orbost. We have seen gradual performance improvements and, also, debottlenecking activities have provided some incremental benefits. However, the issues at Orbost have not yet been resolved, and the plant is only operating at rates of around 45 terajoules a day, which, as we all know, is well short of what was intended. Further works, which I will discuss shortly, are planned by APA for this financial year. We are working constructively with APA to secure certainty regarding the long-term arrangements for processing Sole gas. We look forward to providing clarity on this as the year progresses. The performance at Orbost, however, clearly impacted our share price. And we acknowledge the frustration this has caused our shareholders, and we appreciate the loyalty shown by many. Other external factors. There is increasing pressure in the energy sector for companies to demonstrate their commitment to emissions management. Activism towards the sector is increasing, and accessing funding can be more difficult for companies that do not meet emissions management standards. The messaging crescendo to reduce dependence on fossil fuels and embrace renewable energy sources is loud and getting louder. However, recent global events have highlighted the unintended, although surely not entirely unexpected, consequences of rushing the transition with price spikes for coal, oil and gas. As you saw in this morning's video, Cooper Energy is committed to profitable development in the interest of all our stakeholders. Sustainable development is that which meets the needs of the present without compromising the ability of future generations to meet their needs. The transition to this new world must be done in an orderly manner and with continued investment in cleaner energy transition fuels such as gas. Debate continues about the roles of gas, batteries, green hydrogen, and even nuclear lately, and the part that each will have in supporting continued growth in wind and both small-scale and large-scale solar, and then there's Snowy 2.0, which many people regard as one giant battery. Anything other than an orderly transition will see energy disruptions, that is, blackouts and more expensive power, with the unacceptable consequences for personal, commercial, and industrial life. In summary, those were the challenges we faced last year. COVID-19 and sector pressures were felt by all in the industry. Cooper Energy's performance suffered and was well below all our expectations and budgets. In response, short-term incentive payments were cut significantly across the organization and base salaries have again been held constant for Board and all staff. We've done our best, and it's worth noting that all 4 proxy advisers have recommended shareholders vote in favor of the remuneration report. In amongst the challenges I have outlined, there has been evidence of value growth and upside for shareholders, and I'd like to touch upon some of these. We have maintained a strict focus on delivering our southeastern Australia gas strategy, and in doing so, achieved several key milestones which are transforming Cooper Energy. These milestones include: record annual production, sales volume and revenue; reconfiguration works at the Orbost Gas Processing Plant; first gas sales from Sole under our long-term gas sales agreements; commissioning of the Athena Gas Plant; carbon-neutral certification from Climate Active; and adjustments to our debt facility. These were great accomplishments for the organization, and let me elaborate on some of them in a little more detail. First, we made great strides in establishing ourselves as a gas infrastructure operator with the Athena Gas Plant upgrade and commissioning completed. We are on schedule to commence processing at our Otway -- of our Otway Basin gas through Athena this quarter. The Athena Gas Plant will be a valuable asset within our portfolio as it provides control over gas processing at very competitive costs and extra capacity for the next wave of gas developments. Secondly, we took a major step in establishing ourselves as a material and important supplier of gas to southeastern Australia with the initiation of our Sole gas sales agreements last December and January. With support from our customers and the guiding principles of the transition agreement we negotiated with APA, we were able to commence gas sales to our customers. As a result, a material increase in revenue, earnings and cash flow was recorded in the second half of fiscal '21, and this momentum is continuing in fiscal '22. Since the gas sales agreements commenced, we have met all customer nominations on every day with the support of backup gas supply arrangements and APA's contributions to the cost of that backup supply. To achieve this, Cooper Energy has bolstered its gas trading capabilities, internal management systems and processes. This is another example of the progress we are making as we transition to an integrated gas supplier. Thirdly, we established ourselves as an industry leader on climate action. We received independent certification by Climate Active of our carbon neutral position with respect to Scope 1, Scope 2 and controllable Scope 3 emissions. This confirmed and validated Cooper Energy as Australia's first carbon-neutral gas and oil producer. While many talk of future net zero aspirations, our actions to achieve carbon neutrality have put us some years ahead of our peers. As we grow, we plan to maintain our net zero carbon status and we'll seek innovative ways to harness the momentum in this area. I encourage you to read our 2021 annual report and our separate sustainability report. These documents contain more detail on our progress and our achievements in 2021 and set out some of the challenges for the 2022 financial year and beyond. Let me say a few things about fiscal '22. The progress made last year has set the stage for an exciting year ahead. The foundation for continuing growth is now clear to see: our twin gas hubs are established; domestic gas supply is tight and getting tighter; the Athena Gas Plant has been commissioned; Phase 2b works at the Orbost Gas Processing Plant are underway; and our Sole gas sales agreements have demonstrated the inherent value of the Sole development. The Managing Director will talk to this foundation in more detail, however, it is worth by noting the following. In the Otway Basin, the Athena Gas Plant has been commissioned and will be processing gas this quarter. The plant provides us with operatorship of our own processing facility, with significant capacity for future developments. The Otway Phase 3 Development, or OP3D as we call it, has just entered the Front-End Engineering and Design stage. This will be our first new development to utilize the additional capacity at Athena, resulting in new gas supply for southeast Australia and a step-up in cash flow and earnings for Cooper Energy. We expect this will be followed by further gas discoveries in the basin, which will be at a time when there is continuing gas supply tightness and gas price increases. In the Gippsland Basin, APA will be undertaking additional work at the Orbost Gas Processing Plant, which they plan to complete within the March quarter. The objective of these works is to improve plant stability and the gas processing rate. Extensive testing on solids removal technology provided the confidence to proceed with the installation of the filtration system which is on schedule to occur in January. In the Cooper Basin, our low-cost oil production continues and we are currently benefiting from strength in the oil price. Details of the work program for the fiscal '22 year are being finalized with our joint venture partner and operator, Beach Energy. In the coming year, we will continue our commitment to net zero carbon emissions and pursue new initiatives aligned to this. Our industry-leading net zero position is but one part of Cooper Energy's strategy, a strategy which is sustainable. That means we will be offering a long-term value proposition for all stakeholders while leaving our environment in a better state than we found it. Our assets, strategy and values are aligned, and I'll give you a few examples of this. We produce gas, which we know will be required for decades to come as the world transitions to renewable energy sources. We have consolidated the company's asset portfolio around proven, cost-competitive gas provinces and established infrastructure located close to the key gas markets. We have an extensive resource position, which provides the foundation for increasing production and cash flow. Most of our reserves are linked to long-term contracts, which provide stable prices and cash flow through the take-or-pay terms with our strong customers. We are proud of our environmental track record and the relationships that we have built with communities, which we operate -- in which we operate. Our governance framework and the Cooper Energy values guide all of our decisions and actions. We thank our customers, our shareholders and our lenders and the communities in which we operate for their support and endorsement of our strategic objectives in these important areas. And it's now just on 11, and I propose we pause for a minute's silence for Remembrance Day. "They shall grow not old, as we that are left grow old: age shall not weary them, nor the years condemn. At the going down of the sun and in the morning, we will remember them." Lest we forget. I'd like to make some acknowledgments before I conclude. The progress we made last year in what was a challenging environment across many dimensions of our operations could not have been achieved without the strong support from all of our stakeholders, and I would like to acknowledge them now. First, our lenders have demonstrated continued commitment to Cooper Energy. Earlier this year, they approved adjustments to our debt facility to align it with the current performance at Orbost. A lot of effort has gone into the debt facility for which we are most grateful. Thank you to our lenders, ANZ, ING, NAB and Natixis and most recently, Deutsche Bank, who took over ABN AMRO's syndicate exposure. Our gas customers have been similarly supportive. From accepting a delay to the commencement of our gas sales agreements through to renegotiating some terms and delivery points, as was recently announced with AGL. We greatly appreciate the support we receive from our local communities. In the Otway and Gippsland Basins, farming, tourism and other industries have operated alongside the gas industry for decades. We have proved that gas extraction risks can be managed and economic benefits can accrue to local economies. We actively support our communities and greatly appreciate the support we receive from them in return. Lastly and most importantly, I thank you, our shareholders, for your continuing support. It was unquestionably a difficult year, and your patience during this period has been very much appreciated. We are confident that with APA, we can achieve more certainty around the performance of the Orbost Gas Processing Plant, and that certainty will translate into firmer plans to pursue the many strategic growth opportunities that we have to create value for you, our shareholders. Finally, I record my thanks to my Board colleagues and to our Company Secretary for their counsel and support. In August, we welcomed Ms. Giselle Collins to the Board, subject to confirmation by shareholders at today's meeting. Ms. Collins brings valuable experience to the Board and adds diversity of experience. We have a great Board, and it's my very real honor to be your Chairman working with these fine colleagues. I also record our appreciation to the Managing Director, David Maxwell, and his team for their leadership and commitment to Cooper Energy. We are all grateful for their continued and tireless efforts during this protracted period of great challenges, many of which have been completely beyond their control. And I now ask our Managing Director, David Maxwell, to address us.

