Valeura Energy Inc. (VLE) Earnings Call Transcript & Summary

Hi, everyone. Welcome to Valeura Energy's 2024 Results Webcast. I'm Robin Martin, Vice President, Investor Relations. And joining me here in Bangkok is Sean Guest, our CEO; Greg Kulawski, our COO; and joining from Singapore is Yacine Ben-Meriem, our CFO. We are recording the event today, March 26, and we'll make a replay available through our website later today. Running order for the day. I'm going to hand over to Sean and Greg and Yacine in just a moment to take you through some prepared slides that we've got. They're also available on our website if you'd like to download a copy. After that, we'll get into a Q&A session. [Operator Instructions] So with that, I will hand it over to Sean. Go ahead.

Thank you very much, Robin. Thank you very much, everyone, for joining us here this evening or this morning, wherever you're located. So a lot of the results for us in Q4 -- sorry, 2024 will have come out over the past few months, our production results, our cash at year-end. And then people will have seen that reserves were announced just over a month ago. So that information is out there. But what's kind of important today beyond the financials and the other financials is also just to recap that because it was an extremely good year for the company. So if I just step down to really the results, if you look at production, production in 2024 was up 12% on the year before 2023. And this was on the back of bringing Wassana on and having the Wassana field on for most of the year, but we also developed a new area of the Nong Yao field, Nong Yao C, and that was successfully brought on in August. Now important also was that we had a drill rig working for the full year, doing a lot of infill development drilling, which really supported that production. Important for us as a company is really on the reserves, and we had another stellar year of reserve replacement in that area. Even though production was up, we actually had almost a 250% reserve replacement ratio on the 2P numbers. And the life of all of the 4 fields that we're operating were all extended, and that's taken them out into now the 2030s, all of the fields. In addition, the 2C was increased 140% and we drilled three exploration wells and a number of appraisal wells while doing our infill drilling and had success across all of those, which are going to support more appraisal and development drilling in the future. On the efficiency side, we reduced the OpEx down to $25.7. We came in on our CapEx below our guidance. And even with that, we actually drilled more wells than were planned. So the efficiency we saw in the drilling really came not just in cost savings, but also in more activity. And finally, with some good -- very good work by the team, we saw we were able to reduce our emissions intensity by approximately 20% in our first year of operation. and we've got more coming on that in the current year. Now all of those elements then really lead into the cash flow. And that's what we saw exiting the year-end with $259 million in cash. But importantly, we also completed in Q4, the corporate restructuring to bring the Thai III companies together, and that will actually access about $400 million in tax losses. And as we kind of say, that's really going to supercharge our cash flow in the near future. When you put that together then, we've really seen the net asset value, and that's the value of the cash and the 2P reserves value is just over $1 billion now. And if you look at that in share price, that's over CAD 13 a share. Now in doing all of that and all of that activity, we're also extremely pleased. We had no environmental or serious safety incidents, a very good result for the year as well. Now how does that work out for shareholders? Well, if we look back to January 2024, actually, we were trading at under $3 a share at that time. So now we're seeing ourselves bounce around $8. There's been a significant increase there. We also saw a recognition in 2024 externally. We, from the Energy Council, we were the Energy Company of the Year in the Asia Pacific region, Executive of the Year. And then when you look at our environmental performance, we were awarded by the Ministry here in Thailand for actually our work on two of the fields in our environmental monitoring on those fields and our performance there. And finally, then with that strong share price growth, with the revenue growth that we've seen, we recognized in Canada. I think we were #8 out of over 400 public companies they analyzed for the top growing companies in Canada. So again, a very good performance for the year. But really, what's important as we look at this is also the value of the company going forward. And what underpins that and the increases in share price is really down to the reserves, right, and the future of the field. So looking at that and just reiterating what we put out just over a month ago, when we took over these fields over -- just over 2 years ago, we had about 29 million barrels of reserves. We now at the end of leap year '24 are having 50 million barrels of reserves. So we found about 37 new barrels of reserves. And really, it's important to note that because that's actually more than we actually acquired with the KrisEnergy and the Mubadala acquisitions at the time. So we've seen very good over 200% reserve replacement and then we got almost 250% last year. When you look at that, of course, converting value, you would expect an increase, but recognize the increase in the 2P value to $752 million is actually you're looking at a slight decline in oil price during that period. I also want to note there, too, important as the 2P is, you can see the significant increase in the 1P reserves value, which is up over 400% from 68 million to 359 million barrels. So very good result across reserves. And really, the thing we've been trying to address that is important for everyone is extending the field life. And we can see just under 2 years of operations to get to the end of last year. Manora field was extended out into the 2030s over 4 years. And you can see Wassana the most was actually extended by over 8 years of reserve life. And we like to emphasize, too, as we go towards the Wassana FID on the redevelopment that we expect more reserves to come in once we take final FID decision. So extending that field out well beyond 2035, likely towards 2040. So all in all, extremely pleased with the operational performance, the safety performance, emissions, reserves additions. It's been a very good year for the company. And at that point, I'll hand over to Yacine to take you through the financial numbers. Yacine?

