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Oil price

Oil has rallied modestly today, after the shake-out yesterday it is to be expected but the fall was down to the announcement that talks are to be held on Friday as the Iranian Foreign Ministry said that it wanted a diplomatic solution.

Jadestone Energy

Jadestone has announced a trading update for the full year ended 31 December 2025. The financial information in this update is unaudited and may be subject to further review and change. 

The Group’s 2026 guidance will be announced with the end-2025 reserves update at the end of February 2026.

T. Mitch Little, Chief Executive Officer of Jadestone, commented:
“I’m pleased to report that 2025 was a strong year for Jadestone, underscored by a return to delivering on our annual commitments to our shareholders. Despite challenges encountered during the year, our operational and financial results are a testament to the skills and commitment of Jadestone’s dedicated staff, a diversified production base, and our renewed focus on operational excellence and financial discipline.

Even with the Sinphuhorm disposal during the year, average Group production reached another annual record of 19,829 boe/d, underpinned by better than expected performance at Akatara. Notwithstanding the higher production levels, total production costs were reduced by 14% from the prior year, as we took decisive actions to mitigate the cost increase of the Skua-11ST drilling campaign while improving cost discipline practices across the business. Despite significant capital investment, our year-end net debt declined 15% year-on-year as we sought to build resilience to lower near-term oil prices.

And I am very proud to say that the strong operating and financial results were delivered while we extended our impressive HSE performance, achieving a significant milestone of over 12 million manhours worked without a lost-time injury.

In recent months, we have achieved key milestones in the approval of the field development plan for the Nam Du/U Minh discoveries offshore Vietnam. We are increasingly optimistic that we will have further good news to share on this key growth project in the near-term. An infill drilling campaign offshore Malaysia will also commence in coming months, as we seek to follow up on the successful 2023 program on the PM323 licence. We will set out our guidance for 2026 alongside our annual reserves update later this month.“

This trading update is in line with guidance, production of 19,829 boe/d was within the 19,500-21,500 boe/d range and was up 6% y/y, an underlying gain of 14% ex sold interests. The best performer was Akatara unsurprisingly, with continued strong performance which underpinned group production, 2025 was ~6,100 boe/d with 94.4% uptime. 

Production costs were down 14% y/y, at the lower end of guided range which meant that operating margins were enhanced and pleasingly ‘resilient’ to a range of commodity prices. The company have deferred certain costs into this year after the unplanned overrun of costs at Skua which is sensible housekeeping and useful flexibility in financial planning and on that subject there was a good hedging performance.

Net debt of $89m($104.8m) was down by some 15% and as CEO Mitch Little adds, ‘builds resilience to lower near-term oil prices’. On which subject the update states that ‘due to a reduced oil price outlook at the end of 2025 (vs. 2024), Jadestone expects to record a non-cash impairment to certain assets in its year-end 2025 accounts’.

This is clearly the reason why the shares have fallen today, as with other companies in the upcoming reporting season, there will be some impairments due to the commodity price fall, the good thing for Jadestone is that it has shown an aggressive and highly successful attack on costs which mitigates some of the write-downs. 

Another positive is that the company is positioning itself away from older and more inefficient assets and my recent visit to Akatara showed that convincingly. With its high uptime and excellent operational efficiency it is a real gem, with a blue print like this, and good pricing due to strong domestic demand if it can be replicated then that would be well worth it. 

The plans for the Nam Du/U Minh discoveries are well advanced, the FDP has been approved by the Vietnamese regulator and is now awaiting final Government approval, the CEO has stated that he is ‘increasingly optimistic for good news in the near-term which means a great deal. Finally the negotiations on the GSA are also at an advanced stage which is also very encouraging. 

Jadestone have not given any guidance for this year in this RNS, it is expected at the end of February along with the reserves update. Overall this was a good update, all guidance beaten and the important parts either delivering well or about to be announced. I met with Mitch Little last year and spent valuable time with him, he has impressive credentials and the best experience in similar projects, Jadestone is in good hands.

