Cue oil profit increases by 150 per cent

Production from the Maari oil field has pushed Cue Energy's half-year profit to A$8.4 million ($12 million), an increase of 150 per cent from the previous corresponding period.

Revenue increased 72 per cent to A$30.9 million in the six months to December 31.

Australia-based Cue Energy is 27 per cent owned by Todd Energy.

The company's chairman, Richard Tweedie, said the increase could be attributed mainly to revenue of $28.51 million from increased oil production from the offshore Maari field in Taranaki.

Gas production at Oyong in the Sampang PSC, Indonesia, also contributed.

Cue's share of oil production from the Maari field was 200,815 barrels for the half-year. Overall, Cue production increased from 148,479 barrels to 334,434 barrels.

In the same period, Cue completed development drilling on the Maari field and the shallower M2A oil development well was successfully drilled and completed.

Oil production had now commenced from the M2A appraisal-development well, MR9, on the Maari field and flow testing would continue for several days, said Tweedie, whois also Todd Energy's managing director.

The M2A zone is estimated to contain up to 33.6 million barrels ofoil.

The Manaia-1 oil appraisal well was also successfully drilled from the Maari platform to a measured depth of 7945m, a New Zealand record.

The two wells increased Cue's proved and probable oil reserves by 475,000 barrels, Tweedie said.

The Maari field covers about 34sq km of the offshore Taranaki Basin.

Drilling of the Maari-1 exploration well began in 1998, commercial production began in the last quarter of 2008 and production of a light crude oil started in February 2009.

In Western Australia Cue holds an interest in a large gas prospect, Caterina, in the Carnarvon Basin. Cue believes Caterina has gas in place of 11 trillion cubic feet which would be sufficient for a large LNG development.

Cue has begun a farm-out campaign for the permit with significant interest from a number of large international oil companies.

Cue shares closed unchanged at 28c yesterday.