SINGAPORE (Feb 27): Interra Resources reported earnings of US$1.3 million ($1.7 million) for FY17 compared to its FY16 loss of US$8.1 million, mainly due to lower share of losses from associated companies.
Revenue fell 26% in FY17 to US$11.2 million from US$15.2 million previously, which was largely attributable to the lower sales of shareable oil to 259,968 barrels compared to 506,236 barrels in FY16.
This comes despite the higher weighted average transacted oil prices of US$51.38 per barrel compared to US$39.03 per barrel the year before.
Meanwhile, the group’s shareable oil production for the full year fell 48% to 261,635 barrels from 504,979 barrels in FY16 in the absence of contribution from TMT TAC post its contract expiry in Dec 2016, as well as lower shareable production from Myanmar.
Cost of production however fell to U$5 million compared to US$9.6 million in FY16, in line with lower production expenses and shareable production, and further supported by lower production expenses incurred by LS TAC operations due to cost-cutting measures.
Higher other income of US$0.6 million was also registered over the year, compared to just US$0.1 million in FY16 due to a foreign exchange gain and fair value gain on investment properties.
Administrative expenses also fell to US$4.1 million from US$5.1 million previously due to the expiry of TMT TAC operations, and after adjusting for the accrual of withholding tax obligations.
Further to its contract extension, the group says field operations in Myanmar has resumed fully with gradually improving production levels.
See: Interra Resources commences drilling at Chauk development well
In response to the low oil prices in FY17, Interra says it has adopted an “extremely cautious approach” with its capital and operating expenditures.
The group adds that it intends to explore and evaluate various funding alternatives as it seeks to embark on an aggressive work program in Myanmar over the next few years, and to drill an exploration well in Kuala Pambuang at end-2018/2019.
Shares in Interra closed flat at 6.2 cents on Tuesday.