Thanks, Sean. Greetings, everyone. I guess, as Sean mentioned, in 2024, and I would say even Q4 '24 has been an extraordinary period for us for the company. And I think what you have in front of you is just some highlights that can substantiate how extraordinary this year has been for us. So I'd like to do is really walk you through first on Q4 and then kind of -- and then I'll expand on what the financial looks like for the full year in 2024. So we've -- during the last quarter in Q4, our production averaged around 21,000 barrels a day, which was higher 18% compared to last period. This resulted for the full year of an average production of around 22.8, which is, as you can see here on the screen, is pointing towards a 43% increase compared to '23. But bear in mind that these are -- in 2023, we only had production for the -- since we closed the transaction with Mubadala, which is in March. On a pro forma basis, as Sean mentioned earlier, on a 12% increase. Q4 also, we've seen quite a large number in terms of lifting. We've lifted more than we produced. As you can see on the screen, we lifted around close to 3 million barrels and at the realized price of around $67.7 a barrel. That translated for the full year of a total lifting of 8.35 million barrels, which is again 43% higher than last year and an average realized price of $81.3, which is again at a premium to Brent. On the OpEx side, for Q4 with an increased production, we've managed to deliver a $22.8 per barrel in terms of OpEx, which is a significant increase compared to the last quarter. And again, you can see that in terms of the year at $25.7. OpEx came in at $39 million in Q4 and for the full year is $134 million. And this translated in the -- again, these extraordinary results for the quarter and for the year. For this quarter, we've booked $222 million in revenues. Our EBITDAX was $132 million, and our cash flow from operation quite substantially $107 million, which resulted in around 114% increase compared to last quarter. And for the full year, you see how this can magnified into $680 million in terms of revenues and EBITDAX of $300 million, close to $380 million. And importantly, in after-tax cash flow of around $273 million. As a reminder, Sean mentioned earlier on, we've managed to do the tax consolidation, which I'll talk a little bit more about it, but that only occurred in November 2024. So we've only had a benefit of 2 months in terms of those tax consolidation. And maybe looking at the balance sheet, as Sean mentioned earlier on, we ended the year with $259 million of net cash. Our book value has increased more than 86% to just shy of $530 million and our adjusted working capital of $206 million. Now -- sorry, Robin, do you mind going to the next slide, please? So this is what -- in terms of financial for the quarter -- for the year, you can see, as I said earlier on -- sorry, for the quarter. And I would like to draw your attention really to the -- on the waterfall there on the top of the financials in terms of our pretax adjusted cash flow of $134 million. And then after that, we'll have the tax payment, which consists of SRB and PITA. And I think for people who have been with us who have been following us for a while, you can see that like this is an unusual situation where you have a much smaller PITA than SRB. But that's effectively the benefit of the tax consolidation to a certain extent. We have -- out of the tax losses that we have in -- when we did the consolidation of just $400 million during this period, we've consumed around $32 million. those tax losses. And that resulted in a very small PITA effect -- PITA accrual of around just $1 million. However, SRB, this is the Q4 is usually when the SRB get kicked in just because of the calculation. So we've accrued $26 million on SRB. And this resulted in an adjusted post-tax adjusted cash flow from operations with a margin of around 47%, significantly higher than we had in any of the previous quarters. It's really on the back of lower taxes, thanks to the tax consolidation and as we said earlier on, lower operating costs. And maybe I will not draw much attention on the cash bridge because I think it might be more helpful to look at it from a year-to-year basis. Next slide, please, Robin. So for the full year, as I said, $679 million in terms of revenues with royalty with OpEx and SG&A, we end up with a pretax cash flow of $357 million. During the year, we have accrued and paid some of the taxes that you can see, that you can see on the screen of PITA around $55 million and SRB of $29 million, resulting in an adjusted cash flow from operation of around $273 million, which equates to around 40% margin. So you can see the difference in terms of that tax consolidation can have in terms of that cash flow from operations margins. Now how does this translate in terms of the cash bridge there at the bottom? We started the year with $151 million, our $273 million of adjusted cash flow and spending on CapEx of $130 