Central Petroleum Limited (CTP) Earnings Call Transcript & Summary

Good morning, ladies and gentlemen, and welcome to the 2021 Annual General Meeting of Central Petroleum Limited. I'm Mick McCormack, and I am the Chair of Central Petroleum Limited. I will be chairing this meeting today in accordance with the company's constitution. In accordance with the Corporations Act, today's AGM is being held in person here at the Christie Center in Brisbane and as a virtual online meeting. First up, we would like to acknowledge the traditional owners of the land on which we meet today and pay our respects to elders past, present and emerging. [Audio Gap] General meeting properly constituted and open. As this meeting is being held both in person and virtually, there are a number of process matters which I would like to bring to your attention. Firstly, for those attendees who are online, your questions can be submitted at any time. [Operator Instructions] Please note that while you can submit questions from now on, I will not address them until the relevant time in the meeting. At the relevant time, Central's Chief Financial Officer, Damian Galvin; will be reading out the questions submitted online. Please also note that your questions may be moderated, or if we received multiple questions on the one topic, amalgamated together. For those shareholders online who wish to ask a verbal question, an audio questions line will be available once the meeting begins. When you are ready to join the audio questions queue, please pause the broadcast on the Lumi platform, select the home tab, and then click on the link under Asking Audio Questions. A new tab in your browser will open where you will be prompted to enter your name and the topic of your question before being connected. You will then be able to continue listening to the meeting on this page while waiting to ask your question. When it is time for your question, Damian Galvin will read out your name and ask you to go ahead. At this time, you will be unmuted. Once you have finished your question, you will be muted automatically. You can then remain on the line to hear the rest of the meeting or ask additional questions. Alternatively, you can hang up, return to the Lumi platform tab in your browser and resume the broadcast. If you have any issues using this system, please return to the Lumi platform. For those here in attendance at the Christie Center, you will be afforded the opportunity to ask questions. I'll ask that at the appropriate time, you direct your questions to me. Accordingly, after each item is read out, I will invite comments from the floor. However, please note, I will be limiting questions to the item of business being considered. I would ask that you state your name for the record and when you address -- sorry, for the record when you address the meeting. On conclusion of the meaning formality, shareholders will be also given the opportunity to ask additional questions of the Board and the company's senior executives. Finally, due to time constraints, we may run out of time to answer all of your questions. If that happens, we will answer them in due course via e-mail and post in responses on our website. Voting today will be conducted by a way of a poll on all items of business. Online voting, in order to provide online attendees with enough time to vote, I will shortly open voting for all resolutions. At that time, if you are eligible to vote at this meeting, a new voting tab will appear. Selecting this tab will bring up a list of resolutions and presents 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 do however have the ability to change your vote online up until the time I declare voting closed. In-person voting, for shareholders in attendance here at the Christie Center, when you registered at the attendance desk this morning, you should have received a card from Computershare representatives. Members, proxyholders obtaining a blue card can vote and speak at the meeting. Members holding a red card are not eligible to vote, but can speak at the meeting. And visitors holding a yellow card are not eligible to vote or speak at the meeting. If there is anyone present who is eligible to vote but has not received a blue card, please see a representative of Computershare now. On the reverse of your blue admission card is your voting paper and instructions. I will now go through the procedures for filling in the voting papers for those shareholders here at the Christie Center. Proxy holders have attached to their admission card a summary of proxy votes, which details the voting instructions for business items on the appointment documents in your favor. By completing the voting paper, when instructed to vote in a particular manner, you are deemed to have voted in accordance with those instructions. In respect of any open votes, a proxy holder may be entitled to cast, you need to mark a box beside the motion to indicate how you wish to cast your open votes. Proxy holders should refer to the summary of proxy votes form attached to your voting paper for further information. Shareholders also need to mark a box beside the motion to indicate how you wish to cast your votes. Please ensure you print your name where indicated and sign the voting paper. When you have finished filling in your voting paper, please lodge it in a ballot box to ensure your -- the votes are counted. In respect of voting at today's meeting, on a poll, each member online or present in person or their proxy, attorney or corporate representative, has one vote for each share held. Only one vote is allowed per joint holding. If more than one joint holder tenders a vote, the vote of the member named first in the register must be accepted to the exclusion of all others. If a proxy has been directed to vote in a particular manner, if the proxy is entitled to vote, he or she must vote in accordance with the direction. And for some items of business, certain votes will be disregarded, as explained in the voting exclusion statements in the Notice of Meeting. The persons entitled to vote on the poll are all shareholders, representatives and attorneys of shareholders and proxy holders who hold blue admission cards or who duly attend online. The order of business that I will -- is that I will read out each item of business in turn, take questions on that item of business. And for those of you in-person, I will then defer voting until the end of the meeting. At which time, I'll explain the voting procedure for the poll to be conducted for resolutions 2 through to 4E, using a blue voting card. Importantly, should you require assistance with the technology, please call Computershare Investor Services on 613-9415-4024, Melbourne number, obviously, as currently shown on your screen. If