Why the Beach Energy (ASX:BPT) share price is tumbling 5% lower today

This energy share is deep in the red on Wednesday…
The post Why the Beach Energy (ASX:BPT) share price is tumbling 5% lower today appeared first on The Motley Fool Australia. –

It has been a disappointing day so far for the Beach Energy Ltd (ASX: BPT) share price.

In morning trade, the energy producer’s shares are down 5% to $1.42.

Why is the Beach share price tumbling lower?

The catalyst for the weakness in the Beach share price on Wednesday has been the release of its quarterly report.

According to the release, Beach’s first quarter production was down 4% on the prior quarter to 5.7MMboe. This was driven largely by natural Western Flank oil decline, which was partially offset by increased nominations at Otway and the Cooper Basin joint venture.

Also potentially weighing on the Beach share price was its revenue for the quarter. Beach reported an 8% decline in sales revenue to $388 million despite an 11% increase in the realised oil price thanks to improving global product demand. This revenue decline was due to an 11% reduction in sales volumes to 5.76MMboe and a small decline in realised gas/ethane price.

Beach also revealed that its first quarter capital expenditure was $195 million, up 13% on the prior quarter. Management advised that its development, plant and equipment spend increased 14% as the offshore Otway drilling activities continued and increased drilling activity within the Cooper Basin joint venture and Western Flank.

Management commentary

Beach’s Managing Director, Matt Kay, acknowledged that production was softer during the quarter but remains positive on the future.

He said: “While production is slightly down for the quarter, we are in a phase where our focus is on executing our major growth gas projects. The Offshore Otway development drilling campaign now moves to the Thylacine targets, following successful results at Geographe 4 and 5. This is Beach’s largest ever drilling campaign and will be an important source of gas for the East Coast market.”

“A major milestone of the quarter was signing a HOA [heads of agreement] with bp for the sale of 3.75 MT of LNG from the Waitsia Stage 2 Gas Project – heralding our arrival into global LNG markets for the first time in our 60-year history. We also achieved first gas from the Kupe compression project, which means that asset, which is critical for New Zealand’s energy needs, will be able to maintain production at up to 77 TJ per day.”

“It is also exciting to commence an exploration campaign in the Western Flank, where we’ve already had two successful gas finds in this quarter – with an oil exploration campaign set for later in the year. This is to be followed by an uplift in production from first gas from the Geographe wells and the Cooper Basin development drilling in the second half of FY22,” he added.

The post Why the Beach Energy (ASX:BPT) share price is tumbling 5% lower today appeared first on The Motley Fool Australia.

Should you invest $1,000 in Beach right now?

Before you consider Beach, you’ll want to hear this.

Motley Fool Investing expert Scott Phillips just revealed what he believes are the 5 best stocks for investors to buy right now… and Beach wasn’t one of them.

The online investing service he’s run for nearly a decade, Motley Fool Share Advisor, has provided thousands of paying members with stock picks that have doubled, tripled or even more.* And right now, Scott thinks there are 5 stocks that are better buys.

*Returns as of August 16th 2021

More reading

5 things to watch on the ASX 200 on Wednesday

5 things to watch on the ASX 200 on Tuesday

These 3 ASX 200 shares are topping the volume charts this Monday

ASX 200 energy shares open higher as oil prices double in past 12 months

Here are the 3 heaviest traded ASX 200 shares this Wednesday so far

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

Trade The World Anywhere & Anytime!

Mobile app platform with over 50,000 global listed securities across 12 markets (over 70% global market capitalisation), right from your Android or iOS device.

Integrated with exclusive trading idea and investment analysis tools to help you find actionable insight on virtually every financial instrument across our 12 global markets, to help you optimise your trading strategies.

Refer Your Friends

Tell your friends about Monex and gift them FREE access to our trading tools.

We respect your privacy and will only send this one email notification to your friends. 

Share With Your Friends

Share on facebook
Share on twitter
Share on linkedin

Monex Trading Tools Access and Usage Terms

The Monex Trading Tools (referred to as ‘tools’ hereafter) are available to you inside your client portal;

To activate access to the tools, you must have a verified and approved trading account and have made a deposit of at least AUD $1000.

An active and funded account with a positive trading balance is required to continue to have access to the tools;

Although the tools are available to you indefinitely, Monex Securities may at it’s discretion disable access to the tools in the future;

Monex securities reserves the right to change these terms and conditions from time to time, as it sees fit, without notice.

Important Notice
iOS & Android App - 12 International Markets & Over 70% Global Market Cap. $0 Brokerage On US Trades. Click Here!