Central Petroleum Limited (CTP) Earnings Call Transcript & Summary

Good morning, and welcome to our September 2021 webinar. Today, we are going to be covering Central's fiscal year '21 annual results as well as provide some updates on our various business activities. I'm joined by our CFO, Damian Galvin; and our General Manager of Exploration, Duncan Lockhart, who's going to talk a little bit today about why and how, In addition to hydrocarbons, Central is very interested in pursuing helium and hydrogen throughout our sub-salt prospects in the Amadeus basin. I'm also joined by our Chair, Mick McCormack, who will say a few words at the end of the presentation, and also be available for a question-and-answer session to conclude the webinar. Moving on to our recent annual highlights. I think that we accomplished most of the things we set out to achieve during the year. We had solid operating and financial results, completed our 3 well pilot program at Range, which is currently on test and progressed a major sub-salt prospect at Zevon, where we'll be shooting seismic in a couple of months. Our biggest highlight, however, is the 50% sale of our operating assets. We've got a very attractive price, which should give everyone some comfort on the underlying value of our assets, and we expect to book an accounting profit of around AUD 35 million, which really demonstrates our strategy since acquiring the asset 6 years ago have been successful. But the main outcome from the sell-down, is that we are able to pay down debt. and can fund our share of over AUD 100 million in new growth activity throughout our operating permits. These include deep exploration wells at Palm Valley and Dingo starting later this year, combined with a presale earlier in there, we have also been able to fund this growth activity, without the need to raise equity, which I think is a great result for all shareholders. Obviously, we faced our share of challenges. Timing on some projects and activity slipped, as COVID continued to impact schedules. Our pilot program at Range requires a bit more time and additional stepped out wells to get the necessary technical information, on which to progress to a final investment decision, and I am disappointed about the ongoing lack of progress at Dukas over the past year. This has largely been outside of our control, but nonetheless, very frustrating, and I'll talk a bit more about that, later in the presentation. I also realize that our share price hasn't reacted to our recent achievements in the way that we would have hoped. At a macro level, I think there is a disconnect between equity prices and market fundamentals, which I'll talk to again at the conclusion of the presentation during the market update. But I want to highlight through this presentation, that the results of our growth strategies are still in front of us. 2020 was a year, where we essentially paused activity and focused on surviving the challenges of COVID, and we successfully did that. This last year, we not only restarted our growth activities, but we funded them and made some great progress forward. And now we're in an implementation phase, and this means that our focus at this moment is on delivery. Be it turning Range into 2P reserves and a final investment decision or growing new reserves through exploration at Palm Valley and Dingo; exploring our sub-salt by drilling at Zevon and Dukas, we're even adding to our growth strategy through more exploration and business development. Our recent asset sale is a good example. It was a great result, but it was not the end game. It is a stepping-stone to fund this current phase of our growth. As you'll see in the presentation, we made good progress this last year, but the real results, the real outcomes from our growth strategies that will create shareholder value are ahead of us. Obviously, I can't predict when the share market will respond. But if we continue to stay focused on implementation and delivery over the next 12 to 18 months, the equity markets will follow. On that note, I'd like to now hand it over to Damian to cover our fiscal year '21 financial results.