Thank you, Chairman, and good morning, fellow shareholders. Our disclaimer is set out on this slide. I will leave it for you to review at your leisure. I'm going to begin my address with a recap of the fundamental drivers for Cooper Energy, our values, purpose and people. At Cooper Energy, our culture is driven by the Cooper Energy values, these values being: care, integrity, fairness and respect, transparency, collaboration, awareness, and commitment. The Cooper Energy values are fundamental to the way we do business. They inform our decision-making and they guide our behaviors. Our values support us in delivering our purpose. The Cooper Energy purpose, our purpose, is to contribute to Australia's sustainable energy future by commercializing gas, oil and other resources for domestic markets. We operate with an emphasis on care, shareholder value and sustainability. Our people are key. They are our enablers. I thank all staff and contractors for their continuing commitment and dedication. The past year has been challenging, and I'm going to discuss this in a minute. Our committed people have helped us navigate the challenges and deliver many key milestones. I'm pleased to say that we have a highly engaged workforce. Our most recent employee survey, which was undertaken in fiscal year 2021, undertaken by an independent organization confirms this. This study was structured around 2 key focus areas: firstly, engagement or the want to; and secondly, enablement or be able to and can do. Cooper Energy's employee engagement score is particularly encouraging and continues to sit high against global benchmarks. The 2001 (sic) [ 2021 ] Sustainability Report, which was published together with our Annual Report, provides more information on our values, purpose and people. I encourage all to read this report. Turning now to our results for the 2021 financial year, which were largely shaped by the ongoing delay in commissioning the Orbost Gas Processing Plant, owned and operated by APA. We achieved record results in fiscal year 2021, however, Sole production, cash flow and earnings were constrained relative to our original expectations. This impacted the progress of our growth projects, financial results and share price. The Chairman has already spoken to the disappointing share price performance. I, too, acknowledge the frustration this has caused. I extend my personal gratitude to you, my fellow shareholders, for your ongoing support through this period. Despite the challenges at Orbost and the continuing backdrop of COVID-19, the 2021 financial year had many highlights and positioned us well for sustained growth. We achieved record full year production, improved safety and environmental outcomes and many key milestones. The initiation of our gas sales agreements and the improving performance of the Orbost Gas Processing Plant drove record production, record sales volumes and record revenue. Production was up 69% to 2.63 million barrels of oil equivalent, sales volumes were up 94% to 3.01 million barrels of oil equivalent, and revenue was up 69% to $132 million. The initiation of our gas sales agreements in the middle of the year was a significant achievement for Cooper Energy, particularly given the volatile performance of the Orbost Gas Processing Plant. With support from our customers, third-party gas suppliers and APA, and guided by the principles of the transition agreement, we delivered over 8 petajoules of gas into our Sole gas sales agreements. During the peak winter gas demand months, we averaged supply of 59 terajoules per day, with Orbost shortfalls sourced from our backup supply arrangements. This sales volume for our Sole gas sales agreement has continued every day since April of this year to today. Beyond the financials, we recorded pleasing health, safety and environmental performance as we strive for continual improvement. The ever-changing COVID-19 situation provided challenges for us all. The policies and procedures we implemented early in the pandemic have served us well, and we continue to monitor, react and adapt as required. We reported no cases of COVID-19 among our staff and contractors. We achieved no COVID-19-related interruptions to our oil and gas processing, and the Athena Gas Plant progressed to schedule. We reported no lost time injuries, although we did have 2 minor safety incidents which resulted in a total recordable injury frequency rate increase. The incidents were a hamstring strain and a cut on the nose. In both incidents, the individuals returned to work the following day. We again had no reportable environmental incidents at our operated sites. We also delivered many key milestones during the year, which are establishing Cooper Energy as a material and important supplier of gas to southeastern Australia, and we are setting the foundation for sustainable growth and shareholder value. These milestones included reconfiguration of the Orbost Gas Processing plant by APA, improving plant performance throughout the year and agreement with APA on the next phase of works. It includes the initiation of the gas -- Sole gas sales agreements that I've already mentioned. It includes significant progress in upgrading the Athena Gas Plant, which is now commissioned and will soon be processing our Otway gas. It includes independent certification as Australia's first carbon neutral or net zero gas and oil producer, and it includes adjustments to our debt facility. These milestones were supported by strong relationships with our key stakeholders, including our customers, banks and the communities in which we operate. Thank you to all for your support. Before we look at the year ahead, it's worth setting the scene with an update on the domestic market in southeastern Australia. The story remains the same, increasing gas supply shortages are playing out as we had expected. Independent forecasts continue to confirm that the gas demand supply fundamentals remain challenged and strongly skewed towards increasing gas supply shortfalls. It is a fact that gas will be needed for decades to come, and that gas will support our transition to renewable energy sources. The video at the start of this meeting highlighted this. Industry and regulators continue to see tight gas supply for southeastern Australia, with a supply shortfall of approximately 60 petajoules expected by 2025. To put that in context, this equates to roughly 4 Sole gas projects at current Orbost processing rates. The shortfall is driven by several factors, including declining production from existing fields as reservoirs deplete; increasing costs and regulatory burden associated with new developments; and various area drilling moratoriums, which have hampered the opportunity for new supply. To have a positive impact on the shortfall come 2025, new gas projects need to be at the final investment stage now or very soon. Similar gas demand dynamics are also playing out internationally. In Europe, where we have the phasing out of fossil fuels over recent years and the consequent underinvestment in new supply, which has contributed to the current spike in prices for coal, oil and gas. This highlights the consequences of not planning the transition to renewable energy sources and the need for balanced and clear policy. We do need to increase renewable energy supply. To ensure this does not disrupt our economies and the cost of living, the transition needs to be orderly, balanced and planned. At Cooper Energy, we are acutely