ADX banking Vienna Basin oil revenues with BP contract

ADX has moved to secure strong revenues for its Vienna Basin oil production by hedging about 50% of its proved reserves through a new zero-cost contract with BP.

The hedging contract covers average production of about 115 barrels of oil per day from its Gaiselberg and Zistersdorf fields for a seven-month period and provides price certainty with a pricing floor of US$80 ($111.44) per barrel while providing exposure to upside through a US$130.25/bbl cap.

Brent crude benchmark prices are currently at US$121.72/bbl.

While the hedge will cover field operating and administrative costs, ADX Energy (ASX:ADX) retains exposure to any further upside in Brent pricing through the remaining 50% of forecast production that remains unhedged.

Gas production from the Vienna Basin fields, which is expected to contribute about 30% of field revenues during 2022, remains unhedged due to high gas prices in Europe that are currently in excess of US$150 per barrel of oil equivalent.

Continued strong oil and gas revenues from higher pricing and sustained production rates have placed the company in a strong position to continue a program of portfolio expansion for oil and gas as well as compatible green energy production opportunities.

 

 

 

This article was developed in collaboration with ADX Energy, a Stockhead advertiser at the time of publishing.

 

This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.

Related Topics

Explore more

Explore more

Investor Guide: Energy FY2025 featuring Peter Strachan

Read The Guide