you require any assistance here at the Christie Senate, please raise your hand. I now declare voting open on all items of business. For those online, the polling icon will soon appear. Please submit your votes at any time. I will give reminders to vote after every resolution, and I will give you a warning before I move to close the voting. Today, our Board members are participating from various locations around Australia. Firstly, let me introduce you to our Board members. Leon Devaney, our Managing Director, is here with us in Brisbane. Stuart Baker, Non-Executive Director via a video link; Stephen Gardiner, Non-Executive Director via video link; Kathy Hirschfeld, Non-Executive Director and with us here in Brisbane; and Agu Kantsler, Non-Executive Director via video link. In addition to our Board, I would like to introduce to you a member of our Risk and Sustainability Committee, Mr. Bob Liddle. Bob was first engaged by Central Petroleum as a consultant over 15 years ago. Born in Hatches Creek and a member of the Arrernte tribe of Alice Springs, he has played a key role as an adviser in the negotiations for oil and gas sales in the Northern Territory and maintaining our local relationships for Central. Bob's an aboriginal elder, who was respected by the traditional owners in the areas where we operate in the NT. Also present is Company Secretary, Daniel White. In addition to the Board, also in attendance from Central executive team here in the Christie Center: Chief Financial Officer, Damian Galvin, Chief Operating Officer, Ross Evans; General Manager, Exploration, Duncan Lockhart, and Chief Commercial Officer, Jonathan Snape. I would also like to introduce you to Mr. Marcus Goddard, our auditor from PricewaterhouseCoopers; and Mr. Lewis Brimelow at the rear there, Relationship Manager of Computershare, the company's share registry. Now we have finished with the introductions. Finally, I will present my Chair's address. Good morning again, shareholders and guests. It is a pleasure to address you today for my first Annual General Meeting as Chair of Central Petroleum. When we last met at last year's AGM, we were regaining momentum following the market disruptions of 2020. And we're working to set the foundation for the implementation of a series of important growth initiatives. I'm pleased to report that we have made good progress on these 4 initiatives in the last year. Firstly, in the Northern Territory, we have recompleted 4 wells and drilled 2 new production wells, which is expected to boost production capacity at Mereenie by about 1/3 and underwrite new term gas sales contracts. Secondly, our 2-well exploration program in the Northern Territory is ready to start drilling next month. If successful, we could significantly increase our gas reserves from these targets and this will provide the driver for increased gas sales into the East Coast gas market. Thirdly, the partial sell-down of our interest in the Amadeus Basin producing assets to New Zealand Oil and Gas or NZOG as we call them and Cue Energy Resources or Cue was a significant milestone, crystallizing the value that has been created in those fields in recent years and supporting our increased focus on new growth initiatives. And fourthly, our 3-range -- our 3-well Range Coal Seam Gas pilot in Queensland has been drilled, and testing is underway. We are committed to reaching a final investment decision for this project. And we'll commence drilling 2 additional step-out wells by the end of the year to accelerate the process. At a macro level, energy markets have continued to strengthen from the lows in early '20. And with the federal government promoting the importance of natural gas through its energy plan announced last year, gas is set to continue playing an important role in Australia's transition toward reliable low carbon energy. Central is well placed to participate in this transition and supply gas into an increasingly undersupplied market. This will require a significant investment in new projects. And the introduction of NZOG and Cue will result in over $100 million of investment in our producing fields in the next 2 years, allowing us to divert more resources to our other potentially higher-yielding growth-oriented opportunities in the Amadeus, Surat and beyond. Amadeus Basin remains significantly under-explored and we will now focus on unlocking some of these resources from our extensive holdings in the area. The value of our portfolio however is not limited to hydrocarbons. Relatively high concentrations of a valuable and much sought after helium have been measured at some of our exploration wells in the Amadeus Basin, as have traces of naturally occurring hydrogen -- carbon-free energy source. These other non-hydrocarbon gases potentially have significant value, and our future exploration programs will seek to confirm their prevalence in the Amadeus Basin. Across our operations, our environmental footprint remains relatively small. Our gas contains low concentrations of carbon dioxide that does not need to be extracted or released to the atmosphere. We use proven and safe conventional drilling techniques to extract our gas and our planned development and exploration programs did not require fracking. We continue to value the long-term relationships with our local stakeholders, traditional owners and land owners in the areas in which we operate. We provide employment and business opportunities in these local communities while protecting the environment in which they live. I thank them for their continued support. At a Board level, we've taken the opportunity to complement the existing suite of skills, welcoming Stephen Gardiner as a director. Stephen brings extensive finance experience to the Board at a critical juncture in our growth strategy. We also farewelled director, Julian Fowles, a long-standing director and former Chair, Wrix Gasteen. We thank them for their service during Central's transformation. I'll also take this opportunity to thank our CEO, Leon Devaney, and his team for their efforts in ensuring our supply to customers was not disrupted by the pandemic, for continuing our excellent safety record, with the ongoing work on the new wells and exploration activities and for their efforts in completing the asset sale. Well done in a tough year. I'll conclude my address by saying our strategy is very clear to unlock the resources in our portfolio and bring them to market. The foundations have been set. And we look forward to sharing our success with you, our shareholders, as we execute our plans in the coming year. With that, thank you, ladies and gentlemen. Before introducing Leon to give his Managing Director's presentation, I'd like to play for you a 3-minute video. This is Central 2021. [Presentation]

