Trading Symbol: NWX (TSX-V)
VANCOUVER, Aug. 12, 2020 /CNW/ - Newport Exploration Ltd
("Newport" or "the Company") is pleased to announce its third
quarterly cash dividend ("the Dividend") of $0.01 per share to its shareholders of record at
the close of business on August
26th, 2020. The Dividend payment date is
September 10th, 2020.
The Dividend, fully approved by the Board of Directors, is not
subject to any changes and has been designated as an "eligible
dividend" for Canadian income tax purposes.
The COVID-19 pandemic exacerbated the ill-timed oil price war in
early 2020 that resulted in the biggest drop in oil demand, as well
as the biggest oil price drop, on record. This resulted in several
producers shutting in wells, delaying projects and slashing
investment in exploration and development. Global investment in
future supply has collapsed, and returns for many producers have
fallen below the cost of capital. Meanwhile, as reported in a
Company News Release dated July
22nd, 2020, Beach continue to achieve exploration
success (particularly on oil fields on ex PEL 91), and with their
very low production costs, have achieved both reserve replacement
and positive cash flow.
Management believes that based on Beach Energy Ltd.'s ("Beach")
FY2020 Fourth Quarter Activities Report (dated 22nd
July, 2020), recent exploration success and development of the
licenses in the Cooper Basin over which the Company has its 2.5%
Gross Overriding Royalty ("GOR"), shareholders should continue to
be rewarded with dividend continuity. The move from an annual
dividend to a quarterly dividend in 2020 has proved to be the right
step as it has provided the Company with the flexibility to
maintain its financial position during a very difficult period,
while at the same time paying the full quarterly dividend as
proposed, despite the exceptional level of uncertainty that still
prevails.
The Company's strong balance sheet ensures that it has the
ability to maintain regular quarterly dividend payments and
possibly increase them in the future without taking on any debt or
undertaking any equity financing.
Guidance
As stated previously by the Company (News Release dated
July 22nd, 2020), it is
material information for shareholders of Newport that Beach report that revenues from
their gas sales cover their group operating and stay-in-business
costs and that their reported break-even oil price is less than
US$0/bbl. Also reported in the same
Company News Release, Beach report that their crude sells at a
material premium to Brent.
Newport has no control over
operating decisions by Beach. Accordingly, this prevents the
Company from commenting on Beach's current financial status and/or
operating plans going forward. As always, the Company continues to
strongly recommend that shareholders and potential investors access
material information relevant to the Company as released
independently by Beach. This recommendation is particularly
relevant with regard to the current uncertainty in the global oil
markets.
The Company receives its gross overriding royalty from Beach,
which is not a reporting issuer in Canada, therefore Newport is not able to confirm if the
disclosure satisfies the requirements of NI 51-101 - Standards of
Disclosure for Oil and Gas Activities, or other requirements of
Canadian securities legislation.
About Newport
Newport holds a 2.5% GOR on
several oil and gas licences and permits in the Cooper Basin in
Australia. These permits are
currently being operated and explored by Beach and Santos Ltd.
("Santos"), both major Australian oil and gas producers.
The Company continues to strongly encourage shareholders and
potential investors to access information released independently by
Beach and Santos in order to keep current during exploration,
development and potential production of all the licences subject to
the Company's GOR. Investors are cautioned that historical results
are no guarantee of future results.
The Company currently has 104,429,874 common shares issued and
outstanding and $6.7 million in the
Treasury (comprised of cash, cash equivalents and investments), and
no debt. The Company expects to receive the next royalty payment
prior to the payment of the third quarterly dividend.
Neither the TSX Venture Exchange nor its Regulation Services
Provider (as that term is defined in the policies of the TSX
Venture Exchange) accepts responsibility for the accuracy or
adequacy of this news release.
Cautionary Statement on Forward-Looking Information
This news release is intended to provide readers with a
reasonable basis for assessing the future performance of the
Company. The words "believe", "should", "could", "expect",
"anticipate", "contemplate", "target", "plan", "intends",
"continue", "budget", "estimate", "may", "will", "schedule" and
similar expressions identify forward-looking statements.
Forward-looking statements may pertain to assumptions regarding the
price of oil and fluctuations in currency markets (specifically the
Australian dollar) and future dividend payments. Forward-looking
statements are based upon a number of estimates and assumptions
that, which are considered reasonable by the Company, are
inherently subject to business, economic and competitive
uncertainties and contingencies. Factors include, but are not
limited to, the risk of fluctuations in the assumed prices of oil,
the risk of changes in government legislation including the risk of
obtaining necessary licences and permits, taxation, controls,
regulations and political or economic developments in Canada, Australia or other countries in which the
Company carries or may carry on business in the future, risks
associated with developmental activities, the speculative nature of
exploration and development, and assumed quantities or grades of
reserves. Readers are cautioned that forward-looking statements are
not guarantees of future performance. There can be no assurance
that such statements will prove to be accurate and actual results
and future events could differ materially from those acknowledged
in such statements.
The Company disclaims any intention or obligation to update or
revise any forward-looking statements whether as a result of new
information, future events or otherwise, except to the extent
required by applicable laws.
© 2020 Newport Exploration Ltd.
SOURCE Newport Exploration Ltd.