million and expects -- and a change of minor change of capital. In addition to that, during this year, this is where we acquired the FSO and the acquisition is and remain a highly accretive one as it helps us optimize and reduce our operating costs. I think as maybe a reminder for everyone, our payback period for acquisitions is 2 years, and we've already had 1 year under operations. We also had an additional tax that's related to the prior owner of the Mubadala assets, and that's come in at the $13 million. We are still in discussions with the owner in terms of trying to recoup this under the SBA, and that discussion is still ongoing. With all in, we end up -- as Sean mentioned, we -- as you can see on the screen as well here, we end up with a cash balance at the year-end of $259 million. Next slide, please, Robin. I mean, obviously, I think we've discussed this before, and we've been flooded in prior discussions. But as a reminder to everyone, when it comes to the [ RO ], how much improvement and how much effort has been put to try to reduce that liability. I think when we first closed the transaction with Mubadala, a lot of the investors have been pointing to the size of that liability. But I think the message from our side and based on technical and not just withstanding but extending the field life that these numbers can be revisited. And you can see on the screen that they have been. This year, unlike the last year, we've managed to actually reduce it not just by extending the field life, i.e., the discount rate, but actually reducing the cost themselves, the engineering cost themselves. So we end up this year with an IRR of around $84 million, a 35% reduction from last year and indeed a 54% reduction from the day when we closed the transaction. I think what Sean has mentioned earlier on in terms of the transformation and ongoing activities that we've been doing over the last couple of years and how does this translate in terms of like the performance of the business, but most importantly, and often something that we don't really discuss much, but in terms of the status of the balance sheet. And what you see here in front of you is really just a description of the total assets and total liabilities and shareholder equities over the last couple of years, starting from 2022 and then how the acquisition of Mubadala has transformed the business in terms of the size. But I think what I would like to draw your attention is really what have we done in 2004 to strengthen that balance sheet. And as you can see that in terms of the book value, we were up 86%. And that, again, it's a reflection of operating -- delivering on operations. And at the same time, and I've just flagged it on the previous slide is that reduction in the liability there. So from our side, what we are seeing here is not only an increase in terms of shareholders' equity, but fundamental decrease in terms of the liabilities. And at the same time, on the asset side, you see that not only do we take more cash out of the business, i.e., we're building the cash, but even our asset base is growing. And that's on the back of just extending the field life, adding more reserves and obviously, the tax consolidation has helped as well here. So with the balance sheet in the shape, it gets us very comfortable in terms of being able to pursue the organic and inorganic opportunities that we see. But at the same time, it gives us that flexibility as well that we need, especially as an E&P company. So how does this kind of play out in terms of the guidance for 2025? And look, these guidance have not changed in terms of what we presented earlier on when we released this guidance. So again, in terms of the productions and adjusted OpEx and adjusted CapEx, it's worth highlighting that these numbers exclude any Wassana FID. And I think once we -- and Greg can talk a little bit about it later. But the idea is that like once FID is taken that these numbers will be adjusted. A reminder for everyone that like when we talk about adjusted OpEx, and it's something that we flagged during the Capital Market Day, but worth highlighting it again, our expectation is that we end up the year per barrel. But critically, our OpEx do include leases, which for other companies, they are actually excluded and put it elsewhere in their balance sheet. But for us, it's really a true reflection of the actual cash cost of producing those barrels. And on the exploration side, we obviously flagged earlier on that we're going to be looking at Ratree prospect from Jasmine and also additional exploration that potentially could be Nong Yao D to follow up on that. Now if you plug all of these numbers into a simple model, as you can see, our really cash return to be quite simple to follow and you assume an oil price of between $65 and $85, our expectation is that on a free cash flow perspective, post-tax, post CapEx, post SRBs, post OpEx of a range of $112 to $227. I think, I guess with that, I'll pass on to Greg.