This is Central 2021. Now let me introduce you to Leon Devaney, who will present his Managing Director's presentation. If any time you have a question for Leon about his presentation, or indeed, my remarks, submit it online, and Leon and/or myself will answer those questions after Leon concludes his presentation. Thank you. Leon?

Great. Thank you, Mick. And I probably should have gone before that presentation. My technology skills on PowerPoint aren't nearly that good. So I'll do what I can to keep you entertained. Good morning, everyone. 6 weeks ago, we presented our 2021 annual results webinar, which detailed our current activities. The webinar is available on our website. And Mick has just done a very good job providing an overview of the business. So I'd like to use today to talk more about our current focus, which is on implementing our growth strategies over the next year. Before doing that, I'd like to look back on a very busy but also very challenging year. 12 months ago, we were dealing with COVID in weak oil and gas markets. Since then, markets have improved dramatically. We advanced key projects and funded growth activities. The year did not go without its challenges however, with some of our schedules taking longer than anticipated. I'll talk to these a little bit later. But overall, I think we can be proud of what we accomplished and how it's positioned the company to now deliver some real exciting exploration and appraisal activities over the next 12 to 18 months. Let me start with operations, which have been a solid foundation for the company over several years through very difficult trading conditions. We posted solid operating results, successfully navigated COVID impacts and delivered very important capital projects throughout the year. In doing all of this, we continue to operate our assets efficiently and with a strong focus on HS&E. We supported our local communities and maintain stakeholder engagement, although these were understandably impacted by COVID travel restrictions in the Northern Territory. And finally, we continued to track near our target for field operations of 1/3 indigenous employment and 2/3 local employment, which is very important to us, as you would be aware. In addition to that, our operating team completed a development program consisting of 4 recompletions and 2 new development wells at Mereenie. This project is adding about 30% to wellhead capacity or around $50,000 a day in additional revenue to the Mereenie joint venture. It is the first time we have invested in wellhead capacity at Mereenie, which has been in decline since we acquired the asset in 2015. With this additional production being sold into a very strong gas market, so the timing is ideal. Another positive outcome from the development program was at the West Mereenie 28, which was the second of the development wells drilled. We had sustained gas flows from the upper stairway. I'll cover this a little bit later. But the stayaway formation is a great opportunity for the Mereenie joint venture to increase reserves, and importantly, increase production and extend the life of that field. One of the main things that everyone would be aware of and saw over the past year is our asset sale. Last month, we sold 50% of our operating assets to New Zealand Oil and Gas and Cue Energy. This is incredibly important for the company. Consideration was valued at $85 million, which resulted in a book profit of about $35 million. Over the 6-year investment period, return on equity after debt service was over 33% per annum. So on a look-back basis, the acquisition of the operation -- operating assets have been very successful. The transaction also allowed us to meet our objectives, which were to retain operatorship, reduce gearing, and importantly, provide Central with non-dilutive growth capital. As part of the part of the transaction, we have $40 million in free-carry, which allows Central to fund more development wells at Mereenie, the upcoming 2-well exploration program at Palm Valley and Dingo, appraisals at Palm Valley in the future and an appraisal program at Mereenie for the Stairway formation. I'm looking forward to working with NZOG and Cue to deliver these investments and unlock further value in the operating assets in the years ahead. Turn our attention a little bit to Range, which I know a lot of people are interested in getting an update and understanding where that is at. Looking at that project, we concluded drilling 3 wells, pilot program in June, with testing of these wells currently continuing. The pilot well results were disappointing. And I'm not going to beat around the bush on that. They weren't what we expected. Our pilot location has an average net coal thickness of 25 meters and lower-than-expected water production. And we've made those announcements. The result was very different to our 4 exploration wells which are located around the permit and look much better, with net coal thickness ranging from 30 to 36 meters or around 32% thicker. So obviously, what we've seen around the permit through exploration was significantly better than what we've seen at the pilot location. The pilot results also were not consistent with some of the other wells that we've seen in neighboring blocks, which have net coal thicknesses ranging from 32 to 37. So again, substantially more than what we've seen in the pilot. In response, we're about to drill 2 step-out wells. One of these is Range 10, which will help us determine the extent of the coal variation to the northeast of our pilot. The other, Range 9, is located next to our Range 3 exploration well. So it will help us demonstrate the performance of coals, which are consistent with our broader exploration program around the permit. Ultimately, the process we are going through is fairly typical for CSG appraisal. But the need for the new step out wells has, as we've announced, necessarily delayed our FID target for the Range project. At this point, we are looking at a FID in early 2023, with first gas sales around 2 years after that point. I understand this is disappointing in terms of the schedule, and we are all here to see Range on production as soon as possible. So I can assure you, we are looking at ways to accelerate this program wherever possible. I do want to comment briefly on Monday's announcement from our Range joint venture partner, Incitec Pivot. They disclosed they're closing their Gibson Island plant in 2022, which is a major customer in the East Coast. From our perspective, it does not impact our share of Range production, which we can sell to any domestic customer in the East Coast. Obviously, Incitec Pivot would have been one of those opportunities, but what we're seeing in this very current strong market is there's plenty of depth, plenty of customers. So we don't -- I don't see that as having any impact on our share of production at Range. Also, I don't think IPL's decision to close Gibson Island will impact our Range joint venture activities. IPL have a need for gas without Gibson Island, so Range would be valuable either as a direct gas supply into the balance of their portfolio or as a natural hedge to counteract their gas demand requirements. Turning our attention to exploration. We've made some great progress in the Amadeus Basin. Under our asset sale to NZOG and Cue, we are fully carried for 2 exploration wells targeting deep formations at Palm Valley and Dingo. The targets to have a total mean recoverable volume of 192 petajoules, 96 petajoules being net to Central. Both wells are located with an existing producing fields. So new reserves can be brought online relatively quickly and at low cost, which is really important in terms of maximizing the value of any discovery. In addition, both exploration wells can become production wells from the currently producing formation. And again, this significantly reduces the investment risk of these 2 exploration targets. While the program has been contingent on completing the asset sale, which only occurred last month, our early efforts during the year on permitting approvals and long lead items has now made it possible to avoid the 12- to 18-month lead time that we're currently seeing for drilling of these Type 2 wells in the basin. We're next in line for a rig. So as soon as that gets released from its current drilling program, it will move to Palm Valley. We don't have an exact date, but we expect the rig to be released around the end of the year, which would allow for spudding at Palm Valley sometime in January. So it is close, and we're looking forward to getting that exciting program underway. In addition to Palm Valley and Dingo though, and we've talked about this early on when we started our farm-out process, we are continuing to progress 3 other exploration and appraisal projects that were ultimately not included in the asset sale. First, Orange, which is a drill-ready prospect, with a mean recoverable resource of 400 petajoules. It's a very large prospect. We hold 100% interest in Orange. So not surprising, exploration success at Orange will lead to a step change in our reserves and forward production forecasting. Second, Mamlambo is a process -- is a prospect targeting potentially large oil play in the western side of the Amadeus basin, where we hold 100% interest. This is a very under-explored part of the basin, which we know to be oil prone, having produced from Surprise and at Mereenie. Finally, we look at Stairway, which has moved up our priority list following the sustained gas shows at West Mereenie 28, which I talked to earlier. With about 100 petajoules of gross joint venture 2C resource, this