mindful of this. The gas price outlook also remains sound for Cooper Energy. Domestic prices are becoming increasingly linked to LNG prices. Today, over 2/3 of east coast Australia gas production is sold into the global LNG market from the LNG processing units in Gladstone. This is in Queensland. The bulk of the gas feedstock for this comes from Queensland's relatively newly established coal seam gas industry. The Queensland coal seam gas resources underpinned the development of 6 LNG production units and the east coast LNG export industry as we know it today. Meanwhile, declining gas supply from the traditional basins in the southern states has been -- has seen increasing volumes of gas flow from Queensland, in particular in the Australian winter to service peak southern demand. What this means for pricing is that when a gas or LNG producer is assessing the terms for gas supply to their customers, they will be increasingly influenced by the trends in the international gas market. Accordingly, the LNG netback price is having an increasing influence on domestic gas prices. The LNG netback price is calculated by the ACCC. This is the price which is equivalent to the export parity price for a Queensland LNG producer. The ACCC is currently forecasting an average LNG netback price across the course of next year, 2022, of $19.75 a gigajoule. That's Australian dollars. This is not the price in the domestic market, but it is influencing domestic gas prices. Therefore, it's of no surprise that we've seen increases in both LNG prices and domestic gas prices over the course of 2021. The pricing dynamics in the east coast Australia LNG export industry are feeding through to domestic price forecasts at the Wallumbilla Gas Hub in Queensland. In southern states, a further $2 to $2.50 per gigajoule can be added to the Wallumbilla price to account for transportation costs. These dynamics, along with independent price forecasts, confirm our internal view that long-term domestic gas pricing in the range AUD 8 to AUD 11 per gigajoule can be expected. Again, I stress that's for prices for sale to the domestic market. So how is Cooper Energy going to harness this gas market momentum within the southeastern Australia and address the increasing role of renewables and the global drive to reduce emissions? Our twin gas hub strategy is established and our asset portfolio positions us well to become an important supplier of gas for decades to come. An integral part of the strategy is our commitment to climate action. In October of 2020, we announced our objective for net zero carbon emissions, that is Scope 1, Scope 2 and controllable Scope 3 emissions. Our accelerated push saw us achieve this through partnering with Greening Australia in the Coorong Biodiversity Project. Towards the end of 2021, the 2021 financial year, we received independent certification from Climate Active as Australia's first carbon-neutral gas producer. This is a fantastic achievement for Cooper Energy. We are independently certified as a net zero organization using 100% Australian Carbon Credit Units. The feedback has been overwhelmingly supportive. Our staff appreciate it and are proud to be working for a net zero gas producer. Our lenders acknowledge it, and their feedback suggests this will enhance our access to debt markets over time relative to many other oil and gas companies. Our institutional shareholders like it, particularly those who may otherwise be restricted from investing in Cooper Energy. Lastly, our broader stakeholders and communities like it as it reinforces a key element of our commitment to working sustainably. Our focus on maintaining carbon neutrality is one part of our broader objectives in the area of Environment, Sustainability and Governance, or ESG. Cooper Energy adopts the United Nations definition of sustainable development, and this is, "Development that meets the needs of the present without compromising the ability of future generations to meet their own needs." Our objectives are aimed -- aim to create a long-term sustainable investment proposition for our shareholders and be a long-term valuable contributor to our broader stakeholders and the communities. Our twin gas hub strategy is focused on the Otway and Gippsland Basins. I'll talk first to the Otway Basin, which is a proven cost-competitive hydrocarbon basin connected to southeastern Australian markets. During the 2021 financial year, we made significant progress in delivering the upgrade of the Athena Gas Plant. Cooper Energy is the operator of the Athena plant and owns a 50% interest alongside Mitsui E&P Australia. The Athena Gas Plant is a strategic asset, ideally located within the core southeastern Australia gas market and very close to the existing Iona Gas Storage facility. It is an integral asset within Cooper Energy's portfolio. It will allow higher processing rates from the existing Otway Basin gas fields; it will allow lower operating costs relative to current processing arrangements; it will allow significant extra capacity for future developments and discoveries; and it allows enhanced marketing of gas on a firm supply basis. Commissioning of the Athena Gas Plant was completed after year-end. The pipeline cutover is expected to commence imminently, which will redirect gas from the Casino, Henry and Netherby fields through the Athena pipeline to the plant. The pipeline cutover will mean production will be on hold for about 4 weeks. And if all goes to plan, we then expect a smooth ramp-up of production over the ensuring 1 to 2 weeks, with initial production rates from the existing wells reached by the end of December. Completing the Athena Gas Plant will be a significant milestone for your company and will establish Cooper Energy as a midstream gas infrastructure operator. I want to thank all staff and contractors and stakeholders who have contributed to the Athena Gas Plant upgrade. The project has involved significant staff coordination, training and delivery throughout its various stages. Pleasingly, we have recorded no lost time injuries throughout its various stages, and the project stayed within schedule during fiscal year 2021 despite the backdrop of COVID-19. The learnings gained from the project to date are extensive and will prove invaluable as we continue to grow our gas production. On the 3rd of November, we announced that we, together with our partner, Mitsui, have agreed to enter the detailed engineering and design (sic) [ Front-End Engineering and Design ] phase, or FEED, for the next phase of the development and growth in the Otway Basin. This is known, as John said, as Otway Phase 3 Development, or OP3D, and includes the development of the Annie field and further development of the Henry field. In the Otway Basin, we have a broad portfolio of development and exploration opportunities to feed the Athena Gas Plant. The Otway Phase 3 Development, or OP3D, will be the first supply of new gas through the plant. Beyond OP3D, the reprocessing of 3D seismic over the Otway Basin permits was undertaken during fiscal year 2021. Initial observations confirm our enthusiasm for the basin, including confirmation of seismic amplitude support for key prospects. Seismic amplitude-supported prospects are lower risk and past exploration results have proven this. Since 2002, in our offshore permits, there have been 8 exploration successes from 8 wells drilled with seismic amplitude support. More recently, Beach Energy's discoveries, Artisan and