Thanks, Leon. Well I think we're reasonably happy with the way the year ended up, given the start of the year, back in mid-2020. There's obviously a lot of uncertainty around where markets were heading. So to be able to book revenues of AUD 60 million for the year and offer sales volume of about 10.3 petajoules equivalent, was a pretty positive result in the end. Those numbers are down, obviously, on last year. Sales volumes were down. We did start with the weaker markets, at the end of the first half of the year, and obviously natural field decline continuing through the year. We've got the new wells coming in at Mereenie this month, which will help to obviously restore a lot of that fuel capacity. At Palm Valley, we saw the Palm Valley 13 well, which performed so well and for so long, finally come off its plateau as well and begin to decline. So a reasonably strong result overall. We did have higher pricing from oil and new gas contracts to help offset some of that volume decline. There is a pretty strong EBITDAX number at 26.1%, was actually up from the underlying EBITDAX of AUD 25 million last year, that's after you take out the gains that we saw from the sale of our exploration tenements last year. And gross net profit overall, statutory net profit of about AUD 250,000, which is just above the line, down from the reported profit last year of AUD 5.4 million. But if you strip out the impact of the -- of that profit on sale of those exploration tenements last year, the underlying loss was about AUD 3 million last year. So just poking our head above the profit line this year, is a pretty strong result. Cash at end of the year at AUD 37.2 million, which is pretty strong. That included the benefit of the presale agreement that we completed during the year. And net debt at AUD 31.3 million is probably the lowest it has been for some time. A little more detail on the numbers, you can see the quarterly sales chart there on the right, have been pretty consistent now at around 2.5 petajoule equivalent for the last 5 quarters. You should see that increase, as the new Mereenie wells come online this month. But obviously our overall interest will decline, as a result of the partial asset sale that we expect to complete on the 1st of October. In terms of revenues, as I mentioned, sales prices were up AUD 5.83 realized price per gigajoule of stronger markets, better oil pricing and some new gas contracts have contributed to that. Operating costs per gigajoule were slightly higher at AUD 2.81, and that's largely a result of us having to spread those costs across at lower volume base. Otherwise, we're reasonably happy with the cost containment measures that we've got in place in the field. Finance costs were a bit lower at AUD 5.6 million, obviously lower debt and lower interest rates contributed to that. The exploration activity was up, particularly with our Range pilot, the 3 wells that we drilled there in April, and the preparations and activity that we've already got underway on those new exploration wells, which we'll be kicking off later this year. And corporate costs of AUD 5 million were down. Again, resulting from our cost reduction initiatives that we have in place. Okay. An update as to where we are with our asset sale in Amadeus basin. So if you recall, we're selling 50% of our interest in the Mereenie part Valley and Dingo field to New Zealand Oil and Gas and Cue Energy Resources for around about AUD 85 million. With that, we expect to book a profit of between AUD 35 million to AUD 40 million. That really demonstrates the value that we've managed to add to those fields in recent years. And it gives us the opportunity now to take some of that value off the table and reinvest it into growth initiatives across those areas. Part of the AUD 85 million is a AUD 40 million free carry. That will see New Zealand Oil and Gas and Cue Energy fund AUD 40 million of Central's share of expenditure in those areas going forward. They'll obviously have to put in their own AUD 40 million, and by the time Macquarie put in their contribution in Mereenie, we expect to see over AUD 100 million worth of investment in those fields over the next couple of years. So that really does underwrite the future of the field, without us having to put in additional cash ourselves. The deal also enables us to strengthen our balance sheet. We'll pay off about AUD 30 million worth of debt, as a result of the transaction and there'll be some other liabilities as well that come off the balance sheet. So good result all around. So what does the AUD 40 million free carry get us? It gets us an immediate boost to production and revenues in Mereenie. The 4 well recompletion that we've just done. We've got the 2 new production wells we just drilled. They'll be online this month. So there is an immediate revenue increase there that we'll benefit from. For the flare gas recovery project, we're going to take gas that's currently being flared at Mereenie, run it back through into the sales line, so that we can earn extra revenues from that production, and at the same time, reduce our emissions in the field there. Importantly though, it will fund 2 new exploration wells that are kicking off this year, one at Palm Valley, one at Dingo, Duncan is going to give us some more information on that later, and anything that's left over in our AUD 40 million after that work, we can put towards future projects, including new production wells.

Thanks Damian. We're now going to hand things over to our General Manager, Exploration, Duncan Lockhart, to talk about our upcoming exploration program and our subsalt exploration strategy. Over to you, Duncan.