airway presents a really good opportunity for the Mereenie joint venture to materially increase reserves and production into the future. Given the strong oil and gas market, which I'll talk to later, we consider these 3 prospects to be attractive near-term growth opportunities and something we certainly want to try and progress over the next year. All right. Turning to everyone's favorite subject, Dukas. Clearly, progress has been slow. There's no doubt about that. And I know that is frustrating given how close we were to a result in the 2019 drilling program. I want to clarify at this point that the Santos farmout that was signed back in 2012 has now been fully satisfied. What that means is there are no more farmout obligations under the joint venture that Santos has to adhere to. We are essentially operating now within more traditional joint venture arrangements where Central is the minority non-operator party. Now having said that, Dukas is a commitment well at the end of next year. And what that means is we are now starting to see some real progress in that permit. Santos recently proposed a 2022 -- calendar year 2022 joint venture budget that targets drilling Dukas in March 2023. This is later than we wanted, but it's still positive signs for exploration drilling at that permit, which we view as very positive. Just briefly on the recent farm-out activities at Dukas, and there's been some discussions and news about this. I want to comment on it very quickly. Santos just disclosed a farmout with Peak Helium. We welcome that transaction and consider it positive news for the joint venture. You may also recall that a few months ago, Santos waived their carry option on Dukas with us. And that resulted in our interest in the Dukas permit increasing from 30% to 45%, which is obviously a fairly large jump with no consideration. What that means is it allows Central to now consider our own farmout opportunities, including discussions with groups like Peak Helium. I want to make very clear however that from our perspective, the Dukas well needs to be drilled as soon as possible regardless of any farm-outs, whether it's by Santos or ourselves. And it needs to happen within the permit very, very quickly. And it's something we continue to press the joint venture for, so be assured of that. Moving on to Zevon. In addition to Dukas, we've been progressing Zevon, which is our other subsalt prospect, where Central operate and hold 100% interest. It's located in the northwest part of the Amadeus Basin. Zevon is potentially bigger than Dukas and at a shallower depth, which means it reduces drilling costs and drilling complexity, which is obviously very advantageous in moving that program forward. We are progressing a seismic program at the moment, which would allow potentially for drilling in 2023. Based on our sub-salt play mapping, both Dukas and Zevon are multi-TCF targets, with the potential for natural gas as well as other high-value gases like helium and hydrogen. Both targets are major sub-salt exploration, so it's not surprising when we are considering farm-outs and other options that are available to us to accelerate this drilling. Okay. Moving on to our balance sheet and gearing, which was a topic of some concern for shareholders a year or 2 ago. Our gearing has been high relative to its peer group since we used project finance to purchase most -- to provide most of the funding for the purchase of our operating assets. We've also used gas delivery liabilities, like presale agreements and over-lifting to avoid dilutionary equity raises, which I think has been a great result for shareholders. As this chart illustrates however, we have now reduced our debt and gas delivery liabilities by 50% over the past year, which again will improve the complexion of our balance sheet going forward. So I think that's a great result for everybody. I do want to take a moment to highlight how effective our capital strategy has been over the past few years. Our last equity raise was over 4 years ago in 2017. And we've taken advantage of very low-cost debt capital to acquire quality operating assets, which we have now sold at an attractive profit to fund new growth. Still, Central is a small company with a very large exploration portfolio, so we will continue to balance capital management with our opportunities for growth. I want to change gears at this point and comment on a few things that impact the delivery of our growth strategies that we've been talking about. The first is there continues to be a significant development in ESG, which is evolving almost on a weekly basis, notably, climate change and the global push to reduce carbon emissions. At this point, we don't see major impacts on the inputs to Central's business. Gas markets are very strong. Insurance is available. And although it is taking longer, we still have a regulatory pathway to explore and operate. Having said that, the implications of climate change are clearly an emerging challenge for Central and our sector more generally. We take this issue very seriously and recognize the need for proactive management, which is why we are already progressing projects to materially reduce our Scope 1 emissions, particularly at the Mereenie field. In addition, our focus on producing gas as a low-carbon transition fuel, combined with very low associated CO2 and the relatively small environmental footprint of conventional gas in the Amadeus Basin, give Central some distinct advantages in navigating ESG going forward. Moving on to some other challenges that we do face that I think are worth highlighting. The first is that we are seeing some substantial cost increases in our business and growing lead times for exploration. There are a variety of factors contributing to this. Environmental regulations, for example, have become overly cumbersome. To illustrate, the 144 Pepper inquiry recommendations, which were intended only for the Northern Territory shale industry, have now been applied to all onshore operations in the NT, including our conventional fields where we have no current plans for fracking. So you can imagine the level of additional work that we're going to be burdened with just to do what we've been doing for the past few decades. Other factors include COVID supply change -- supply chain disruptions, skilled labor shortages for service providers and recent increases in the price of steel and other commodities, which I suggest you probably have heard as an issue for many industries and sectors, particularly in the energy sector here in Australia. The practical impact is that it now costs more and it takes up to 18 months to get a well in the ground, which significantly extends the cycle time for exploration and appraisal. This means we can't do as much as we want as quickly as we want, and we need to navigate those. And those goalposts are changing, so schedules are subject to a bit of uncertainty naturally. Moving to some positive news. And offsetting these challenges though, we have an incredibly strong rebound in oil and gas markets. During the COVID market downturn in 2020, we were hoping for some stability in 2021, with a recovery possibly from 2022, 2023. As these charts illustrate however, the rebound has been much quicker and much stronger than anticipated. Oil prices, for example, are up 100% from where they were a year ago, with domestic gas prices showing a similar strong rebound. Current prices at Wallumbilla are over $10 a gigajoule, up more than 50% from a year ago. The strong demand for non-firm gas production, which, as you may recall, we struggled to sell in 2020, is also something that we're seeing in our current marketing activities. Our current expectation for the domestic market is that short-term volatility will continue, but market conditions for term supply will continue to be strong in the near and medium term. This outlook provides a real boost to our growth strategy, which aims to find, appraise and produce new oil and gas reserves, along with other high-value gas commodities like helium and nitrogen. So in wrapping up, I want to acknowledge that our share price isn't where we expect it to be given what we have accomplished over the year or the exploration and appraisal activity that lies just ahead. Some of this weakness reflects sector-wide pressure related to the emerging risks around climate change. But I think equity markets will work through this uncertainty and eventually reflect the strong oil and gas market fundamentals that we are currently seeing. I also think there's an element of timing. Central moved from a very defensive stance in 2020, where you recall, we shut down a lot of our growth activities really to conserve cash and preserve our financial strength. And in 2021, we went back to sourcing funding and restarting those activities. We are now currently in an implementation phase where the results in subsequent value from these investment lies just ahead of us. In summary, we have a clear objective to increase our reserve base and grow sales revenue, while diversifying our portfolio across different basins, play types and commodities. It is an aggressive growth plan for the company the size of Central, that is supported by our technical work and the market fundamentals we are currently seeing, which is why we believe our strategies will create sustained shareholder wealth going forward. Finally, I appreciate the support and continued trust that you as Central shareholders have placed in the Board and the team at Central to now deliver on these important strategies in the year ahead. So with that, I'd like to thank you and hand over to Mick.