Enterprise, provide further validation. When you overlay the current domestic gas price outlook and the fixed cost operating structure at the Athena Gas Plant, you can see why we are excited by the future developments in the Otway Basin. And to illustrate, we estimate annual Athena operating costs of approximately $20 million and current upstream field costs are approximately $5 million. At the initial processing rates, this equates to total operating costs of roughly $2.25 a gigajoule. However, at plant capacity of 150 terajoules per day, operating costs reduce dramatically to less than $1 per gigajoule. After allowing for exploration and development costs, this is the opportunity for long term and sustainable increases in cash flow generation. Hence our enthusiasm for the Otway Basin and the Athena Gas Plant. Now turning to the Gippsland Basin. Our immediate focus is on improving processing rates and the stability at the Orbost Gas processing plant. During the 2021 financial year, APA reconfigured a Sulfur Recovery Unit, which includes the sulfur absorbers, and improved plant performance was delivered during the second half of the year. Processing rates increased from 23 terajoules a day on average in the first half to 35 terajoules a day on average in the second half. Subsequent to year-end, stability has further improved with regular cleaning of the absorbers. The average rate since the end of fiscal year 2021 or since the 1st of July, including the delay -- including the days when parts of the Orbost Gas Processing Plant were down for cleaning, has been 38 terajoules a day. I can advise that the plant's operating at 45 terajoules a day today. APA is undertaking further capital works at Orbost this financial year. The major component of these works is installation of a filtration system, which is on schedule for the March quarter. Extensive testing on filtration technology during 2021 has provided us with confidence that the planned activities can further improve plant performance. For more details, I encourage you to review our presentation and the webcast that we gave and is included on our website. This webcast occurred on the 19th of August this year. Your Board and the executive leadership team are acutely aware of the impact that the poor performance of Orbost has had on Cooper Energy's share price. We are focused on certainty regarding the longer-term arrangements for processing of Sole gas at Orbost. We are working constructively with APA to achieve just such an outcome as advised by the Chairman. Beyond Sole and Orbost, future growth in the Gippsland is expected from the Manta-3 appraisal well and deeper exploration plays in the Manta and Gummy fields. These opportunities are being progressed and will likely be considered as part of the next drilling program. Our financial results -- sorry, our financial position remains solid. We are grateful for the ongoing support of our lenders. Towards the end of the financial year, we adjusted our debt facility to align it with current processing rates at Orbost of 40 to 45 terajoules per day. The adjustments helped preserve liquidity so we can continue advancing growth projects such as OP3D. Bank security for our debt facility is mainly in the Sole 2P, or proven and probable, reserves and the long-term take-or-pay gas sales agreement. The adjustments demonstrate the strength of this position and our lender support for Cooper Energy. We welcomed Deutsche Bank to the lending syndicate at the end of the year. Deutsche Bank took over ABN AMRO's exposure, which follows ABN AMRO's announcement in 2020 of their planned exit from Australia. Detailed due diligence was undertaken by Deutsche Bank before entering the syndicate. Their support is further validation of our business approach, our gas strategy and the growth prospects and risk profile of your company. At the end of the financial year, our cash reserves were $91 million; our drawn debt was $218 million; and the net debt was $127 million. Since then, we have generated positive free cash flow with net debt reducing to $115 million as at the 30th of December (sic) [ September ] this year. The outlook for Cooper Energy is positive. Our industry-leading position in climate action, the dynamics currently playing out in the global energy sector and our asset position are the ingredients for an exciting future for the company. Our growth momentum accelerated in the second half to fiscal year 2021. This was largely due to the initiation of our sole gas sales agreements. The step-change in production and revenue we have been referring to for some time is now underway. Our growth -- as we look to 2022, we expect it will be another year of growth, as demonstrated by our guidance for fiscal year 2022. Specific activities planned for this year include: finalizing commercial arrangements with APA for the long-term certainty needed for processing of our Sole gas; participating in APA's delivery of the next phase of capital works at Orbost, which aims to further improve plant stability and performance; ramping up of production at the Athena Gas Plant to deliver benefits such as higher processing rates, lower operating costs and improved gas marketing capability; new gas sales agreements to support the next wave of gas developments and what's happening at a time when gas supply is tight and gas prices are increasing. Progressing OP3D through FEED and preparing for a final investment decision and progressing other exploration appraisal and development activities within our existing portfolio of growth opportunities. It is clear that gas supply challenges will persist for Southeastern Australia for many years to come. Our twin gas hub strategy and existing asset portfolio provide a clear pathway for discovering and developing new gas supply for the domestic market. Our Otway and Gippsland basin permits are in cost-competitive, gas-producing regions. They include many attractive exploration and development prospects and are connected to customers for our existing processing plants and pipeline infrastructure. These are strategically located assets that will support customers while the gas supply shortfall increases. The key messages I'd like to leave you with today are: Fiscal year 2021 was a year of 2 halves, with our growth trajectory now well underway. We're building a highly cash-generative gas business with exploration and development opportunities to drive sustainable growth. The Athena Gas Plant is being commissioned and is an important enabler for sustainable growth. APA has commenced the Phase 2b works at Orbost, and we have got confidence in the performance improvements as the year progresses. We are in a solid financial position with strong support from our lenders, and the energy crisis currently playing out supports our long-held view that gas will be required for decades to come. In closing, I'd like to report my appreciation to the loyal support of our shareholders, lenders and customers. I acknowledge and thank our employees and contractors for their commitment and effort during the year. My thanks to my colleagues on the executive leadership team for what has been a year of change and growth. Finally, I acknowledge the valuable guidance and support provided by the Board during what was a challenging year. I look forward to providing you with the updates as the 2022 financial year progresses. On that note, I will hand back to our Chairman for the formal part of today's meeting. Thank you.