Good morning. Today, I'm going to take you through the exploration component of this webinar, and provide a recap and an update on our exploration activities in the Amadeus Basin, and I'll also touch upon some of the work which we've been undertaking in the pursuit of exploration for helium and hydrogen in the basin. Currently, we're in the final stages of signing the rig contract for the Easternwell Rig 106, which is currently drilling for Santos in the [indiscernible] Basin. As a result, we are on track for our first exploration multispud, Palm Valley Deep, sometime in mid-November, and we expect it will take about 3 months to drill this well, and then after that, we'll be moving on to Dingo 5. And Dingo 5 is a well which has several exploration objectives, 2 deep previously unexplored targets within the Dingo field, the Pioneer sandstone and the Areyonga formation. And in addition, we will also run a completion in the productive Arumbera formation. We've also identified Orange 3 as a highly attractive exploration target and Mamlambo, which is a significant oil target for future drilling. All the approvals are in place for these wells, and we are working on getting them brought forward for drilling. In addition, we're making progress in the joint venture in EP 112, in having Dukas redrilled. It's been a slow process, but we're making forward progress, and we'll update the market when we have a firm outcome. So whilst we've been waiting for action at Dukas, we've spent a lot of time and effort working up the Zevon lead in EP 115, where we have 100% ownership. Zevon has a multi-TCF potential for hydrocarbons, and we've also now realized it has a high potential for the presence of a helium. We're well advanced in the planning stages for a short 30 kilometer seismic test line, on which we'll be running a number of high-spec acquisition and processing parameters, in an effort to image the salt section, which is notorious for creating seismic noise, which impacts our prebuild interpretations. This work is partially funded by a grant, which we were awarded by the Northern Territory government. So whilst planning this acquisition is well advanced, we have also commenced planning for the largest 700-kilometer 2D seismic survey over Zevon and the adjacent areas. So this work will not only fulfil our work program and commitment in this EP, but will also fast track this spud out for the Zevon well, which we're hoping that we can get drilled sometime in late 2022 or early 2023, and if possible, hopefully around the same time, as we come back and finish off Dukas. The diagram on the left is an outline of the well design that we have for Palm Valley Deep, and it shows how we'll be drilling the deeper Arumbera target and deviating the well to 45 degrees, in an effort to maximize intercepting as many open fractures as we can at this depth. If we're unsuccessful in this deep target, we will pull back and do a lateral production well within the Pacoota formation. The well location for Palm Valley Deep has been chosen, due to its crestal location for the deeper target, and in addition, it has the work that we've done and shown that there's high potential for a very open fracture network to have developed in the Pacoota level at this location as well, which makes it an excellent location for us to achieve a number of objectives. Similarly, Dingo 5 will test the Pioneer and Areyonga formations, and the well will be deviated to 60 degrees, once again, in an effort to [indiscernible] as many open fractures as possible. The well will then be plugged back and completed as a [rubber] producer. Long lead items have already been ordered for these wells, and many of these long-lead items have already started to arrive and are being installed in our [Beck's] facility of Alice Springs. So we're well underway here. Both exploration wells, by the way, are fully carried by our partners, NZOG and Cue. To many investors in Central, the opportunity to explore for helium and hydrogen is not a new concept. Central's farm out to Santos in 2012, was designed to focus on chasing large sub-salt targets in the southern part of the Amadeus Basin. The potential for Helium being present in association with the hydrocarbons, had by this time being very well established by the presence of both helium and hydrocarbons at Magee 1, which was drilled in 1992. So look, Dukas, as we know, was suspended short of the primary target, due to major drilling difficulties. We're pursuing our rights within the framework of the joint operating agreement to return to the site as soon as possible. But what we also know is that, both helium and hydrogen, in association with hydrocarbons and nitrogen were recorded in mud gases at Dukas, while we were drilling it. So that's good news and indications that we have A, an active working petroleum system, plus we also have presence of helium potential. As mentioned previously, we are also vigorously working the Zevon lead in EP115, where we dictate the pace of exploration. A recent in-house work has identified excellent potential for helium to be present in the Zevon area. Helium and hydrogen are extremely high-value products, especially helium. They can be commercially viable in their own right, or they can add a very significant upside component to any hydrocarbon discovery. And it has got to be noted that most commercial helium wells in the world have less than 1% helium by volume in the natural gas stream. You may have heard a lot of talk recently about hydrogen, as being the gas that will be an environmental savior. Given that it has high energy values, and when its burnt, releases