Thank you, Yacine, and hello, everyone. So let me just share a few of the highlights for our activity plans for '25. So I think, first of all, there's a lot of activity in our organic portfolio. We are working towards a big milestone, which is the Wassana redevelopment FID. We've said earlier, we are planning to take that FID around early Q2. That's still our plan, and I will say a bit more about this in a moment. Now we talked many times about how ongoing infill drilling is key to our reserves replacement. And so this year, we are also going to be drilling throughout the full year with our contracted rig. We've recently finished the drilling campaign on Manora. The rig is currently in the Jasmine field drilling more infill wells. Around the middle of the year, the rig will go to Nong Yao with around nine development wells done there. And then it will be back to Jasmine in Q4. Now in that campaign, we've got a couple of exploration wells. Most importantly, we are planning to drill the Ratree prospect in the Jasmine license towards the end of Q2. And we are also having a potential follow-up to Nong Yao D notionally planned for Q4 of this year. Now a couple of other projects I would highlight. The low-BTU generator in Jasmine has just been installed in early March. We are now going through the process of hookup and commissioning of that machine. And so we expect in Q2 to start getting the benefit of it, which is using waste gas for power generation to reduce our OpEx and also reduce our greenhouse gas emissions. In parallel, we are working on the debottlenecking project in Manora, which should come on stream around middle of the year. In parallel to all of the busy organic activity, we are also working on inorganic opportunities. Now let me then say a bit more about Wassana FID. Okay. So first of all, I think you will recall that our reserves on Wassana at year-end '24 are 12.9 million barrels. And that's already a very significant growth since we have taken over the field from the KrisEnergy acquisition. Now that volume of reserves is based on a conservative notional development concept of basically replacing the current MOPU, which is in the field. Now on that graph on the right, you see a sort of gray circle in the middle, which shows the reach of the wells that allow us to access only a portion of the main field in Wassana from the [ MOP ], and so the concept and given the success we've had in exploration with deeper horizons, the success we've had with exploration drilling in '24 with the wells we drilled in the northern Wassana and Niramai, there is a lot more volume in the field that we could recover even by replacing the old model. And so the concept we are working on is a platform, which will be located more or less in the center of the main field. And you see with the red circle that we can recover a lot more volumes just from the main section of the field, right? And that's why we expect that when we take FID Wassana development, we should see immediately a significant increase to the 2P reserves, right? So you may recall that in our 2C volumes of Wassana, there is around 12-plus million barrels. We do expect a significant proportion of the 2C volume to be converted to 2P reserves at [indiscernible]. Now I think the way we look at overall development of Wassana is really by analogy with Nong Yao. Nong Yao is our most valuable field and is also the field with the lowest unit OpEx. So in Q4, the OpEx per barrel was significantly lower than the portfolio average, which Yacine talked about of $32.8 per barrel. And so we expect a similar story with Wassana, where we take an FID on an initial host facility which is the first phase of the project. And then this provides a basis just like it did with Nong Yao for additional satellite developments where we already have discovered volumes in the north of the license work and also in the south, right? And with -- that allows relatively low-cost satellite facilities to be connected to the main field. Now in terms of the key value levers for the development, we would expect to more than double current production from Wassana just on that main facility coming on stream. And we see this project as very economically attractive just for the initial development. But bringing in satellites would extend the plateau for a number of years and would add a lot more value to the overall license development. So in terms of the time line, I mean, as I said, we are now finished the design, working through the contracting process, and we expected FID early in Q2. And then first oil would come early or, say, Q2 2027. So basically 2 years more or less from FID. Now with this, let me hand over back to Sean. Thanks, Greg. And just to touch on the last slide, and we talked about at the beginning of really the increase in NAV that we've generated through these assets, through the assets that we acquired. So with the cash position we've generated over the past couple of years, add on that reserves value where you end up at about $1 billion value. But what we've seen over the past couple of years is that continual addition onto that NAV, onto the core assets to build up the value of these assets. If we look back a couple of years, what we were about on an asset value, we were about [ 4.17 ]. We were able to almost double that as we went to year-end '23, and we've seen almost doubling that again. So while we feel the share price is at a discount to that, the share price is really just chasing that NAV as we move up. And we really want to emphasize to people that we still see more value in these assets. We have good projects and good drilling that is going on now that we see pushing that up even higher. So it's been an extremely exciting couple of years in '23 and '24. Earnings per share actually in both years of over $2. But now we look ahead at 2025, it's going to be another exciting year as we move through that. So with that, I'll hand back over to Robin, and thank you very much for all joining us here.