Thank you, David. I now invite questions from shareholders. Are there any matters or questions that you would like to discuss? As Amelia flagged at the opening of the meeting, you have 2 ways to ask questions. [Operator Instructions]

Mr. Chairman, I've been advised that we have had a couple of shareholders waiting on the line to ask verbal questions since early in the meeting. Thank you to those shareholders for their patience. As the Chairman's commented, we will turn to verbal questions following the written questions. So Mr. Chairman, we do have a few questions to start with -- written questions that is. The first question is from Mr. [ Kenneth Colthill ] who asks, what steps are the company -- is the company taking to plan for net zero emissions by 2050?

Thank you, Mr. Colthill, for your question. And I'd encourage you to look at our sustainability report -- our latest sustainability report. There's an awful lot of information there about what we're doing and what our plans are. Regarding net zero, we've already achieved net zero, and it's been certified by Climate Active. So I think the answer to your question is we're already there and we intend staying there. But thank you for raising the question.

Thank you, Mr. Chairman. Next question is from Mr. and Mrs. Greg who ask, can the foaming issue at Orbost ever be resolved? It has gone on for far too long. It seems to be impeding the opportunity to benefit from current desperate need for gas in Eastern Australia.

Well, again, thank you, Mr. and Mrs. Greg, for your question. Well, this issue, of course, has been front and center of our minds and APA's minds for a little while and a lot of effort has been and continues to be expended in order to get to the bottom of exactly what is going on. The risk of stating the obvious, the foaming has proven to be a pretty complex issue. And neither APA, I guess, whose principal job it is, nor we have identified the root cause. Technical experts have been looking at it and have progressed various analyses, most of which have served systematically to rule out potential causes. And of course, we are hopeful that in time, the root cause will be found. But in the meantime, definite improvements have been made. And we have Phase 2b works underway. And the rest of that program of works will continue into the first part of next calendar year. We are confident, as I believe, is APA, but it's their position to state how they feel about it. We are confident that the filtration system, which is intended to be installed in January, will further improve plant performance. And as was mentioned in both my earlier remarks and the Managing Director's remarks, through the transition agreement that we have with APA and the increased performance that they have managed to get out of the plant, we have -- we commenced gas sales agreements last December and January, and we continue to meet the daily nominations of our customers. So yes, so like you, we would love to know the root cause. And I'm sure that in time, we will. But in the meantime, the focus is on getting process and reliability improvements, and that is happening. We are also producing, as has been mentioned, our own growth projects such as Otway development, the OP3D and that will be able to deliver additional gas supplies into the Southeast Australian market. Thank you for your question. I'm sorry for my lengthy answer.

Mr. Chairman, we have a related question from Mr. Carlos Spinelli, who asks, we continually hear of the issues and the various solutions to the Orbost Gas facility. What guarantees can we have that the next implementation of a solution will, in fact, work and bring us to nameplate capacity or higher as previously claimed?

Thank you, Mr. Spinelli. We don't have any guarantees. It's the short answer. And I don't -- again, I don't think APA has any guarantees. But there's an awful lot of focus and an awful lot of diligent work, experts crawling over it. And as I've said, we are definitely seeing progress in terms of the dependable capability of the plant and improvements in other debottlenecking. And we have been able to meet our customers' requirements, which is fundamentally important to us with the better performance of Sole and with the transition agreement that we have with APA. But as to your simple question as through guarantee, no, I can't give you a guarantee, sorry.

Thank you, Mr. Chairman. The next question is from Mr. and Mrs. Trim, who ask, are dividends envisaged in the next 2 years?

Thank you, Mr. and Mrs. Trim. Well, I guess we'd love the answer to your question to be yes. But our immediate focus continues to be rectifying issues at Orbost and delivering the next stage of growth via OP3D, And we think that's what our shareholders really want. And we think that's the best use of any available capital that it be directed towards those projects. We would hope that after those fairly near-term objectives have been delivered and the business achieves the next step-up in stable cash flow, we'll be in a much stronger position to consider dividends.

Thank you, Chairman. The next question is from Mr. Zhang, who asks how can Cooper Energy have recorded such a disappointing performance over the past 2 years, especially when the gas price is high?

Well, Mr. Zhang, I think we've explained that in the addresses. And certainly, it's covered in our annual report to the issues that have caused us to fall short of where we had hoped to be. I did not seek to resolve from the disappointment we have felt with the performance last year. But as the Managing Director pointed out, it was a year in 2 halves. And from December and January -- last December and last January, we started meeting customer requirements and consequent material improvements in revenue and cash flow. But I think it's fair to say we all share the disappointment you express. And we are focusing very much on addressing the challenges so that we can take advantage of the increased commodity prices, notably oil and gas.

Thank you, Mr. Chairman. We have 4 questions from Dr. Hugos Standish. They're on a number of different subjects. So I might ask them one after the other. Dr. Standish did ask about dividends, which you've responded to. He has asked when Cooper Energy will hedge a profit?

Well, I think I've answered the dividend question, and we're not really in a position to give guidance on when we will be reporting a profit. We see -- certainly see improvements in the company's performance in the coming years. And we would assume that, that will include reporting profits -- profitable operations. So not a precise answer to your question, but it's heading in the right direction.

Thank you, Mr. Chairman. Dr. Standish also asks, would a fancy annual report to be more sensible?

Well, we could not print an annual report at all, I suppose. Thank you for the question. The annual report costs this year were roughly $9,000 for those shareholders who requested a copy of the annual report. And we -- it is available on our website, but some shareholders still request a copy, and we need to provide it. So I think we've cut our costs quite substantially in that area.

Thank you, Mr. Chairman. Third question from Dr. Standish is, how can you sponsor the lifesavers when you don't make a profit?

Well, thank you, Dr. Standish. That's a good question as well. We -- our industry -- just worry about ourselves, operating communities where people really do have an interest in what we are doing. And in the same way that we need their support to conduct our operations, we feel it's reasonable to take an interest in what those community activities are and to show some support. Now I don't think we give any thing that could be regarded as large amounts of support money to any of these community activities, but it is greatly appreciated by the communities in which we are operating. And the support that we have given for lifesavers, which received some publicity, was more an illustration of how a small amount of financial support meant an awful lot to that group of people who volunteer their time and their efforts to save the lives of others. So overall, we feel that it's worthwhile to be positive factors in the local communities where we are having -- where we are conducting operations. So I hope you feel comfortable with that answer. It's greatly appreciated by the local communities and by the charities and not-for-profit organizations that operate in those communities. And the company benefits by having the support of the local communities and that benefit ultimately translates into a benefit for all our stakeholders, including our shareholders. So it's something that we do believe in. We're very measured in how we distribute any such support. But I personally and we corporately feel that it's appropriate. And as I say, it's greatly appreciated.

And the last question from Dr. Standish is, comparing remuneration with peers such as Woodside, Santos and Beach, looks quite equivalent at this point?

Well, our remuneration, like any companies, is considered by our Remuneration Committee, considered by our Board. And it's fundamentally about attracting and encouraging, rewarding and retaining the people that we need to run the business. And we retain external consultants from time to time to benchmark what we're doing. And we are very mindful of responsibility not to overpay people but we're also very conscious of the responsibility to attract and retain good people. And we compete with others in the attraction and retention of good people. And I think, in summary, that's the main explanation. I mean, illustrative of the position in the company was the outcomes this year with regard to incentive payments and starting with the Managing Director, who accepted no incentive payments this year. And I think that's -- I hope that gives you some flavor to what we do in this regard.

Thank you, Chairman. Ms. Mitra asked a question about dividends. She asks how does the shareholder opt for dividend reinvestment options?

Thank you for the question, Ms. Mitra. Well, we don't have any -- we're not paying dividends at present, and we don't have a dividend reinvestment scheme. So you can't opt for the dividend reinvestment scheme. There isn't one.

Thank you, Mr. Chairman. Next question is from Mr. and Mrs. Rigby who ask, as shareholders, we are pleased to hear that Cooper Energy has achieved a carbon-neutral certification. What initiatives has Cooper Energy undertaken to achieve this certification?

