RH Petrogas - UOB Kay Hian 2024-08-21: Strong 1H24 Results Due To Solid Cost Control & Higher Oil Prices

• Due to steady y-o-y oil production, strong cost control (-17% y-o-y) and higher oil prices, RHP reported a threefold increase in PATMI to US$7.3m, in line with our expectations.
• During 4Q24, RHP’s Basin PSC will see decent activity with the drilling of one well at the Arar Block, and the start of production from its new Piarawi well.

In-line 1H24 results.

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• At RHP’s results briefing yesterday, management stated that it remains on track to drill one well in 4Q24, with a potential target of around 2mmbbl of recoverable oil reserves. This could add around 7% to its 2P reserves of 30.1mmboe, by our estimates.

Good cost control.

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• Coupled with a 61% decline in depreciation, depletion & amortisation, RHP witnessed a 62% increase in EBITDA to US$9.3m.
• We also highlight that management of RHP will be optimising its workforce from the Island Production Sharing Contract (PSC) to the Basin PSC, thus potentially increasing its level of cost savings over the next 2-3 years.

Update on Piarawi-1 well.

• Read more at SGinvestors.io.

Adrian LOH UOB Kay Hian Research | https://research.uobkayhian.com/ 2024-08-21 SGinvestors.io

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