Thanks, Sean. Just give us a moment to get organized here for Q&A. [Operator Instructions] In the meantime, we've had a few questions come in by e-mail. And maybe I'll address those first. First question, finance-related one. You lifted a lot of oil in Q4 more than your production. How does that affect your expectations for Q1 2025?

Thank you, Robin. Good question. I guess I think it's worth reminding everyone that as an offshore producer, there's often this mismatch between production and your lifting. I mean ultimately, every barrel will get sold, but sometimes there is a mismatch between the two -- between what we record during the quarter. So as you said, during the last quarter in Q4, we've lifted more than we have produced, and that has allowed us to effectively lower our inventory. And that was really driven by timing of the liftings. I mean this is a live business. So operationally, we don't really -- we can't always match the -- or as we meet the quarterly dates. So I think for Q1, our expectation is that like we're probably going to build a little bit of inventory. If I look at the lifting schedule for this quarter and what's coming up this evening for this week. It's likely that we're going to build a little bit of inventory. So effectively, that means that we're going to be lift less than we produce. And then, again, looking at that schedule, a lot of these lifting will get done and we'll probably revert back to normal, what we see as normal inventory a couple of weeks after the end of the quarter anyway.

Thanks, Yacine. We'll take a couple of live questions now. First one, we'll go to Charlie Sharp.

Thanks very much for the presentation. Excellent job. It's really just a question regarding the mature fields, excluding Wassana. And obviously, you've got a terrific track record so far of increasing reserves and extending field life. That's terrific. And you point to potential for further increases. I know it's a bit of a crystal ball question, but how much longer given the maturity of those producing assets, as I say, aside from Wassana, how much longer can you see that sort of progression in reserves and life extension continuing for another 1 or 2 years or even more than that?

Look, Charlie, Greg here. Thanks for the question. I think as we have discussed during our Capital Market Day, the nature of the geology and the portfolio is such that continued drilling gives us ongoing additions of volumes, right? So we do infill drilling by bringing new wells on stream, and we continue to do appraisal objectives whilst we are drilling development wells as well, right? We have seen over 200% reserves addition 2 years in a row. And we don't think it's the end of the story, right? So we do expect this to continue, but I would be a little bit careful with giving you numbers for the coming years, right? But it's not the end of the -- there's a lot more in the portfolio. And I would point you to also just 48 million of 2C resources that we currently have, right? And during '24, we added more 2P reserves than we had 2C volumes at the beginning of the year. So these are just a couple of the points I would say.

Yes, Charlie, it's Sean. I'll maybe just add on to that, too, because if you look at the number of locations, drill locations in our reserves, I think it's over 100 locations now. So we really expect that in the drilling of those wells, you also continue to add more with every well that you drill. And just a reminder to everyone that the reserves that NSAI report and the value associated with those reserves and the production profile, assume that we will not add a single other barrel. to these assets. But we know even with minor effort, you can do 100% reserve replacement every year. So there's still lots more upside there and lots more future.

