Conrad Asia Energy (CRD) H2 2024 earnings summary

Executive summary

• 2024 was marked by significant regulatory changes in Indonesia, impacting gas sales agreements and project timelines, but ultimately providing greater fiscal clarity and improved terms for domestic gas sales.

• The company advanced negotiations for a new Gas Sales Agreement (GSA) with PLN, following the revocation of previous export contracts, and expects to finalize this soon, underpinning the Mako project's value.

• Progress continued on the Aceh PSCs, with substantial contingent and prospective gas resources identified, and a Memorandum of Understanding (MOU) signed with PGN to explore small-scale LNG commercialization.

• The company maintained a strong safety record, completed key environmental approvals, and continued to optimize project costs and schedules for the Mako development.

Financial highlights

• Consolidated net loss after tax for 2024 was US$7.6 million, an improvement from US$9.7 million in 2023, driven by a 22% reduction in operating expenditure to US$7.7 million.

• Net operating cash flows were US$9.04 million, relatively steady year-over-year after adjustments for non-cash items.

• Capitalized exploration and evaluation costs decreased to US$1.4 million as projects matured, while labor costs increased by 23% to US$4.58 million due to transition to development phase.

• US$10.34 million was raised through issued capital for working capital needs.

Outlook and guidance

• Finalization of the PLN GSA is expected in the coming months, enabling a Final Investment Decision (FID) for the Mako project and advancing farm-down and financing arrangements.

• The company anticipates advancing commercialization options for the Aceh fields, including small-scale LNG, and plans to acquire up to 500 sq km of 3D seismic data in 2025.

• Macro conditions in Asia remain supportive for natural gas as a transition fuel, with Indonesia aiming to double gas production by 2030.