only water vapor. There's no carbon-based gases or anything nasty that's produced. So it's regarded as a very, very clean fuel. Currently however, the market for hydrogen is in its infancy in Australia. There's still a lot of infrastructure that will be required to handle this gas, because of its unique properties and it still has a long way to go, before it will be a mainstream fuel. However, it's worth preparing for the future. In addition, the process of making hydrogen has various degrees of environmentally friendly credentials. As such, hydrogen production has been co-located. Black, being just as bad as the coal it's extracted from and ranging to gold, where natural hydrogen, is extracted directly from the ground as a gas. There is evidence that naturally occurring hydrogen occurs in the Amadeus space, generally in association with helium, and this is regarded as gold hydrogen. Gold hydrogen is a product of natural radiolysis of pool water, whereby radioactivity breaks the bonds of hydrogen and oxygen to produce free hydrogen. So, what makes helium such a valuable commodity, given that it's the second most abundant element in the universe? Well, it's used a cooling agent for MRIs and in particular, superconducting magnets for space exploration, and as well as party balloons obviously, and the odd Donald Duck impersonation by an uncle at a birthday party. However, it's extremely rare to find Helium on earth, and the demand is increasing, as technology advances in many, many fields into the future. Such is its importance, that in the United States, there is a National Reserve of Helium, and prices are currently in the vicinity of USD 210 per 1,000 cubic feet. So bear this in mind, if you wanted to convert a normal 1,000 cubic feet of natural gas in Australia to a gigajoule, that would be the conversion. So 1,000 standard cubic feet is approximately, like say a gigajoule. And bear in mind that the current East Coast gas price for a gigajoule is somewhere around AUD 9. So compare that to USD 210 for the same volume of gas. So most helium is associated with hydrocarbon gases. It's not generally found just by its own. And in most cases around the world, it is extracted as part of an LNG process. For example, in Australia, most, if not all of our helium production is associated with the Bayu-Undan field, where the helium is effectively a tail gas from the hole of the LNG process. So why are we interested in the Amadeus for helium? Well, the table that we've got here provides critical elements that are required to find helium within a basin. And as helium is created by radioactive decay of uranium to thorium, the presence of a radioactive source rock is critical, obviously. And given that helium is the second smallest element in the universe, only truly impermeable rocks, such as halide and anhydride are capable of providing the required seal to track this gas. So we're fortunate and blessed in the Amadeus space and that we actually have shallow fractured radiogenic granitic rocks within the basin. And in many places, these rocks are immediately overlaid by the thick evaporite sequence in the Gillen formation. So here is the evidence that these conditions exist in the basin. Mount Kitty recovered natural gas on the test from the basement, which contain 9% helium and 11.5% hydrogen. The basement here was naturally fractured granite diorite rocks. Magee also recovered 6.3% helium and 0.03% hydrogen on test, and although 0.03 hydrogen doesn't sound like much, it's significant in the fact that it is actually there. So by world standards, these 2 discoveries have astonishing results with respect to helium because anything worldwide over -- with helium over 1% and the natural gas stream is regarded as a high helium content well. And as you can see, we have 9% and 6%. So these are truly astonishing results for any well in the world. With the necessary criteria that we have derived for potential helium accumulations, we have constructed a plan map to help us guide for us in the best areas within the basin to pursue our exploration. So we've used depth maps of the basement. We've used basin-wide magnetics to help us identify granitic areas in the basement. We've got maps based on wells and seismic, to help determine the extent of the Gillen salt and the thickness. And then we've removed areas from basin, which we believe are too deep for economic drilling. So 4,500 meters or thereabouts. And then we've superimposed on top of this, our mapped closures of the basement and the Heavitree, because it's still a gas and it's in association with hydrocarbon gases, you still need to have a viable closure and a viable track, and we've stacked all these maps together and come up with a map. So this is the result. The green shaded area on this map represents the best parts of the basin for the helium plain to be developed. The grey shaded areas that you can see, represent where we believe that there is a presence of a granitic basement. And the proof of this is that you can see, as expected, Mount Kitty, Magee and Dukas in the green area within the southern part of the basin. But excitingly for us, in addition to this southern area, the area in EP115 around Zevon is also green, and it indicates that we have very good potential for any gas discovery at the Zevon location, to have a significant helium content. And as mentioned previously, due to this permit being in Central's full control, we are fast tracking the acquisition of a 700 kilometer 2D seismic survey, to identify a well location for Zevon, so that we can bring this drilling forward as soon as possible. Thank you.