Next question will come from David Round.

I was just asking about the transaction we saw in Thailand earlier this week. And just I suppose I was interested in whether that was something you looked at and if you did any reason why that maybe didn't fit for you guys?

Yes, a good question. Yes, it is one that we looked at. And in fact, we looked at it -- we're even looking at it by the time that we were doing these initial deals. That process has been ongoing for a significant amount of time, seem to go and then stop and then start up again and that -- so congratulations to the guys who've managed to get that closed and do that deal with Exxon. I know it was a challenging deal. But really, we looked at it in the very early stages. But once we got these deals done, no, it really -- it wasn't of interest in us, and we were not involved in that process.

Thanks for that. Change gears just a little bit. We've had a few questions come in very much along the same theme. I'll sort of batch a bunch of them together here. If we don't get your specific question, feel free to reach out afterwards, we'll try to capture what people are asking about. You've mentioned Turkey more than we've seen in the past. It's throughout your year-end disclosures, including even a mention in the press release. Is there something new happening in Turkey, realizing that we've also seen a transaction recently with Continental doing a joint venture in the region.

Yes. So a very good question because you're right, there was -- the blocks were very quiet for a while, while we waited actually for the government approval of the next exploration phase. We got that late last year. And then in actual fact, when we went back to the government to talk about a force majeure due to the delay, they were very accepting of that, and they quickly granted another 1-year extension. So the current exploration phase we're in on that block -- those blocks goes to the middle of 2026. And then given the discoveries we have there, we would then apply for what is a 2-year appraisal period on that to take us out to the middle of 2028. So we see that we've now got the time that we need in those blocks. And as Robin mentioned, with the exciting deal that was just recently done to bring Continental Resources into Turkey, there's good opportunity there. There are people who are starting to look at exploration again. There are companies that are starting to really expand internationally in unconventional. So that's an exciting deal. So yes, we'll follow up, hopefully, with some news in that area.

Okay. Very good. Next question, batch of questions here, actually, largely operational related. So this will be you, Greg. Last year, given the program efficiency that you've shown, you were able to squeeze out some additional wells beyond what you originally expected. Where are you on that this year? And should we expect that you're in line with the program ahead of the program? Any comment?

Yes. I'll say it's still early days. At the moment, we are on track. We are kind of on plan, but there's a lot more time to go, and we continue working with that continuous improvement mindset. So I do hope for, again, a little bit more efficiency as we work through the year.

Okay. Switching to Manora. Can you explain what the Manora debottlenecking project does to production once executed?

Yes. So, Manora, as many of our teams have a significant proportion of water production. That's the nature of this business. And so debottlenecking facility allows us to process more total liquids and thereby produce more oil. So we are increasing the capacity to just over 60,000 barrels total liquids, which should translate or which will translate into incremental oil production. Now I have to say that this debottlenecking is already embedded in our overall production guidance for the year. So it's incremental on the guidance.

Okay. And one more question from the same person, Stephane, you called by the way, asking these questions. The satellites north and south of the Wassana redevelopment, it is understanding -- sorry, let me read the question as it's ready. The satellites north and south of the Wassana redevelopment would not be part of the upcoming FID and reserve booking. Is that correct?

Yes, this is correct. So the satellites will be additional upside and that we will be then working to mature and take FID on in the not-too distant future following FID of the initial facility.

Okay. A couple -- just a couple more questions for the moment. [Operator Instructions] M&A, in the beginning, you had mentioned, Sean, that there was a long-term target of 100,000 BOED for the company's growth. Is this still a goal? And is it still achievable?

We do see that it is achievable in the region. There are the assets out there. There are the changes going on that can lead to this. And that's why we remain focused on really the larger type of assets. And it kind of ties with the question asked earlier was why were you not looking at the Exxon divestment. It wasn't material enough for us. It wasn't going to move the needle. We're trying to keep our focus on the larger assets. But we will also mention, again, I just want to make that point. You can set a target out there of a number of barrels. But really for us, it's still more about what is the cash flow that those barrels yield and then obviously, how that translates into value, your NAV and your share price. So that's really what's driving...