Great. Thanks, Leon. We've got questions. So firstly, a question from the floor to either Leon or myself? Given that Leon did most of the talking doesn't mean he's the smarter one, so.

[Operator Instructions]

I think I'll call it. Damian, what about online?

We do. We do have a couple of questions online, including one caller who's been on standby for some time. So we might try to see if this technology works and see if we can cross through to shareholder Michael, who has a question.

Thank you for the opportunity. As the Chair's letter in the annual report says, Central strategy is quite clear, i.e., explore and develop new oil and gas resources and bring them to market. Has the Board reviewed the strategy in light of the International Energy's conclusion that there is new need that any new oil and gas field beyond those original development in the pathway to net 0 emissions by 2050? This question is given even greater urgency in light of the fact that the leading science and COP26 is now saying that to have even a 50% chance of maintaining a habitable planet in the medium term, we, in fact, need to go to net 0 by 2035, not 2050. Thank you.

Michael, thanks very much for your question. Much appreciate it. I'll give you a short answer, a long answer, a short answer in respect to Board considering the nature of Central Business. No, it hasn't. Central is an oil and gas company. The longer answer is, our view, the board's view, the company's view remains that we are part of a transition from basically a fossil-burning economy to where we'll get to, which will be a cleaner energy future. There's no question about that. And we at Central don't dismiss that. And we certainly agree with it. The question for us is, when will all that happen? And I've been very vocal for decades in respect of the time line. Yes, I can appreciate the import of your question, which is about, you'd much prefer to have oil and gas fossil burning fuel shutdown tomorrow. I must prefer to have it transition to the cleaner energy future that we all wish to have without destroying not knowing the environment, but the lives a lot of people. So thank you for your question. Disappointing as my response will no doubt be to you, as I'll say it again, Central is an oil and gas company, and we'll continue to play a role in the transition. Thank you.

So I do have from the Internet, Mick, question. Would directors like to comment on possible carbon capture and storage business opportunities presented by Mereenie and other gas fields? And any active initiatives that the company is pursuing in this regard?

Indeed, we would. And I might pass to Leon because of the action.

Yes. Look, it's -- obviously -- yes. So Santos has obviously been at the sharp end of the spear on this technology and have made great progress in Australia. We do see some opportunities, and we have talked to NZOG as our new joint venture partners and Macquarie in terms of CCUS, both at Mereenie, which could be used for enhanced oil recovery, for example, but also at some parts of our depleted field at Palm Valley, which both those fields have been operating for decades. And there are opportunities with more depleted parts of the field to use it as CCS. They're great reservoirs. They've contained natural gas for a very long time. We think it's a real potential opportunity going forward, and we're looking to do studies on how to optimize that and where the opportunities are between those 2 fields. And we are actually in discussions with companies that have ideas about bringing industry into the Alice Springs area that could benefit from carbon sequestration, which I think would be really interesting. So we see that as a great opportunity in the future. We have not been out promoting it. We need to go and do some technical studies in the field. And we need to find a good partner that has a business model that works that can utilize carbon capture and storage to create a more green energy solution. So it's something on our radar. It's something that all 3 joint venture partners are aware of and very interested to progress moving forward. So we do see that as a possible opportunity that could have value for the business.

Thanks, Leon. Next one?

Yes. Mick, one more question again from shareholder Robert. Would you like to comment on the trend increasingly demonstrated by other companies for refocus and rebranding from petroleum to energy in the company's name and the relevance to Central Petroleum?

Yes. Thanks, Robert. Thanks for the question. It is indeed a little bit topical. We haven't given it too much focus, but we were talking about -- casualty we had a Board meeting yesterday. And after that, we're talking about it somewhat casually given the name changes that other companies are going through. And I'll say this a little bit flippantly, but we've mentioned hydrogen and helium earlier this morning, and we were thinking about Central Helium, Central Hydrogen. So yes. No, I sound a bit flippant there, Robert. We haven't given it a great deal of thought. But like yourself, we do acknowledge that a number of companies have either changed or contemplated changing their names.

No more questions.

Good. Thanks, Damian. All right. So let's now turn to the -- sorry, you may, sir.

About the cost of getting gas to market from Central to the East Coast, it goes via the pipeline through Jemena. Is that right?