Great. Thanks, Duncan. Moving on to our update on Range, which is our coal seam gas project in the Surat Basin. We currently have 3 pilot wells on interference testing, which is where we shut in wells on a rotational basis, to see how they interact or affect each other. As we've previously announced, the pilot wells have had lower-than-anticipated initial water rates, which appears to be inconsistent with the technical data we obtained from our 4 exploration wells, which, for example, all showed approximately 25% better net coal thickness. That suggests we will see higher water rates across the permit, as we continue drilling. On the plus side, we saw early gas breakthrough, demonstrating good gas saturation, which is one of the key things we are looking for. We also got vast communication in between the wells, which we deliberately spaced very close at 200 meters rather than a more traditional 750-meter spacing -- This is a positive sign for permeability, but the close spacing also means we are effectively testing a small area with the 3 wells. And as anyone developing CSG knows, coal properties often vary significantly throughout a CSG field and even between neighboring wells. So the low pilot water production results appear to reflect this sort of variation and don't cause us too much concern for the project as a whole. These early results do 2 things, however. First, it extends the time we need to get visibility on water and gas production profiles. Second, it widens the range of technical data on the coals we can anticipate across the permit. Both of these impact what surface facilities we build and ultimately how we move forward to a final investment decision. In order to accelerate the information gathering, the joint venture is now preparing to drill 2 step-out single-well pilots, each about 2 kilometers from the existing pilot location. One of these wells is adjacent to our exploration well range #3, which will allow us to tie the new pilot wells performance to the other 3 exploration wells, where the data looks relatively consistent. We expect to have these step out pilot wells online by the end of the year. This will delay our project schedule by a few months, but we are progressing permits and approvals and discussions with infrastructure providers in parallel, to minimize this delay. The joint venture is now targeting a final investment decision around March 2023, with the commencement of first gas anticipated to occur 2 years after the final investment decision date. The project remains a key priority for Central and our partners, and I can assure you, we are driving it as fast as we can. I would highlight, however, that we are trying to take a permit that had no reserves and no exploration through to a final investment decision for a major project, which simply takes time, particularly where we are trying to get it right and it's very material for the company. This next slide illustrates one of the reasons we continue to have so much confidence in the Range project. We've shown a version of this map before, which shows CSG wells located across the Walloons fairway, along with the depth contour for Range. This slide however adds the publicly disclosed development plan from our neighbor Arrow, who has been working this acreage for more than a decade. What you can see, is that they have started their project in the Southeast and are planning to develop their acreage in a Northwest direction over the next 5 years. You can see how Range project is clearly in this development fairway, based on the depth contours. And we believe the -- our cost structure will also be much lower than ours, which gives us a lot of confidence in converting the range resource into reserves, and ultimately into production. Okay. Moving on to other business activity updates. Let's start with gas markets, which continue to remain strong for term contracts, largely reflecting the recovery in oil and LNG prices globally. Our firm production is currently contracted, but with the drilling campaign at Mereenie winding up, we will be marketing additional firm gas supply from 2022 and beyond. My expectation is that when we do contract, we should be able to match, if not improve on our portfolio prices at that time. Moving on to the Stairway appraisal. First, a bit of background for those new to the story. The Stairway formation sits above the usual production zone at Mereenie, we call the Pacoota, and this is a potential source of additional gas resources in some sections of the Mereenie field. Our Mereenie drilling program saw good gas flows in the upper Stairway in the most recent new production well, West Mereenie 28. This is exciting, because the Stairway currently has 108 petajoules of 2C contingent resource on a gross JV basis, which we believe we can target through horizontal drilling. Our first Stairway appraisal well drilled in 2018 was not successful. However, I think we have a much better play amount for the stairway at this point and with the gas flows from West Marine 28, we are keen to get back to Stairway appraisal in the near term. This will require joint venture approval. However, the stairway gas would have compelling brownfield economics and a success case. So I think it will happen. As Duncan presented earlier, we are very keen to drive basin-wide sub-salt exploration. With regard to Dukas, I don't have much new information to share with everyone at this time. Having said that, things are moving under the surface, and we are pressing our rights under the joint venture agreement to meet the minimum permit commitment of completing an exploration well at Dukas by the end of next year. We've been very clear to Santos, that our expectation is that the JV needs to meet this commitment and we have reached a point where we need a firm drilling plan to achieve this. There are several important joint venture meetings on this matter scheduled for later this month, and in October. I know Dukas has been a long journey for all of us, but I'm hoping to have something concrete to announce on Dukas drilling around the time of our AGM in November. Duncan already talked about Zevon and we are on track to shoot seismic in a couple of months, which is very exciting. The plan with Zevon is to shoot initial seismic this year, followed quickly by a larger seismic program early next year. Once we have clarity on a drillable location, we think a farm-out is possible as a pathway to accelerate drilling a well by the end of 2022 or early 2023. Some positive aspects of Zevon, obviously, are that we have 100% control over that permit at this time, and it appears to be a much shallower target. That means we can source a smaller rig much more quickly than the rig that would be required for Dukas. The Amadeus to Moomba Gas Pipeline is still a serious goal for the company. As we have said before, we tried to get other gas producers to commit existing reserves in order to make that project happen this year, but haven't had any success. We are now looking toward success in our exploration program at Palm Valley and Dingo, which is commencing in a couple of months and targeting almost 200 petajoules of gas, which means it could very well be the catalyst for the Amadeus to Moomba Gas Pipeline. As for completion of our asset sale, everything remains on track. All CPs have been satisfied, which means the transaction is unconditional and formal completion is scheduled for the 1st of October, and we do welcome New Zealand oil and gas and Cue Energy, as joint venture partners and looking forward to having them onboard. As noted earlier, this is a great transaction for Central. It funds our share of over AUD 100 million in gross joint venture investment over the next 12 to 18 months. I also want to mention that we remain very active in business development. We are seeing opportunities surface in this market. Obviously, there's been a lot of M&A activity, but also farm-outs and farm-ins and everything in between. We have a full plate delivering our existing growth strategies. But if a compelling value-accretive opportunity becomes available, we will have a close look as we have successfully done so in the past. Finally, it's worth touching on the significant development in ESG, notably climate change in the global push to reduce the demand for hydrocarbons. At this point, we don't see a material impact on the inputs to our business. Customers are still contracting term gas supplies, insurance is still available and we continue to see our peer group raise capital for growth, both with debt and equity. Having said that, the implications of climate change are clearly an emerging challenge for Central and our sector more generally, which we take seriously, and we need to proactively manage. Our focus on producing gas as a low-carbon transition fuel, combined with very low CO2 production throughout our fields and the relatively small environmental footprint of our conventional gas, gives Central some distinct advantages in navigating the road ahead. Ultimately, our sector will evolve and respond, and I think Central is in a great position to implement and deliver our future growth strategies in that climate, particularly our efforts to find nonhydrocarbon gases like helium and hydrogen as well as opportunities, for example, to realize depleted parts of Palm Valley or Mereenie for example, which could be great candidates for carbon capture and storage, which is something we're having to look at. In wrapping up, I wanted to recognize the weakness in our current share price, which isn't anywhere near what we'd expect, given what we've achieved in the past year. I think there is sector-wide pressure on equity prices generally. As Angela Macdonald-Smith recently wrote just last week in the AFR, 'market sources point to a disconnect between share prices and oil and gas commodity prices, that has been evident for months, but is now becoming ridiculous given the buoyant LNG market and continuing robust crude oil price.' I tend to agree with this, and I think there's some relevance in its impact on our share price. To put it in perspective, the ASX, All Ords Index fell 33% from its high in January 2020 to its COVID bottom in March 2020. Since then, it has not only recovered, but is up 7% from its January 2020 level. The ASX Energy Index though, has really lagged quite significantly. It fell 55% between January and March 2020, as a result of COVID, but has fallen well short of recovery and currently sits about 36% of its January 2020 high. So there's clearly an element of market sentiment that I believe we need to work through as a sector, given what appears to be good market fundamentals for oil, global LNG and domestic gas in Australia. I also think there is an element of timing that is having an impact on our share price. We moved from a very defensive stance in 2020 to restarting growth and importantly, funding this growth through the presale gas agreement and our asset sale, which is close to completion. We are now smack in the middle of an implementation phase, which means the results and subsequent value from our efforts are still ahead of us. Within the next 12 to 24 months, our clear goals are to increase reserves and production at our producing assets, convert range into 2P reserves, and get new exploration drilling done, particularly in our large sub-salt targets at Zevon and Dukas. And obviously, the potential for other business development surprises along the way. These are major growth activities for the company that we intend to deliver, and if successful, I'm confident the share market will respond accordingly. I'd like to now hand it over to Mick McCormack, to say a few words before we open the webinar to questions and answers.