Thank you, Mr. and Ms. Rigby. We've talked a little bit about this. So to achieve net zero, we partnered with a group called Greening Australia and in particular, with the subsidiary company of theirs called Biodiverse Carbon, -- And we have -- we are investing in particular projects. So we're investing in what they call their Coorong offset project, which is in South Australia, and that includes reforestation and restoration of around 600 hectares of native vegetation, and that generates Australian Carbon Credit Units, which we then use to offset our emissions. And I think it's fair to say that the Australian Carbon Credit Units, or ACCUs, they're now regarded as kind of the gold standard in this area. And that's the way we have offset our emissions, and we're proud to have done so. We intend continuing to do so. And we continue to review a range of other opportunities to target an ongoing net zero position.

Thank you, Mr. Chairman. Next question relates to OP3D. The question is from the [ Helen Thorpe ] Super Fund. The question is, if you proceed to FID with OP3D, when would be the Henry Gas be available to market?

Well, as mentioned in both the addresses, we are currently in FEED, F-E-E-D. And we are currently working through that design and engineering phase, and that includes costing and funding. And we flagged in our addresses that we'll have more to say on that program at the end of this design phase. We're aiming to have the design phase finished by the middle of calendar year 2022. And at that point, we'd be better able to comment on when there might be an expectation of gas from the fields.

Thank you, Mr. Chairman. From the same shareholder and also with respect to OP3D, what would be the likely cost of developing OP3D? And will there be a call on shareholders to enable development?

It's too early to comment on the specifics of that. That's what we are currently working through. And the answers are dictated by various aspects of the plant, how that is settled by way of design. And I think we can only give you a better answer to that towards the middle of next year.

Thank you, Mr. Chairman. And from the same shareholder, if Orbost can actually be fixed, might nameplate capacity rise above 59 TJs? And if so, can Sole production be increased?

Well, this is a very hypothetical question at the moment. The plant is producing at 45 terajoules a day as the Managing Director mentioned. There are works underway to improve that in various works planned for this fiscal year or in the first half of this fiscal year really with works to be completed on Phase 2b in the sort of January, February time frame. And there is a hope that, that will improve the capability of the plant, but also improve the performance to reduce maintenance and so on. We have rebased a lot of our agreements and projections on the 45 terajoules a day. And we really are not focusing on -- in the absence of a root cause, we're not focusing on the nameplate capacity of 68 terajoules a day. But I think that the focus remains reliably maintaining a throughput from the plant and to reduce interruptions to the gas processing.

Thank you, Mr. Chairman. We have a follow-up question from Mr. [ Colthill ] who asks -- suggests that your earlier answer was a very narrow interpretation of his question. And he would like to know how the company is planning for the time when Australia and other nations have achieved global net zero by 2050 or later with the obvious probable reduction in the use of gas as an energy source?

Well, thank you, Mr. Colthill. I didn't mean to provide a narrow answer, but I don't think I'm in a position 25 years out to provide sort of detailed answer that you may be seeking. We are of the view that there will be a place for our products as a transition fuel as Australia moves to a net zero position. We do not have plans that see us having to or see our product not being required, for example. And I think there are the government and industry generally, whether it's renewable or what the industry may be, there's been no precise plan for how that net zero is going to be achieved. So we are focusing on what our business is, what's in the interest of our shareholders. And we have various near- and medium-term opportunities to create shareholder value as we sell gas, and we sell it into the market as a transition -- as part of the transition process and part of the transition progress. And all indications are there's going to be a strong or an increasing demand for that fuel.

Thank you, Mr. Chairman. Another question from Super Fund, who asks what percentage of Southeast -- of the Southeast gas market is currently serviced from LNG production sources in Queensland?

I don't know the answer to that question, I'm sorry. I'm going to ask the Managing Director if he can throw any light on the answer to that question. I think it's a difficult question to answer.

Thank you, John. The percentage of the Southeast Australia gas market that is being supplied by gas from Queensland is steadily increasing. And it typically is at the highest during the winter months. And without the data directly to hand, my recollection is that it's in the order of 12% to 14%, 15% at present, and it grows quite significantly over the next 5, 10 years. So I hope that answers your question.

Thank you, David. Mr. Chairman, we have, at this time, no further written questions. I therefore suggest that we turn to the audio questions. The first question we have is from [ Jan MacNichol ].

Thank you, Mr. Chair. Last year, 10% of Cooper's shareholders took the extraordinary step of calling on the company to wind up production in a time frame consistent with the Paris Climate goals. Since then, we've seen the intergovernmental panel on climate changes. Fixed assessment report set out just how dire the situation is and the necessity of limiting warming to 1.5 degrees. We've also seen the International Energy Agency confirmed there is no room to develop new gas fields if the world's energy sector is to reach net zero emissions by 2050, giving just a 50% chance of limiting warming to 1.5 degrees. How is the company responding to these developments? Will Cooper commit to not pursuing new projects that are incompatible with the 1.5 warming limit and managing down production in line with that goal?

Ms. MacNichol, well, thank you for your question. We had some questions along a similar line last year. And we -- what we are doing, we believe is absolutely aligned with the responsible and sustainable approach to this question of global warming that you raise. But we have a product for which there is very real demand, we have customers that want to sell it, and we are offsetting our carbon emissions already. And we -- to a net zero position. I think it's up to others to work out how some of these sources of energy, but in particular, we will only talk about gas, can be phased out. In the meantime, all the indications to us are, and therefore, in the interest of our shareholders that there is a demand for our product, and we produce it responsibly and we will continue to produce it. So we don't have any plans to wind down production. We don't think that would be in the interest of our shareholders. And particularly, we feel that we are a very responsible producer and a very responsible participant in supply and gas, which will be a transition fuel towards a renewable future.

Thank you, Mr. Chairman. We have a question from Mr. Burke. I understand that he similarly has a question around transition to renewable energy.

Fellow gas producer, Santos is currently being sued over greenwashing with the credibility of its net zero by 2040 plan one of the key issues in the case. Cooper's own net zero claims have been called out as greenwash in the media as they rely entirely on offsets, and by excluding the emissions generated when Cooper's products are used, account for less than 1% of the company's total carbon footprint. Has the Board assessed the legal risks associated with its net zero claims and have investors or regulators raise concerns on the issue of greenwashing?

Well, we don't think that what we are doing can be described as you have. We have offset our Scope 1 and Scope 2 emissions. And our -- I sense are you saying that we're not addressing our Scope 3 emissions? And therefore, what we are doing is just greenwashing, I'm not sure what your allegation is.

Well, can you hear me?

Yes.

My concern is that the media is painting it as greenwashing. And you're relying -- or we're relying on excluding the emissions generated by the products they used and they're less than 1% of the company's total carbon footprint. Surely, the products that are used, Cooper must be accountable for the carbon emissions from its products when they're used.