Jemena. Unfortunately, yes.

That's what I'm asking about.

But that's good to go there, but it's unfortunately what they charge anyway.

I imagine that's -- I would do that. There's a proposal to build a pipeline down to Moomba.

Moomba. Yes.

Is that ever going to happen? What's the story there?

Well, it's a good question. And the best answer for Central is that we would like to see a number of options. As you pointed out, currently, gas can get to the East Coast via the existing infrastructure. If Leon and his team are successful with all their exploration activities and a lot more gas is committed, if you like, certified, that will give the impetus.

Is that going to be the catalyst?

That will probably be the catalyst. Yes. But importantly for us, it's -- we just want to see any potential pipeline, we're looking at the cheapest way to get our gas to the market. So once there's another pipeline mooted, we'll get -- probably get a bit of response from the existing infrastructure providers. So it's all -- the more gas we can find, certify, the more chance we've getting cheaper gas to market. And I'll just point -- I'll make a point, one point, just a quick step aside. Lots and lots of talk in the last year or 2 around the Beetaloo. And there's obviously very prospective targets there. But it's a bit of a disappointment to the company that we've made representations to the governments, various governments that -- the governments, but they're ignoring the fact that Amadeus has been producing for 30-plus years. It's highly under-explored infrastructure there already. So I don't know why -- the bigger companies obviously got into the ear of government, and the focus is on Beetaloo. As you've heard, so our activities involve no fracking and Amadeus is under-explored. I've given you 2 answers to the price of one there, sir. Thank you.

Right. Now let's turn to the business of -- sorry, business of the meeting. Ladies and gentlemen, the purpose of today's meeting is to deal with the formal business as set out in the notice of Annual General Meeting dated the 8th of October 2021. As shareholders, you have all received a notice of meeting. If there are no objections, and effort to expedite proceedings, I move that the notice of meeting be taken as read. I'll take silence as no objections. Which then takes us on to the meeting agenda. The items of business on the agenda are set out in the notice of Annual General Meeting. These are represented by consideration of the financial report for the year ended 30 June 2021 and 9 individual resolutions. The minutes of previous meeting. Minutes of the previous meeting of shareholders held on the 10th of November 2020 are available by request from the Company's Secretary, Mr. White, at the conclusion of the meeting or by e-mailing [email protected]. Proxies. Based on Item 2, proxies and direct votes have been received from 238 shareholders, representing 119,373,837 shares, which is 16.45% of the company's issued capital. All proxies and direct votes have been received by and validated by Computershare. As Chair of this meeting, I advise that I intend to vote all undirected proxies in favor of Items 2 through 4E. As discussed earlier, we will conduct a poll on Items 2 through 4E. I appoint Mr. Brimelow of Computershare as returning officer and to conduct the poll and to report to me the results of the poll. Mr. Brimelow will have power to co-op his agents, as his agents, members of his staff and other company representatives. The persons entitled to vote on this poll are all shareholders, representatives and attorneys of shareholder and proxy holders. For some items of business, certain votes will be disregarded as explained in the voting exclusion statements in the Notice of Meeting. So with that, Item 1, financial statements and reports. The first item of business of the meeting is to receive and consider the annual financial report of the company. I note in our table the financial report of the company for the year ended 30 June 2021, together with the directors declaration, directors report and the auditor's report. This is also an opportunity to ask questions on the company's auditors, PricewaterhouseCoopers, on the conduct of the audit. Marcus Goddard, who I have introduced earlier from PwC, is available for responding to questions relating to the financial reports. Any questions on the annual financial reports from the floor firstly? None concerning the conduct of the audit. Mr. Galvin, nothing? There is no comment for vote on the acceptance of the financial statements and reports. And as such, we now move on to the first resolution of the day. Item 2, adoption of the remuneration report. The Corporations Act requires all listed companies to present their remuneration report for each financial year for adoption by shareholders at the company's Annual General Meeting. The report can be found within the directors report section of the annual report. This resolution of shareholders is advisory only and is not binding on the directors of the company. Members of the key management personnel and their proxies and closely related parties are restricted from voting on this resolution. Resolution for Item 2 states, that for the purpose of Section 250R-2 of the Corporations Act and for all other purposes, approval is given for the adoption of the remuneration report as contained in the company's annual financial report for the financial year ended 30 June 2021. Are there any questions or discussion on the motion firstly from the floor? Nothing from Mr. Galvin. I confirm that the company has received valid proxy votes and direct votes in relation to Resolution 2, and these are displayed on the screen. With those online attendees, now please cast their votes if you have not done so already. In person voting on this resolution be conducted at the end of the business of this meeting. [Voting]

Item 3, reelection of directors. There are 3 resolutions under this item of business, each dealing with the reelection of directors. Resolution 3A, reelection of Director, Mr. Stephen Gardiner. Resolution 3A states that, Stephen William Gardiner, a Director appointed by the Board since the last general meeting of the company, retires in accordance with the constitution and ASX listing rules and being eligible, is reelected as a director. Mr. Gardiner, can you say a few words to introduce yourself to shareholders, please?

Certainly. Thanks, Mick, and good morning, ladies and gentlemen. So a little bit about myself. I have over 40 years of corporate finance experience at major ASX-listed companies, most recently with Oil Search for 17 years, including 8 years as CFO. While at Oil Search, I had a range of executive responsibilities, including corporate finance and control, treasury, tax, audit and assurance, risk management, Investor Relations, ICT and sustainability. I also served as Group Secretary for 10 years while performing those finance roles, which enhanced my corporate knowledge -- corporate governance knowledge and experience. Prior to Oil Search, I held senior corporate finance positions at major multinational companies, including CSR and Pioneer International. I believe I have a particular strength in capital management and funding across both debt and equity, having raised many billions of dollars, including via complex structured financings. I'm positive that my background and experience will enable me to perform to the Board of Central Petroleum. Thank you.