[Audio Gap] annual results call, so I said to him that, it is unusual for Chairs to get involved in results presentations. However, I thought it might be of some value for those interested in Central's prospects to you first hand, my perspective on progress over the last year. Firstly, as Leon has detailed, our financial performance was solid, and we achieved most of the things we wanted to achieve during the year. And what we didn't achieve during the year, was due to a combination of COVID related delays, dealing with joint venture partners and some disappointing, although not entirely unexpected technical results. However, whilst progress may not have been as entirely as hopeful over the years, I can assure you that nevertheless, definitive progress is being made on executing our strategy. From my becoming Chair, we have embarked on a 3 year program to do fur things. #1, complete the sell-down transaction on a demonstrably attractive basis, which, as I speak today, is now almost closed. #2, increased reserves and production at our producing assets. #3, get the range project beyond FID and well on the way to production. And #4, one way or another, get on with exploration drilling at both Zevon and Dukas. It is my belief that to the extent we can achieve these goals, then that will be the same extent we'll see value being recognized in our share price. Whilst the Board and management are disappointed about where the current share price is versus where it might or perhaps should be, as I keep telling Leon, when I was in his shoes, the advice from all the chairs I worked for over the years was always the same; execute a robust strategy well, and the share price will follow. And that is the advice I continue to give Leon and his team. We have a solid strategy. Now let's get it executed well and the value created will ultimately be recognized. And of course, as we are in the exploration business, a dash of good luck from time-to-time also helps. That's all I wanted to say about the company's performance over the year. And on another matter, you'll see references made in the annual report to a rejig of the remuneration arrangements for management from 1 July this year. I thought I'd take this opportunity to provide a little bit of background to this initiative. Given what I've just outlined about the activities that will drive value creation for Central, it became obvious to the Board that what happens over the next 3 years will be fundamental to the long-term prospects of the company. So after a thorough analysis, together with some expert advice, the Board has implemented what we're calling a transformation incentive plan, which is all about ensuring that any incentives earned by management, are in direct proportion to the level of achievement of executing various elements of our strategy over the next 3 years. As I've indicated, the Board believes that the activity being pursued over the next 3 years will be transformational for the company, and therefore, it should be the singular focus for the management team to achieve, which is why we've introduced the transformation incentive plan. This plan will be set out in detail in next year's annual report. So with that, I'll pass back to Leon. Thank you.