 2025 Operations Update

• Continued excellent safety and environmental performance across the Group. On an aggregate basis, we surpassed 12 million manhours across Jadestone’s operations without a lost-time injury (“LTI”), underpinned by Akatara, where since inception of the project, over 9 million manhours have been worked without an LTI.
• 2025 average production was a Group annual record of 19,829 boe/d (2024: 18,696 boe/d) and in line with guidance (19,500-21,500 boe/d), representing 6% growth year-on-year.
  • Underlying production growth of 14% from Jadestone’s retained business, excluding the Sinphuhorm field interest, which was sold during the year.
  • Continued strong performance from Akatara underpinned Group production, with 2025 production ahead of plan at ~6,100 boe/d, driven by 94.4% uptime[1] at the processing facilities and optimization of plant throughput.
• 2025 total production costs[2] of US$243.0 million (2024: US$282.8 million), delivered at the lower end of the guidance range (US$240-280 million) and a reduction of 14% year-on-year.
  • This performance reflects the Group’s ongoing focus on enhancing operating margins and increasing the Group’s resilience across a broad range of commodity prices.
  • The outcome also delivers on the Group’s commitment to financial discipline, deferring certain activities into 2026 to offset the unplanned increase in capital expenditure incurred on the Skua-11ST drilling campaign.
• In March 2025, the Group submitted a Field Development Plan for the Nam Du/U Minh discoveries offshore Vietnam which has been approved by Petrovietnam, the industry regulator, and is in the final stages of government approval. Negotiations on a gas sales agreement for Nam Du/U Minh are also at an advanced stage.

2025 Financial Update[3]

• 2025 revenues (post-hedging) of US$408.1 million (2024: US$395.0 million), an increase of 3% year-on-year.
• The average realized price for oil liftings in 2025 was US$74.42/bbl, a 13% reduction on 2024 (US$85.21/bbl).
  • The year-on-year decrease primarily reflects the fall in the underlying Brent benchmark during the period. The average premium for oil sales during 2025 was US$3.17/bbl (2024: US$3.76/bbl), again reflecting the decline in the Brent benchmark.
• The average 2025 realization for Akatara condensate and LPG sales was US$45.89/boe (2024: US$56.69/bbl), reflecting movements in pricing benchmarks.
• The average Group gas price realization during the period was US$5.83/mcf (2024: US$3.91/mcf), reflecting a full period of sales from the Akatara field.
• The Group generated a profit of US$17.2 million on the disposal of its Thailand interests in April 2025, compared to the original acquisition price of US$27.8 million.
• 2025 capital expenditure of US$112.7 million (2024: US$74.5 million), in line with guidance (US$105-115 million) and reflecting the Skua-11ST drilling campaign during the year.
• Net debt at 31 December 2025 was US$89.0 million (31 December 2024: US$104.8 million), comprising US$61.0 million of cash (including restricted cash) and US$150.0 million of debt. The net debt figure at 31 December 2025 excludes US$23.7 million of proceeds related to liftings in December 2025 received in early 2026.[4] The Group’s US$30.0 million working capital facility remained undrawn at the end of 2025.
• Including hedges placed in early 2026, the Group has hedged ~1.7 million barrels of oil and condensate production over the nine months ending 30 September 2026, at an average Brent price of US$67.48/bbl (excluding asset-specific premiums or discounts).
  • Current hedged volumes represent ~42% of forecast oil and condensate production over the nine months ending 30 September 2026.
• Due to a reduced oil price outlook at the end of 2025 (vs. 2024), Jadestone expects to record a non-cash impairment to certain assets in its year-end 2025 accounts.

[1] Excluding planned shutdown
[2] Total production costs are stated prior to audit adjustments including non-cash inventory and lifting movements. Both 2024 and 2025 total production costs include certain items previously classified as general and administrative costs.
[3] Totals may not add due to rounding.
[4] The Group’s net debt and liquidity remains subject to several factors, particularly the timing of receipts from oil and gas sales, capital expenditure and scheduled repayments under the Group’s reserves-based lending facility.

Original article   l   KeyFacts Energy Industry Directory: Malcy's Blog