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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 6-K
REPORT OF FOREIGN ISSUER
PURSUANT TO RULE 13a-16 OR 1d-16
OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE MONTH OF NOVEMBER 1998
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PETSEC ENERGY LTD
Level 13, 1 Alfred Street
Sydney, NSW 2000
Australia
[Indicate by check mark whether the registrant files or will file annual
reports under cover of Form 20-F or Form 40-F]
Form 20-F _X_ Form 40-F ___
[Indicate by check mark whether the registrant by furnishing the information
contained in this Form is also thereby furnishing the information to the
Commission pursuant to Rule 12g3-2(b)
under the Securities Exchange Act of 1934.]
Yes ___ No _X_
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PETSEC ENERGY LTD
(A.C.N. 000 602 700)
12 November 1998
PETSEC ENERGY ANNOUNCES THIRD QUARTER RESULTS
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Sydney, Australia - Petsec Energy Ltd (ASX: PSA and NYSE: PSJ), an independent
oil and gas exploration and production company with its operations offshore Gulf
of Mexico, USA, today reported its results of operations for the three months
ended 30 September 1998.
RESULTS
Under Australian accounting standards, Petsec recorded a profit before interest,
tax and abnormal items for the three months of A$3.5 million (1997: A$10.6
million). After interest, tax and abnormal items, the loss was A$2.7 million
(1997: a profit of A$0.5 million).
Under US generally accepted accounting principles, Petsec reported a net loss of
US$2.6 million for the three months ended 30 September 1998. Basic and diluted
earnings per ADR were a loss of US$0.12. In the three months ended 30 September
1997 there was a net loss of US$1.5 million (US$0.07 per ADR).
Net sales of US$20.6 million were affected by falls in both prices and
production. Both oil and gas prices were lower than a year ago (11% down) and
the previous quarter (5% down), while the 8% fall in production from the June
quarter reflected the impact of hurricanes and tropical storms which occurred in
this year's September quarter.
Despite the lower production, overall costs before exploration on a per Mcfe
basis were slightly better than in the June 1998 quarter and only 4% higher than
a year ago.
Earnings before interest, tax, depletion and exploration costs for the three
months reduced to US$14.9 million from US$27.0 million in 1997, with cash flow
from operating activities showing a fall to US$15.0 million from US$22.1
million.
Dry hole costs of US$2.2 million relating to the Main Pass 91 East #1 well were
expensed in the September quarter and a further US$0.2 million incurred on the
well will be expensed in the December quarter.
For the nine months ended 30 September 1998, sales of US$72.2 million were 22%
lower than in 1997, with 10% due to lower production and 13% due to lower
commodity prices. The net loss for the nine months of US$23.8 million reflected
the dry hole and impairment costs of US$36.2 million (before tax). In the
comparable period in 1997 there was a net income of US$7.1 million.
A summary of the unaudited financial results for the three months ended 30
September 1998 is attached.
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Level 13, Gold Fields House, 1 Alfred Street, Sydney NSW 2000 Australia
PO Box R204, Royal Exchange NSW 1225 Australia
Telephone (61)(2) 9247 4605 Facsimile (61)(2) 9251 2410
Company information is available on http://www.petsec.com
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Petsec Energy's Managing Director, Terry Fern, said: "Our results this year have
been impacted by a weak commodity price environment and a number of unsuccessful
wells. We had hoped that exploration success this year would have balanced a
weak commodity environment. While our results are disappointing in view of our
previous good exploration record, some dry holes are to be expected in this
business."
For further information please contact:
In Australia: In USA:
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Terry Fern, Managing Director, or Ross Keogh, VP Finance and
Robin Cumming, Chief Financial Officer Administration,
Petsec Energy Ltd Petsec Energy Inc
(61) 2 9247 4605 (phone) (318) 989 1942 (phone)
(61) 2 9251 2410 (fax) (318) 989 7271 (fax)
Level 13, Gold Fields House 143 Ridgeway Drive, Suite 113
1 Alfred Street, Sydney, NSW 2000 Lafayette Louisiana, 70503-3402
Company information is available at Petsec's web site http://www.petsec.com
1 Information in this report which relates to hydrocarbon reserves is based on
information compiled by a person qualified in accordance with Listing Rule 5.11
and accurately reflects the information compiled by that person.
2 Certain statements in this report regarding future expectations and plans of
the Company may be regarded as "forward-looking statements" within the meaning
of Section 27A of the USA Securities Act of 1933 and Section 21E of the USA
Securities Exchange Act of 1934. Although the Company believes that its
expectations and plans are based upon reasonable assumptions, it can give no
assurance that its goals will be met. Actual results may vary significantly from
those anticipated due to many factors, including oil and gas prices, operating
hazards, drilling risks, environmental risks and uncertainties in interpreting
engineering and other data relating to oil and gas reservoirs, as well as other
risks discussed in the Company's SEC filings.
