Tuesday 29th October 2013 |
Text too small? |
New Zealand Oil & Gas, which has interests in the Tui and Kupe fields, will lean on its cash reserves to maintain a "competitive dividend" as it ramps up exploration.
The company paid investors 6 cents per share in the last financial year, and expects its near $167 million cash reserves as at Sept. 30 will let it maintain that level of dividend while funding an annual spend of US$35 million on exploration, chief executive Andrew Knight told shareholders at today's annual meeting in Wellington.
"We have enough cash on hand to sustain a competitive dividend, at a gross yield of around 9 percent, at the same time that we are funding an increased exploration programme," Knight said in speech notes published on the NZX.
Earlier this month NZOG and Tui partners AWE and Pan Pacific Petroleum bought out Mitsui E&P's 35 percent stake in the Taranaki oil and gas field at what Edison International analyst John Kidd estimated was a discount of some 70 percent.
Chairman Peter Griffiths said the purchase was on "very attractive terms" which will "noticeably improve our income in future periods."
Knight told shareholders the company will try to focus on geological basins where it has particular expertise, and as it spreads its activity, it will include some prospects with greater investment risk and higher potential returns.
"The best examples are in deep water and new basins, and that's why we have returned to the Canterbury region," he said. "But we are not ready to operate deep water frontier wells, so we will continue to look for partners who can offer a level of exposure that's right for us."
The shares fell 1.8 percent to 82.5 cents at the open of trading today, and have slipped 4 percent this year.
BusinessDesk.co.nz
No comments yet
Second St John withdrawal of labour takes effect tomorrow with further strikes likely
Sanford Appoints Independent Director
CRP ADVISES CLOSURE OF SHARE OFFER TO EXISTING INVESTOR
Devon Funds Morning Note - 14 August 2024
OCR 5.25% - Monetary restraint tempered as inflation converges on target
Consumers still need due diligence as new deposit takers emerge.
Woolworths strike: staff asked to dress up in Disney costumes for a week on their own dollar
Turners Invests in Quashed Online Insurance Platform
PGW Reports on Challenging Year
Arvida Announces Executive Team Changes