Okay. And another question is coming in. This one will be for Yacine. Tax-related question. Can you give us some color on forward timing of tax payments? And when does the tax consolidation benefits actually start kicking in for us?

Good question. Let's start first in terms of the benefits, and then we can talk a little bit about timing of the taxes. So the tax benefit, we already are -- we're already getting them now. We are already benefiting since we -- and I think that's kind of like highlighted in the PITA payment that we accrued in Q4. If you remember in the slide, we only accrued $1 million, which is really -- that is not related to any of the Thai III assets. Effectively, we're not paying any taxes on these. It's for something else. It Jasmine. So in terms of benefit, we're already starting benefiting. In Q4, we've already -- and I think I mentioned it earlier on, we already consumed effectively $32 million of those tax losses, thanks to that consolidation. Now in terms of timing, now I think we flagged it as well earlier on when we announced the consolidation. Usually, our tax payment occurs in Q2, and it's usually in April where we pay those taxes, that's PITA and SRB. However, because we did the consolidation in November, we had to -- we need to make the payment in Q1. So in Q1, we will be making tax payment, which otherwise would have been paid in April. So -- and just to give an example, in Q1, we would pay the equivalent of around $40 million to cover the SRB and the PITA for the various assets, Thai III assets up to November. Then there will be another payment, which reflects the period between November and year-end, which is December, and that will be in the usual timing, which is April. But yes, there will be a tax payment of around $40 million in Q1 related to the tax consolidation.

Okay. Thanks for that. Next question is with your large and growing cash position, do you have a plan to add a regular dividend?

It's a discussion we've had a lot, and it's a question we've had a lot, too. You know that last year, we implemented the share buyback program to start to return some of that capital to shareholders, and that's been our focus. We still believe that we need to be a larger size. We have more confidence in that cash flow to really get into a regular dividend-paying company. So that's one thing we'll kind of be discussing again with the Board as we move forward. But at the current size we're at, we didn't really see that a regular dividend is the way to go. We still need to get to be a larger size.

Okay. Another question on M&A. And I think this is our last question. So if you have anything that you'd like to ask, get that in now. Otherwise, this one is, given your strong cash flow and your net cash position, what type of portfolio expansion best fits with the current strategy? Is your preference to lean more toward a large development asset? Or are you still looking exclusively at things that are cash flow accretive?

Yes, a good question. Our preference would always be things that are really cash flow accretive. But as we've kind of mentioned before, we would do a development opportunity. So you're looking at that kind of delay in cash flow. But if you can get the right opportunity at the right price, then it's really what's the cash flow in the near term, how fast would that development opportunity pay back to then start yielding those much stronger cash flows that you get from that new development coming on. If we do kind of look as we have our assets, which are really delivering very good cash flow, and we're pushing them out to extend that cash flow further. But you're looking for things that you want to be coming on at some point in time that you can start to grow that production, grow that cash flow. But we do have the cash flow now that's supercharged to really underpin the development activity.

Great. Okay. We've had no further questions come in. So I'll just remind the audience that if there is anything that you'd like to go into more detail, feel free to reach out to us. Our website addresses and contact information are at the back of this pack and also available on our website. So over to you to wrap up, Sean.

Yes. Just again, I'll reiterate kind of what we talked about at the beginning. Thank you, everyone, for joining us and supporting us on this journey. It has been an extremely exciting time. We're very pleased with how the assets have worked out. And what I can also say is really a hats off to the team that we have in Thailand. We showed how we had -- we managed to achieve our guidance in production last year. We achieved our guidance on OpEx. But it wasn't without the challenges. When we look at production, we know that Wassana was down for about 5 weeks. That cuts into your production. Nong Yao was a key development that was delayed several months. And in actual fact, the team really knowing the portfolio they had, we were able to adapt the portfolio, adapt the drilling to fill those gaps that were being created there. So as we've moved now, we're in our second year of operating with the team in Thailand. They're extremely good, and they've really worked out very well for us. We see lots of opportunities to really leverage the strength of the team as we look to develop further in the region and the country. Thank you very much, everyone, for joining us, and let's see how 2025 goes. It's going to be exciting. Thank you.