Great. Thanks Mick. I think we're going to hand things over to the question-and-answers section. I think if you haven't seen it in the right-hand corner, there's an opportunity to type in your questions. And just looking at what we've got so far, I think there is nothing unexpected in terms of the themes and questions. But I would highlight or note that you've got a great opportunity with Mick McCormack here to ask any questions related to the Board or the strategic aspects from his perspective, so I'd encourage you to do that. Let's start running through the questions, Damian.

First question about Dukas. Question says, Santos has been dragging their feet on Dukas for years. What are our options? Should they continue to drag this out? When is the drop dead date to decide what they're going to do? And are we at risk of losing this lease if we fail to drill?

Yes. That's a good question. Over the past couple of years, we have been pushing Santos very hard at a joint venture level to accelerate drilling at Dukas and in particular, a redrill at Dukas or a twin at Duke is to complete that drilling program. Under the joint venture arrangement, we have very little control to force that acceleration. And as you're aware, we've had a little success in causing that to happen. Where we're at today, I think, is now moving into a different phase where we actually do have some opportunity to force activity. The key to that is we have a permanent commitment where an exploration well needs to be drilled by the end of 2022. That certainly is something that we are holding tight too and pushing Santos to meet that obligation. I don't see it as a risk in the sense that if we are working constructively towards the drilling of that Duke as well, we would expect -- and as we've done in the past to be able to get some extensions to that permanent commitment. Our position at this point is any extension will be only to the extent required due to a reasonable and prudent drilling program. We are not looking to allow further extensions just for the sake of scheduling a well within the Dukas drilling program across our portfolio. So at this point, and I've highlighted that during the presentation, we are now working through our joint venture rights, and we do have some at this point, and it's just now getting to the point where we have those and we are going to press hard to ensure we meet the minimum permit commitments and get this well drilled. So I think this next phase, we will be in a much better position to get concrete movement from Santos at that permit.

Thanks, Leon. Another question here. This one is on the Flare Gas Recovery Project, asking what sort of volumes are currently being flared and rediverted in that recovery project and how much would we recover through the new process that we're planning and what sort of revenue impact is it like to have?

