Touchstone Exploration Share Discussion Threads

[joey1998] 15/11/2023 20:29

Anyone see the presentation today?

[11_percent] 15/11/2023 10:30

It is free......just register.






Q3 results and ops update

Touchstone’s Q3 results and ops update provide early evidence of the transformational potential of the Cascadura field. This field only came on stream late in the quarter and commissioning activity is still being finalised, but it still drove record quarterly volumes and higher revenue, netbacks and cash flow. In October, despite being choked back, Cascadura production alone was more than double Touchstone’s Q3 total output, with more still to come from facility optimisation and additional development drilling. We are leaving our FY23 estimates unchanged, with slightly lower production offset by higher NGL realisations and oil prices. Our risked NAV-based price target also remains unchanged at 87p/sh.

- Cascadura boosts Q3 results…Touchstone’s results release and operational update start to demonstrate the potential of its Cascadura field. This only came on stream towards the end of the quarter but still helped deliver record quarterly production of 3,391 boepd, up 167% y-o-y, with Cascadura contributing almost half of that. It also drove higher revenues (+18% to US$11.7m) and operating netbacks (+37% to US$6.0m) despite a subdued performance from Touchstone’s legacy oil business, where production was down 7% y-o-y and realisations 15% lower. Coho-1 gas production also fell 12% y-o-y – an unsuccessful well workover will be recompleted this month to isolate a water producing zone.

…but really starts to show its potential in October... The October operational update gives a much better feel for Cascadura’s transformational potential, with production averaging 7,234 boepd (89% gas) and driving Group output to 8,917 boepd, over 2.5x the Q3 average. Even then, both Cascadura wells are currently being restricted while commissioning of the recycle compressor is finalised. Once operational, facility optimisation is expected to see production volumes move higher, with Touchstone targeting initial gross gas production of 60 mmcfd from the two wells versus October’s 48.4 mmcfd. October’s performance should reassure investors concerned about tight finances. Cash at the end of Q3 2023 stood at US$3.8m, down from US$10.4m at the end of Q2. However, following a full month’s production from Cascadura, this rose to US$5.4m at the end of October. Period-end debt also fell to US$29.5m from US$31m.

- …and will fund the next leg of growth. Cash flow from Cascadura in the coming months will replenish coffers and allow management to raise activity levels across the portfolio in pursuit of the next leg of growth. Further development drilling is planned on Cascadura and the CO-1 legacy oil block in Q1 2024, with rigs currently being certified. Critically, environmental permits are already in place to drill up to eight additional wells on Cascadura and two on Coho to fill facility capacities, eliminating the risk of regulatory delays. As a result, the next leg of Touchstone’s growth should be swifter, lower-risk and come with significantly lower capital intensity.

[eggchaser] 15/11/2023 08:20

And had the share price gone up you would have been happy??? For me the market is waiting for more and if the company can't provide because they are not in a position to do so then so be it.It's a solid honest update without any timeframes contained within that nearly always will always trips us up!

[peace1971] 14/11/2023 22:42

My simple math without diving into netback projections; just focussed on sales.
Total Sales =$11,682,000
Cascadura Sales = $3,135,000
Non Cascadura Sales = $8,547,000
October Cascadura Sales(my estimate from their #'s) = $4,858,000
Assuming stable production from all assets - Q4 total sales =$23,122,000
More than a double of current quarter. Cascadura only impacted a portion of the quarter.
Extrapolate that change across the quarter to expect the next quarter. The change in rate is the most important asset of this release.

[king suarez] 14/11/2023 16:40

Yes, their Finance team told me they would be receiving the same Brent discount for NGLs as for the legacy oil production. They achieved a higher average netback for NGLs than oil in the quarter, but that might have been due to the timing of when NGLs production started?

In the early days they were expecting a 25% discount to Brent, but the legacy oil seems to be discounted around 15% so it's better than initial forecasts.

[thommie] 14/11/2023 16:13

Ah, thx for correction. So it's just a coincidence that both numbers add up to the 60 mark.. :)

[king suarez] 14/11/2023 15:22

"The 9042 boe/d of gross production in october means that cascadura produced at 59,8 mmcf/d. So exactly what was said before."

Afraid that's not quite correct.

The actual gross production for October was 48.4 mmcf/d and was restricted due to a fault with a compressor(s) meaning they are having to curtail production a bit and flare off some excess gas. They haven't yet achieved first targetted average run rate of 60 mmcf/d.

9,042 is the total boe/d, which includes the 1,164 bbls/d of NLGs.

[chessman2] 14/11/2023 14:28

Hmm,

Like others I'm not too impressed by the RNS as the info has had a negative effect on the share price

Clearly the CEO has to pull up his socks even higher. More info would be better and perhaps a monthly report.

[pro_s2009] 14/11/2023 14:09

Was wrong KS as they said the service rig was at Royston.

As I said at the time......utter nonsense. Royston will be done year end, after Coho workover.

[spawny100] 14/11/2023 13:37

Market not impressed much with today's news; pretty much zero buying interest and sells look likely to push it lower yet.

[thommie] 14/11/2023 13:34

The 9042 boe/d of gross production in october means that cascadura produced at 59,8 mmcf/d. So exactly what was said before. The additional volumes that can be produced when the compressor is operational seem to be on top of the guidance. I dont have any clue how much that will be. Both cas wells being choked back at surface at least sounds like they could produce at higher rates. Didnt txp state 90mmcf/day as a target? Coho is unpleasant as usual. But I am glad to see the problem at coho and not at casca.... Im surprised to see that the NGL from casca are being priced the same like the rest of our oil production is priced at. I expected much lower prices! At least we can expect the further journey to be self funding from now on!

[buffythebuffoon] 14/11/2023 09:43

Go back and listen to the presentations from years ago. Cascadura is operational as is Coho. The great hope Royston? I’ve little idea about what’s going on there.

Maybe the cash is in the wall and we can’t have it. Who knows?

Maybe we’ll all die without seeing a tsunami of cash.

I can’t help feeling that the team that operates where the sun doesn’t shine isn’t the best.

Spangle, is it the cementing work that fails and is this avoidable? Or is there an element of unpredictability?

Buffy

[king suarez] 14/11/2023 09:14

Discord wasn't wrong on Coho, Pro? The first workover in October HAS failed - and requires a second go?

[eggchaser] 14/11/2023 08:28

As per other thread - that's how I read it?

[eggchaser] 14/11/2023 08:28

Yes that's how I read it... once that comes on line adds more to the coffers...

[awise355] 14/11/2023 08:15

What are you thoughts on the recycler, has the choke they mention been in place since day 1? And hasn't increased?

[pro_s2009] 14/11/2023 08:14

Overall......decent update. All ok....

Not going to make anyone buy and likewise will not make anyone sell.

Share price should amble along until we start the Cascadura C drilling in January.

[sleveen] 14/11/2023 08:03

How much incremental production can we expect from the recycle compressor?

Great October numbers with more to come following recycle compressor and Coho well packer completed.

[awise355] 14/11/2023 07:51

I think it's been non-operational since day 1 and is not an issue that sprung up in Nov.

[awise355] 14/11/2023 07:50

Almost 3x the total production in October compared to the 3 months q3

[awise355] 14/11/2023 07:49

Octobers production looked mega

[homebrewruss] 14/11/2023 07:48

Teething problems no?

[joey1998] 14/11/2023 07:46

Cas not at guidance, Coho worker failed so another attempt this month.
It continues.

[awise355] 14/11/2023 07:45

Do we take it the recycle compressor has been non-operational from day 1?

[awise355] 14/11/2023 07:21

Including Cascadura