Well, can I -- I'm sure you would agree that our customers' Scope 1 and Scope 2 emissions are our Scope 3 emissions. And therefore, if our customers get as we do and offset their Scope 1 and Scope 2 emissions, that would be offsetting our Scope 3 emissions. Now if you want us to offset Scope 3 emissions and then you go and get on to our customers and you want them to offset their Scope 1 and Scope 2 emissions, that's double counting. And I don't -- I mean, the media is a very generic -- the script you are using to put behind this question. But we believe that Scope 3 emissions are a much wider issue that society as a whole will need to address. Our total -- we estimate that our total Scope 3 emissions are around 600,000 tonnes of CO2 equivalent. And we are carbon neutral for our own Scope 1 and Scope 2 emissions. We're happy to work with our customers to try and see what initiatives might be able to be taken or partnerships developed to progress the mitigation of Scope -- their Scope 3 emissions. But you've got to avoid double counting. It's mathematical lunacy to require 2 points in the chain to eliminate the same thing twice.

Thank you, Mr. Chairman. We have a question from Mr. [ Steffanhoff ] regarding investor expectations.

Thank you, Mr. Chairman. According to an ASX notification on 21st of October, Super Fund Hester owns more than 5% of Cooper shares. Hester has been quite vocal in its call for climate action and particularly support for net zero emissions by 2050. Given the International Engery Agency says at meeting the net zero goal requires no new gas fields beyond those already in the development, have Hester or any other institutional investors called on Cooper to stop assuming new development projects and align its production and CapEx plans with the IEA's net zero by 2050 scenario?

Mr. Steffanhoff, thank you for your question. And the answer is no.

Thank you, Mr. Chairman. The last question we have -- last audio question we have is from Mr. [ Zilarovsky ] whose question relates to asset portfolio and then has comments regarding shareholder value growth. I'm sorry. He hung up. Sorry, Chairman. In which case, Mr. Chairman, we have no further written or audio questions at this time.

Thank you. Thank you, Amelia. And I thank everybody for their questions. Thank you for holding on the line for as long as I know some of you did to ask your questions. And this is one of the real downsides of meeting virtually that we can't continue to discuss the things that you would like discussed over a cup of tea at the conclusion of the meeting. And I do -- I really do hope, as I said last year and we said again this year that next year we can meet face-to-face and have better interactions with shareholders. And also, it's easier for you to interact with and discuss particular areas of focus with some of our senior management team, all of whom would be available. But anyway, thank you for your audio questions. Thank you for your written questions. And we'll now proceed to the formal part of the meeting. Can I just remind shareholders that although the window for asking verbal questions is closed, shareholders may continue to submit written questions through the online meeting platform. We now move to the formal part of the Annual General Meeting of Cooper Energy Limited. I've been informed that there is a quorum present. Therefore, the meeting is properly constituted, and I declare the meeting open. The proxies received for today's meeting are held by Computershare. We have received proxies representing approximately 793 million shares or approximately 49% of the company's issued shares. Where a proxy vote has been given to the Chairman without voting instruction, in all cases, I intend to vote in favor of Resolutions 1 to 5 inclusive. The Notice of Meeting dated the 11th of October has been circulated to all Cooper Energy shareholders, and I take that notice as read. The minutes of the general meeting of the company held on the 12th of November 2020 have been signed, and a copy is available for inspection. The Company's Secretary has those minutes. I will now deal with the items of business as set out in the notice of meeting. I confirm again that shareholders wishing to ask a question, provided it relates to the relevant agenda item under discussion,will be given the opportunity to do so via the unblind meeting platform at the time of that resolution. The first order of business is to receive and consider the financial statements and related reports by directors and auditors. I confirm that all shareholders who have requested a printed copy have been mailed a copy of the company's 2021 annual report. The annual report has also been available on the company's website and contains the annual financial report, together with the reports of the directors and the auditor for the financial year ended 30 June 2021. There is no resolution required. However, do shareholders have any questions or comments regarding the financial statements and reports, including any questions as to the conduct of the audit and the preparation and content of the auditor's report, I'll just pause and see if anybody wishes to raise a question.

Mr. Chairman, we have no questions.

There are 5 resolutions to be considered by the meeting today. And as I mentioned earlier, the poll is open on all items. Resolution 1 is the adoption of the remuneration report. Consistent with Section 250R of the Corporations Act 2001, the company submits to shareholders for consideration and adoption by way of a nonbinding vote its remuneration report for the year ended 30 June 2021. The vote on Resolution 1 is advisory and will not bind the directors or the company. However, the company will take the outcome of the vote into consideration when reviewing remuneration practices and policies. I move that the remuneration report as set out in the director's report for the financial year 30 June 2021 be adopted. The proxy votes for this resolution are now displayed on your screen. Please note that as set out in the notice of meeting, key management personnel and their closely related parties are excluded from voting on this resolution. Please see the notice of meeting for more detail on how that voting prohibition is applied. The resolution is open for discussion. Does anybody have any questions they would like to ask?

Mr. Chairman, we have no questions.

There being no questions, we will move to the next item of business. Please vote by the online platform for all resolutions. The virtual meeting guide in the notice of meeting sets out the relevant details, and the final poll results for all resolutions will be released to the ASX and posted on the company's website when they are available later this afternoon. Resolution 2 is the reelection of Mr. Jeffrey Schneider as a Director. Clause 5 of the company's constitution provides that at each annual general meeting of the company, 1/3 or the number nearest to but not exceeding 1/3 of the directors and any director who has held office for 3 years or more must retire from office. A retiring director is eligible for reelection. Mr. Schneider being eligible has offered himself for reelection. Details of Mr. Schneider's background and experience are contained in the annual report, and I now invite Mr. Schneider to say a few words.

Thank you, John, and good morning, fellow shareholders. My name is Jeff Schneider. I've had the privilege of serving you as a Non-Executive Director now for the past 10 years. Today, I seek your support for my reelection as a Non-Executive Director for a term of 3 years. I've worked in the upstream oil and gas industry in Australia for 40 years. I joined Cooper Energy as a Non-Executive Director in 2011 when asked by David Maxwell, our Managing Director, to assist him to take Cooper Energy in what was then a new direction. Much of my industry experience has been gained at Woodside Petroleum, where at different times, I headed Woodside's domestic gas and LNG marketing functions as well as having business responsibility for the financial performance of Woodside's investment in the North West Shelf project. For time at Woodside, I was also responsible for the development of business strategy for mergers and acquisitions and also for human resources. In the past, I've also served as a Non-Executive Director on other Australian Stock Exchange-listed companies in the upstream oil and gas sector, such as Strike Energy and Comet Ridge. While at the present time, Cooper Energy is suffering the financial consequences of low throughput through the Orbost Gas Plant, I believe our strategy is sound. We have excellent people and a very capable executive leadership team led by David Maxwell. The company's values and its culture are also very strong. We are facing a time of great structural change in the energy industry as a whole. The pace of change is, quite frankly, breathtaking. It is gratifying that Cooper Energy has not only foreseen these changes coming, but has also responded decisively and that includes achieving carbon-neutral certification. I expect the company will play a key role in the future energy supply mix in Australia. This is a challenging but exciting time to be a Director of a company in the energy sector. With your support, I look forward to playing a part in Cooper Energy's next phase of development. Thank you. Thank you.