So the flare at Mereenie has historically down about 1 TJ a day and that's largely due to gas composition issues on the UV Index, in particular, to be able to supply into the Northern Territory gas market. The program we're working on now would essentially take two-thirds of that flare volume and redirect it and put it into sales gas that do meet the Northern Territory gas specifications and that leaves about a third of that 1 terajoule a day still remaining to be flared. Now having said that, we are also working hard on several fronts to find a useful home for that residual flared amount and there's opportunities such as remote generation, potentially some form of LPG usage. And so that's something that we think will occur. It obviously makes sense to find a commercial solution that avoids any flaring out of the Mereenie field and channel it towards something that is both useful for gas customers, but also provides an actual revenue stream for the company.

Okay. Got another question, it is around helium, asking, do we have a P50 recoverable estimate for helium in EP112, you get based on the Magee well.

I can answer that. Yes is the short answer. We have calculated internally volume metrics, which cover all the prospects and leads in the area and we have calculated the helium volumes based on a range of values which we have encountered in the basin and it's a fairly wide range, given the fact that we only have really 2 wells that have provided us with helium. However, under the ASX rules, I can't specifically tell you what those numbers are in this format, but I can tell you that the numbers are multiples of BCFs, which makes these -- all of these leads potentially for helium very attractive.

Thanks, Duncan. Question here about the Amadeus to Moomba Gas Pipeline. Is the lack of other producers' interest imply that CTP's exploration success or upside is the sole underwriter foundation volumes for this proposed pipeline.

Yes. I don't think it's that binary. I think we did make a quick push to try and quarantine and commit third-party reserves to the pipeline, which would have helped allow for a final investment decision on that project this last year. We haven't been able to accomplish this at this point in time. But certainly, as we progress, we think there's great opportunity to get third parties involved and bring those reserves, E&S foundation contracts. And obviously, there's a lot of reserves offshore. Darwin that do come onshore and we are seeing a lot of exploration happening at McArthur and Beetaloo. Now having said that, the timing, we were really shooting for a very quick sharp commitment to those reserves to be able to get the pipeline across FID this last year. That's not happening at this point. And while we still continue to get third-party reserves into the foundation contract mix, our focus right now is getting success in our exploration program. And obviously, Palm Valley Deep and Dingo Deep would be great catalysts for getting that pipeline built. And obviously, we've got other targets, whether it be Orange, for example and Stairway that can also contribute. Those are -- haven't achieved -- we haven't reached fit on those projects yet, but we are hoping to get those in the near term. And again, that would contribute materially to the Amadeus to Moomba Gas Pipeline. So it is a very serious piece of infrastructure for us. We are working all the angles to make it happen. And if you do look at the map, you can see how clearly it's a much more efficient opportunity for us to supply gas into the southern portions of the East Coast gas market, where we do see some very high pricing excursions, and this would be a great alternative supply for those customers down south.

So the question here just around the gas markets generally. I guess we recently saw Senex gas deal with New Century. Could you provide a general view on the competitive nature of the Amadeus gas remarketing into the East Coast. And any general comments on supplying East Coast [indiscernible]?

Well, it's Mick here, given that [indiscernible] came to me. So thanks for the question. I'll turn up for at least to answer one question. And this is the stuff I am talking about. It's interesting, yes, the Senex deal up to Century captured some media attention. But as I've said in response to a few other people asking about it, it's not unique, back in the APA, we haul gas all the way from the NT to get sooner here in Brisbane, so certainly doable. Just remind you of the vagaries of the market. And the competitive nature of Amadeus gas entering into the East Coast that's an interesting one. The more I read about supply constraints or price of gas increasing in the Southeast markets, the more enthused I am about Amadeus Gas coming into the East Coast because perversely, the higher the LNG price, that gives us here at Central a bigger target to [IMAT], to getting our gas into the Southeast markets. So yes, right now, it's the competitive nature of the market is positive for Central.

Okay. Thanks, Mick. Nothing to add. I haven't got any other questions. So I guess we're almost at a point to wrap it up.

Great. Well, thank you, everyone, for attending. And as I said at the conclusion of the presentation, we've got an incredibly exciting 12 to 18 months ahead. We are focused squarely on implementation. I'm confident if we do implement what we're set out to do and focus on delivering the growth strategies we've laid out today in past communications, the share price will follow. And we appreciate shareholder support through this phase and look forward to updating the market with good news over the next year.

Thank you.