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Level 13, Gold Fields House, 1 Alfred Street, Sydney NSW 2000 Australia
PO Box R204, Royal Exchange NSW 1225 Australia
Telephone (61)(2) 9247 4605 Facsimile (61)(2) 9251 2410
Company information is available on http://www.petsec.com
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PETSEC ENERGY LTD
RESULTS FOR THE THIRD QUARTER ENDED 30 SEPTEMBER 1998
(A$, AUSTRALIAN ACCOUNTING STANDARDS, UNAUDITED)
<TABLE>
<CAPTION>
Three months ended Change Nine months ended Change
30 Sep 98 30 Sep 97 % 30 Sep 98 30 Sep 97 %
(in thousands) (in thousands)
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<S> <C> <C> <C> <C> <C> <C>
OIL AND GAS SALES (BEFORE DEDUCTING ROYALTIES) A$ 41,807 55,004 -24% 138,982 150,464 -8%
PROFIT AND LOSS ACCOUNT
Profit before interest and abnormal item A$ 3,519 10,611 -67% 13,653 33,185 -59%
Net interest expense (3,968) (2,627) (8,339) (4,483)
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Operating profit (loss) before abnormal items (449) 7,984 5,314 28,702
Abnormal items (dry hole costs and impairment) (3,664) (7,069) (57,132) (7,069)
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Operating profit (loss) before tax (4,113) 915 (51,818) 21,633
Tax benefit (expense) 1,457 (434) 18,064 (7,193)
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OPERATING PROFIT (LOSS) AFTER TAX (2,656) 481 (33,754) 14,440
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BASIC AND DILUTED EARNINGS PER SHARE A$ (0.02) 0.00 (0.31) 0.13
NUMBER OF SHARES OUTSTANDING (PERIOD END, THOUSANDS) 107,601 107,601 107,601 107,601
NUMBER OF SHARES OUTSTANDING (AVERAGE, THOUSANDS) 107,601 107,568 107,601 107,226
AVERAGE US$ / A$ EXCHANGE RATES 0.5919 0.7325 0.6324 0.7561
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</TABLE>
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PETSEC ENERGY LTD
RESULTS FOR THE THIRD QUARTER ENDED SEPTEMBER 30, 1998
(US$, "SUCCESSFUL EFFORTS" ACCOUNTING UNDER US GENERALLY ACCEPTED
ACCOUNTING PRINCIPLES, UNAUDITED)
<TABLE>
<CAPTION>
Three months ended Change Nine months ended Change
September 30 September
1998 1997 % 1998 1997 %
(in thousands) (in thousands)
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<S> <C> <C> <C> <C> <C> <C>
STATEMENT OF OPERATIONS
Oil and gas sales (net of royalties) US$ 20,589 32,668 -37% 72,171 91,970 -22%
Lease operating expenses (3,142) (2,903) (10,956) (7,666)
General, administrative and other expenses (2,364) (2,353) (6,964) (6,407)
Stock compensation expense (167) (444) (796) (1,266)
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EBITDAX (income before interest, DD&A, exploration,
dry hole costs) 14,916 26,968 -45% 53,455 76,631 -30%
Depletion, depreciation & amortisation (DD&A) (12,709) (19,112) (41,654) (48,552)
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INCOME FROM OPERATIONS (before exploration &
dry hole costs) 2,207 7,856 11,801 28,079
Exploration expenditures (1,645) (2,784) (6,515) (5,213)
Dry hole and impairment expense (2,169) (5,352) (36,225) (7,611)
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INCOME (LOSS) FROM OPERATIONS (1,607) (280) (30,939) 15,255
Profit on sale of assets and other income 12 25 (67) 53
Interest expense (net of interest income) (2,375) (1,896) (5,092) (3,195)
Equity in income (loss) of affiliates - 28 - (1,646)
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Income (loss) before tax (3,970) (2,123) (36,098) 10,467
Income tax benefit (expense) 1,371 596 12,261 (3,411)
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NET INCOME (LOSS) US$ (2,599) (1,527) (23,837) 7,056
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CASH FLOW DATA
Net cash provided by operating activities US$ 15,002 22,141 -32% 51,487 68,796 -25%
Net cash used in investing activities US$ (47,184) (39,838) (123,021) (110,316)
Net cash provided by financing activities US$ 31,011 1,367 66,011 61,514
BALANCE SHEET DATA (AT END OF PERIOD)
Total assets US$ 271,592 245,974 271,592 245,974
Cash and deposits US$ 13,648 32,522 13,648 32,522
Borrowings US$ 165,649 99,624 165,649 99,624
Shareholders' equity US$ 76,899 101,214 76,899 101,214
BASIC AND DILUTED EARNINGS PER SHARE
Net income per ordinary share US$ (0.02) (0.01) (0.22) 0.07
Net income per ADR US$ (0.12) (0.07) (1.11) 0.33
Average number of shares outstanding (thousands) 107,601 107,568 107,601 107,226
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ADDITIONAL DATA
NET PRODUCTION
Oil (MBbls) 549 775 -29% 1,769 2,324 -24%
Gas (MMcf) 5,802 8,134 -29% 20,056 20,218 -1%
Total (MMcfe) 9,096 12,784 -29% 30,670 34,162 -10%
NET SALES
Oil (US$ in thousands) US$ 8,591 14,459 28,508 45,769
Gas (US$ in thousands) 11,998 18,209 43,663 46,201
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Total (US$ in thousands) 20,589 32,668 -37% 72,171 91,970 -22%
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AVERAGE SALES PRICE
Oil (US$ per Bbl) US$ 15.65 18.66 -16% 16.12 19.69 -18%
Gas (US$ per Mcf) 2.07 2.24 -8% 2.18 2.29 -5%
Total (US$ per Mcfe) 2.26 2.56 -11% 2.35 2.69 -13%
AVERAGE COSTS (US$ PER MCFE)
Lease operating expenses US$ 0.35 0.23 0.36 0.22
Depletion, depreciation and amortisation 1.40 1.49 1.36 1.42
General, administrative & other expenses 0.26 0.18 0.23 0.19
Stock compensation expense 0.02 0.03 0.03 0.04
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Total (before exploration and dry hole costs) 2.02 1.94 +4% 1.97 1.87 +5%
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</TABLE>
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
PETSEC ENERGY LTD
Date 12 November, 1998 By /s/ ROBIN A CUMMING
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Robin A Cumming
Chief Financial Officer
