Genesis Energy has revised its underlying earnings for FY24 because of lower-than-expected production levels at Kupe.
It said that work at Kupe KS-9 had concluded and was unable to produce sufficient flow to sustain operation of the well because of reservoir pressure level and liquid inflows. Genesis said that may result in a $15 million to $20m reduction in FY24 ebitdaf (earnings before interest, tax, depreciation, amortisation, fair value movements of financial instruments, investment costs, realisations and impairments) from previous guidance of about $430m.
As a result, FY25 financial planning was underway and would include an assessment of updated Kupe production levels and reserves.
Chief executive Malcolm Johns said gas production across New Zealand continued to decline faster than expected.
“As previously stated, less gas means more coal.”