Thanks, Stephen. And on behalf of the Board, we're very happy to have Stephen on the Board. Damian, any questions direct to concerning Mr. Gardiner? I confirm that the company has received valid proxy votes and direct votes in relation to Resolution 3A, and these are displayed on the screen. With those online attendees, now please cast your votes if you have not already done so. In-person voting on this resolution will be conducted at the end of the business of this meeting. [Voting]

Resolution 3b, reelection of Mrs. Kathy Hirschfeld AM. Resolution 3B states that Katherine Anne Hirschfeld AM., a director retired by rotation in accordance with the constitution and the ASX listing rules and being eligible, offers herself for election as the director, is reelected as a director. Kathy, can you say a few words to introduce yourself, please.

Thank you, Mick. I joined the Board of Central Petroleum in December 2018 and was reelected at the 2019 AGM. As well as serving on the Central Board, I currently chair PowerLink, Queensland's high-voltage transmission company. And I'm on the Board of Queensland Urban Utilities, who provide water and surge services to around 4 million people in Southeast Queensland. With my background in chemical engineering, most of my executive career was with BP in oil refining, with some time in logistics and upstream in Australia, the U.K. and Turkey. This culminated in 5 years as CEO of BP's oil refinery in Brisbane, after a similar role at the joint venture refinery in southern Turkey. As a result, I have extensive experience in operations, safety and risk management in hazardous industry. Since 2010, I've been a professional non-executive director, serving on listed government, private and not-for-profit company boards. These include companies such as Snowy Hydro, Broadspectrum and InterOil. The companies I've worked with have always had a strong focus on the engineering, energy and utilities. And I have chaired risk, people and safety committees for a number of those boards. I have developed strong governance and strategic oversight. I believe my skills and experience along with those of my fellow directors will help Central Petroleum to achieve its strategic goals safely and efficiently and deliver value for you, our shareholders. Thank you. And I look forward to your support.

Thanks very much, Kathy. And again, on behalf of the Board, we certainly appreciate Kathy's skills, experience and enthusiasm around the Board table. Any questions concerning the motion to reelect Kathy from the floor? Mr. Galvin? As none, I confirm that the company has received valid proxy votes and direct votes in relation to Resolution 3B, and these are displayed on the screen. With those online attendees, please cast your votes now if you have not done so already. In-person voting on the resolution will be conducted at the end of the business of this meeting. [Voting]

Resolution 3C is the reelection of myself. As this resolution relates to myself, I will ask Kathy Hirschfeld to chair the meeting for this resolution. Thanks, Kathy.

Thank you, Mick. Ladies and gentlemen, Resolution 3C states that Michael Joseph McCormack, a director, retires by rotation in accordance with the constitution and the ASX listing rules, and being eligible, offers himself for election as a director, is reelected as a director. Mr. McCormack, can you say a few words about yourself to shareholders?

Yes. I will indeed if you say so. Good morning again, folks. I joined your board in September last year and was reelected to the Board at last year's AGM. Shortly after the AGM, I became Chair after the resignation of Wrix Gasteen. I'm also on the boards of Austal Limited and Origin Energy Limited as well as a number of not-for-profits. As is usual practice and the requirement to have a certain percentage of directors reelected each year, I'm now standing again this year for reelection at this AGM. Now by way of background, I've had executive -- I had an executive career of 36 years, culminating in my retirement from APA Group in 2019 in my 15th year as CEO. My entire career has been spent in the energy infrastructure industry, and which I can claim during my time with APA, I have owned, operated, managed most of Australia's gas transmission and distribution systems. In addition, my experience includes developing gas-fired power stations, gas processing facilities, LNG processing facilities, electricity transmission, large-scale renewables, that is wind and solar, across the country. The success of APA under my leadership is well known, growing its enterprise value from $1 billion to $24 billion, delivering compound annual shareholder returns of over 17% during my tenure. My career has always been about growing a business, and that is where my interest remains in asking for your support to continue as a Director of Central Petroleum and work with both the directors and management to help manage the company execute its growth plans that have been talked about earlier. As Australia continues with the energy transition, which will take many years to complete, in my view, the demand for reliable and affordable gas supply into the Southeast Australian market will continue. It is this demand that Central growth plans are hoping to satisfy, and which I believe my skills and experience will be of value to the company in pursuing its growth plans. In summary, I'm delighted to be offering myself up for reelection to your Board. And I believe my skills and experience will help Central Petroleum make prudent investment decisions, continue its safe and efficient operations, managing the interest of stakeholders, and importantly for you, our owners, a continued focus on value creation. Thank you. And I look forward to your support.

Is there any discussion on the motion? If there are no questions, I confirm that the company has received valid proxy votes and direct votes in relation to Resolution 3C, and these are displayed on the screen. With those online attendees now please cast their votes if you have not already done so? In-person voting on this resolution will be conducted at the end of the business of this meeting. [Voting]

Thanks, Kathy. I'll move on to Item 4, the issue of share rights to nonexecutive directors. There are 5 resolutions under this item of business, each dealing with the issue of share rights to nonexecutive directors. By a way of explanation, this resolution seeks to approve the issue of share rights to nonexecutive directors who elect to sacrifice up to 25% of the 2022 financial year base fees inclusive of superannuation, but excluding committee fees, in order to receive an equivalent value in the form of share rights issued under the company's employee rights plan. This in turn is to enable the nonexecutive directors to progressively share in the growth and sustain the value of Central by acquiring a shareholding in the company, with a value equal to the total annual base fee remuneration plus superannuation. I'll note that over the past years, and by the past year, I mean, since I've been on the Board, it has been somewhat problematic for those directors, like myself, who whilst wanting to buy shares in the company have been unable to do so because we are in possession of market-sensitive information. I'll also note that the issue of share rights to nonexecutive directors is quite common with other companies in a similar situation with the most announcements are of significant relevance to the prospects of the company in addition to the nonexecutive directors in Central will acquire, as I said earlier, over a 4-year period, 100% -- the equivalent of 100% of their base fees in the company's shares, notwithstanding any other opportunity to acquire additional shares. If any of the resolutions in Items 4A to 4E are not passed, the company will not be able to proceed to issue the share rights in respect of the relevant director. It simply means that the 2022 financial year base fee will be paid in cash rather than shares. Are there any questions on the resolutions for the issue of share rights to nonexecutive directors? And I just -- these share rights are commonly known as sweat equity. So rather than taking cash, we're just taking shares. So questions from the floor? All right. Approval of the issue of share rights to myself, as this is another resolution that relates to myself, I'll ask Kathy to chair the meeting for the resolution. Thank you, Kathy.