Thank you, Jeff. I have pleasure in moving Mr. Jeffrey Schneider, a Director of the company who retires by rotation in accordance with Clause 5.1 of the Constitution and who offers himself for reelection, be reelected as a Director of the company. The proxy votes received for this resolution are displayed on your screen. The resolution is open to discussion. Does anybody wish to ask a question?

There are no questions, Mr. Chairman.

Thank you. We will move to the next item of business. Please vote via the online platform. Resolution 3 is the reelection of Ms. Elizabeth Donaghey as a Director. As with Resolution 2, retiring directors are eligible for reelection. Ms. Elizabeth Donaghey being eligible, offers herself for reelection. Details of Ms. Donaghey's background and experience are contained in the annual report, and I now invite Ms. Donaghey to say a few words.

It's been a privilege to be on the Cooper Board for the last 3 years, and I hope today you give me the opportunity to continue to serve you. My corporate experience was in the upstream oil and gas industry with Woodside and BHP. My experience included reservoir engineering, gas marketing and asset management, where I worked with and led teams to bring new fields on to production, to manage the production from existing fields and then to manage fields as they reach their end of life. In terms of directorships, my focus is on energy as well as Cooper, I sit on the Board of AEMO, the energy market operator here in Australia, as well as on the Board of Ampol. There are many things I find exciting about Cooper, including our strong strategy, our focus on sustainability and our portfolio of growth options. If you do reelect me to the Board, I look forward to working with and supporting management as we work to deliver value to you. Thank you.

Thank you, Betsy. I have pleasure in moving that Ms. Elizabeth Donaghey, a Director of the company, who retires by rotation in accordance with Clause 5.1 of the Constitution and who offers herself for reelection, be reelected as a Director of the company. The proxy votes for this resolution are now displayed on your screen, and the resolution is open for discussion. Does anybody have a question?

There are no questions, Mr. Chairman.

Thank you. Well, then we'll move to the next item of business. And please vote via the online platform. Resolution 4 is the election of Ms. Giselle Collins as a Director. Ms. Collins was appointed by the Board as a Non-Executive Director of the company effective from the 19th of August 2021. In accordance with clause 8.2 of the constitution, a director appointed by the Board ceases to hold office at the conclusion of the next annual general meeting and is then eligible for election. Ms. Collins seeks election as a Non-Executive Director of the company. Details of Ms. Collins background and experience are contained in the annual report. I now invite Ms. Collins to say a few words.

Thanks, Mr. Chairman, and good morning, shareholders and guests. I'm a chartered accountant with significant experience at both a professional accounting firm as well as in commercial roles across many sectors over the past 30 years. I also have been on a variety of boards and currently sit on 2 listed boards, one in rare earth and the other in property. I've also been appointed to government boards that fulfill my ESG mindset, including the Royal Botanic Gardens and Domain Trust Board, which includes the role on the Advisory Council for the Australian Institute of Botanical Science. The other experience in this category dates from 2013 as a Nominee Director for Indigenous Business Australia on some of its tourism boards co-owned by Indigenous organizations. Being part of the oil and gas industry provides an opportunity to contribute diversity of thought around the table, in particular, in the areas of risk, financial management and sustainability at a time when the company is focused on crystallizing and growing the value within its existing portfolio. I was attracted to joining the Board of Cooper Energy due to the caliber of the Board and management teams. They consistently underpin decision-making by reflecting upon the corporate values that are care, integrity, fairness and respect, transparency, collaboration, awareness and commitment. I believe the progress that they have made on carbon neutrality is a direct result of this and reflect that they began this initiative well ahead of the current momentum. I'm therefore very pleased to offer myself for election at this AGM.

Thank you, Giselle. I now have pleasure in moving that Mr. Giselle Collins be appointed as a Non-Executive Director of the company by the Board in accordance with Clause 8.1 of the constitution since the last annual general meeting and who ceases to hold office at the conclusion of this annual general meeting in accordance with 8.2 of the Constitution, be elected as a Non-Executive Director of the company. Proxy votes for this resolution are displayed on your screen. The resolution is open for discussion. Does anybody have a question?

There are no questions, Mr. Chairman.

Thank you. We will move to the next item of business. And please vote by the online platform. Resolution 5 relates to the issue of rights to the Managing Director. The Board considers that its senior executive should be remunerated in a manner that encourages them to become and remain shareholders as this is the best mechanism to align their interests with those of the company's shareholders. It is the company's policy that the performance-based pay, that is the pay that is at risk, of senior executives forms a significant portion of their total remuneration. Granting incentives under a long-term incentive plan seeks to encourage and reward contributions to the company's long-term sustainable performance. As noted above, Listing Rule 10.14 provides that a company must not issue or agree to issue securities to a director under an employee incentive scheme without the prior approval of holders of ordinary securities. Under this resolution, shareholder approval is sought for the issue of performance rights and share appreciation rights collectively incentives to Mr. Maxwell. Subject to shareholder approval, the incentives will be issued in accordance with an invitation made by the Board pursuant to the terms of the company's equity incentive plan amendments to which were approved by shareholders at the 2019 AGM. I now move that for the purposes of listing rule 10.14 and for all other purposes, the issue to Mr. David Maxwell of performance rights and share appreciation rights pursuant to the company's equity incentive plan as described in the explanatory notes to the notice of meeting be approved. The proxy votes for this resolution are displayed on your screen. And I observe that the company will disregard any votes cast on this resolution by Mr. Maxwell, his nominees and any of their associates and by the company's key management personnel as named in the remuneration report or by any closely related party of a member of the key management personnel acting as a proxy. Please see the notice of meeting for more detail on how this exclusion -- how this voting exclusion is to be applied. The resolution is now open for discussion. Does anybody have any questions?

There are no questions, Mr. Chairman.

Thank you. Please vote via the online platform. In a moment, I will close the online voting system. [Operator Instructions] I will now pause to give you a little bit more time to finalize those votes on all the resolutions placed. Last chance to vote on the resolutions. [Voting]

Well, I think everybody's had sufficient time to cast your votes. Thank you for doing so, and I now formally close the polls. The final poll results will be released to the ASX and posted on the company's website when they are available later this afternoon. And that brings proceedings to a close. On behalf of the Board, I thank you all for participating in today's online AGM, and repeat for the last time that I hope next year, we are gathering face-to-face and we can enjoy better fellowship. We have now completed the matters contained in the notice of annual general meeting. I hope you and your families stay safe and well, and thank you again for your attendance. I declare the meeting closed.