Thanks, Mick. Ladies and gentlemen, Resolution 4A states that for the purposes of ASX Listing Rule 10.14 and for all other purposes, approval be given for the grant of a number of share rights, determined in accordance with the formula outlined in the explanatory statement to Mr. Michael McCormack or his nominees under the company's employee rights plan and otherwise on the terms and conditions set out in the explanatory statement. Is there any discussion on this item or questions? No. I confirm that the company has received valid proxy votes and direct votes in relation to Resolution 4A, and these are displayed on the screen. Would those online attendees now please cast their votes if you have not already done so? In-person voting on this resolution will be conducted at the end of the business of this meeting. [Voting]

Thank you again, Kathy. We'll move on to Resolution 4B, which is the approval of the issue of share rights to Mr. Stuart Baker. Resolution 4B states, that for the purposes of ASX listing rule 10.14 and for all other purposes, approval be given for the grant of a number of share rights, determined in accordance with the formula outlined in the explanatory statement to Mr. Stuart Baker or his nominees under the company's employee rights plan and otherwise on the terms and conditions set out in the explanatory statement. Are there any questions or discussion on the motion, firstly from the floor? No. Thank you. I confirm that the company has received valid proxy votes and direct votes in relation to Resolution 4B, and these are displayed on the screen. Would those online attendees now please cast their vote if you have not done so already? In-person voting on this resolution will be conducted at the end of the business of this meeting. [Voting]

Move on to Resolution 4C, the approval of the issue of share rights to Mr. Stephen Gardiner. Resolution 4C states, that for the purposes of ASX Listing Rule 10.14 and for all other purposes, approval be given for the grant of a number of share rights, determined in accordance with the formula outlined in the explanatory statement to Mr. Stephen Gardiner or his nominees under the company's employee rights plan and otherwise on the terms and conditions set out in the explanatory statement. Is there any discussion on this motion, on the floor? No. I confirm that the company has received valid proxy votes and direct votes in relation to Resolution 4C, and these are displayed on the screen. Would those online attendees now please cast their votes if you have not done so already? In-person voting on this resolution will be conducted at the end of the business of this meeting. [Voting]

Resolution 4D, approval of the issue of share rights to Ms. Kathy Hirschfeld AM. Resolution 4D states that for the purpose of the listing Rule 10.14 and for other purposes, approval be given for the grant of a number of share rights, determined in accordance with the formula outlined in the explanatory statement to Ms. Katherine Hirschfeld AM or her nominees under the company's employee rights plan and otherwise on the terms and conditions set out in the explanatory statement. Is there any discussion, questions on this motion? Thank you. Would those online -- sorry, would those online attendees, please cast their votes if you have not done so already? In-person voting on this resolution will be conducted at the end of the business of this meeting. [Voting]

Resolution 4E, approval of the issue of share rights to Dr. Agu Kantsler. Resolution 4E states that for the purposes of ASX listing Rule 10.14 and for all other purposes, approval be given for the grant of a number of share rights, determined in accordance with the formula outlined in the explanatory statement to Dr. Agu Kantsler or his nominee under the company's employee rights plan and otherwise on the terms and the conditions set out in the explanatory statement. Are there any questions, discussion on this motion? Damian? Thank you. I confirm that the company has received valid proxy votes and direct votes in relation to Resolution 4E, and these are displayed on the screen. Would those online attendees now please cast their votes to the resolutions if you have not done so already? [Voting]

As this is the final resolution, we will now conduct the in-person poll on Items 2 through 4E. Details of which are obtained -- are contained online or on your board mission card. If there is any person present who believes they are entitled to vote that has not yet registered to vote, would you please raise your hand for assistance? I will now pause to our shareholders and proxy holders to finalize their votes online and in-person. [Voting]

I think that's the last one. Would you please indicate by raising your hand if you need more time. I think that's all that will be taken up. Mr. Brimelow, all done? Thank you. Okay. So Mr. Brimelow informs me by signal that all required voting papers have been collected and sufficient time has been permitted to allow online voting. So until he comes back with the raised hand, we'll just have to wait for a few moments. Just -- you said a couple of words there that would be foreign to me and reflect the process. I've asked the floor expert to go out and interpret them for me. Right. That means closed. I mean, clearly, I can understand that one. So ladies and gentlemen, Mr. Brimelow informs me that all required voting papers have been collected and sufficient time has been permitted to allow online voting. So I now declare voting closed, the poll for Items 2 through 4E. The results of the voting will be notified to the ASX in accordance with the Corporations Act and the listing -- ASX listing rules later today. Ladies and gentlemen, that now concludes today's formalities. I would like to thank you for your attendance, either here in person or online, and your continued interest in the company. And invite those here in the Christie Center to join the board and the company's senior executives for refreshments outside and an opportunity to ask additional questions. I'd also like to thank those who attended online, which you've already done and who are encouraged to, if you've got any other further questions, please ask them via the company's website or e-mail via info@centralpetroleum. Thank you very much for your continued interest in the company. And thank you, ladies and gentlemen. Have a good day.