webinar. I'm Shelley Robertson, Managing Director and CEO, and it's lovely to have you here with us today. Before I get started, I'd like to introduce that we are lucky enough to have Julia Gruer joining us today. It's her first day in Investor Relations and Corporate Development role. She'll be looking forward to engaging with you all as the year progresses. I thought I'd start today with just a reminder of who we are today at Strike. You all know Strike as a listed energy company, with a number of key projects that I'll work through today. We have a refreshed board since the end of the financial year, with Nev Power as Chair. Jill Hoffmann, Will Barker, and Stephen Bizzell joining me on the board. What we found is that a smaller, fit-for-purpose board is working really well for Strike.
We're enjoying moving the company forward as a group. This is just a brief overview of our portfolio for those of us perhaps who have joined in more recently onto the register. On the right, there's a map. What you see in the blue there is our very extensive portfolio of more than 3,000 sq km of acreage in the Perth Basin. All that acreage is 100% owned by Strike, apart from the West Erregulla joint venture, which is 50/50 with Hancock Energy. Our key projects that I'll talk about today are Walyering, West Erregulla, and South Erregulla, as well as our exploration projects, Ocean Hill, Kadathinni, and the remainder of the Perth Basin. If we talk about the highlights of FY 2026 and recent milestones, certainly it's been an exciting year for Strike, FY 2026.
With the continuing construction, getting very close to commissioning of the South Erregulla Power Project, which we call SEPP. SEPP is an 85 MW power station based in the midwest, and we are very close to getting that power station online with Western Power in the final stages of commissioning and dynamic modeling. That's very exciting for us because it's been a big project on the go for a little while now. We also have West Erregulla, where we increased our net reserves, net 2P Reserves. That's another exciting project I'll talk about. If you were on the recent webinar, you'll know, but we certainly reached agreement with Hancock on the way forward on a pathway to market for us, which is great. With Walyering, we'll talk through Walyering and where we're up to.
On here, we're also talking about the AUD 30 million Macquarie facility that was made available when we reached agreement with Hancock on the implementation agreement. If we get through to our financial results now, we can talk to the sales revenue of AUD 62.8 million, the underlying EBITDA, AUD 17.6 million, and cash at 30 June, AUD 46.3 million. The important thing to note here is that we did have a big year with CapEx of AUD 151.3 million, which is predominantly for the South Erregulla Power Station. Acknowledging we had lower Walyering production, just with the natural field decline, but we've certainly done things to get that sorted out. That has meant an increase to third-party gas purchasing and sales during the year, which impacted our EBITDA.
What it has done, though, certainly with our investment, has increased materially by around AUD 59.1 million with the advent of South Erregulla. If we talk to Walyering now, Walyering is a project that has been around for a little while, so it has been producing for a few years. What we have seen is lower field production. So certainly reservoir decline. As a result of that, we have certainly had to do some interventions, which has included compression, bringing compression on, and purchasing third-party gas to meet our contractual commitments. I think the important thing here to note is that we are moving forward. We have put the compression online successfully and also drilled Walyering West, which has been a discovery and has given us a 21% increase in reserves there. So that is really important because it keeps that plant running into the future.
We are currently working through the FEED process on the Walyering West well, and we will keep you updated on that as we move forward. What I would say is with compression online and Walyering West preparing to be tied in, Walyering is certainly looking better. South Erregulla, the power station, there is a lovely photo of it there. We are certainly very close now. The facility is amazing. It is 100% Strike-owned, and we are running that power station from our own gas reserves. This is a very important project for us because it certainly, for one, it demonstrates that we are able to bring a project online like this. This is the first gas reciprocating engine power station on the SWIS. It is new for W.A., but it is very excitingly new for Strike as well.
The team have done an outstanding job in getting this project through to this point.
What this project means for us is a new high-margin earnings stream for Strike, with exposure to both capacity credit payments and the electricity market. This slide gives you a little bit of a look at the capacity revenue that we look to be able to achieve through the power station once it is online. So for calendar year 2027, AUD 19 million in capacity revenue payments. Calendar year 2028, AUD 31 million. Calendar year 2029, up to AUD 42 million. With those capacity revenue payments, we actually get a two-year firm look ahead on what the price is going to be. At the moment, the prices are increasing, and so that is positive for us. In addition to these capacity revenue payments, we have the actual electricity sale. That revenue is driven by how many hours we are online.
How it will work at South Erregulla as a peaking plant is that we will look to optimize coming online when the wind is not blowing. When wind comes online, the price in the market drops, and we will stay out of the market. As the wind falls, South Erregulla will come online and begin generating. We have got a very quick ramp-up time with the power station. We can come on as quickly as we like. The power is actually driven by 15-minute intervals, and so we will be asked to come online based on the price that we have set. For example, there is a couple of revenue streams there for if we were producing six hours a day at a certain price or 10 hours a day at a certain price, we will be certainly generating decent revenue.
Although we have built some debt against this project to deliver, we certainly will have two good revenue streams from SEPP coming into play as we move forward. The other thing that is interesting about SEPP is its location. SEPP is located on Strike's 100% owned freehold land. We have 3,500 hectares of land in the midwest. You can see South Erregulla, the gas field there is just to the south of West Erregulla, the joint venture we have with Hancock. We have a connection through to the transmission network on a 132 kV line. We also have been running studies on that land area for some time now to understand wind generation. We have up to 300 MW of wind capacity there. It is quite a neat little project, which gives us lots of different opportunities.
We are close to Perth, close to Geraldton, close to the Brand Highway where the fiber optic cables run. A few different ideas coming through here, but lots of opportunity out at this site. Moving on to West Erregulla. It was the big project that we announced on 31st of August that we actually had reached agreement with Hancock on the pathway forward to putting our gas through their 100% owned Belisama gas processing facility. The Belisama gas processing facility is located just directly between South Erregulla and West Erregulla, and so just 3 km from the West Erregulla field. Ultimately, it was a very good choice to choose that pathway for our gas, and we are now working very closely with Hancock to get our long-form documents completed before the end of this year.
Here is some indicative revenue that we have from the West Erregulla facility, and from our field at AUD 8 a gigajoule is AUD 127 million. We are targeting upstream FID by mid-FY 2028, which is the piece around the West Erregulla joint venture, the wells and so on. Then those wells will be connected through to the Belisama facility, targeting first gas by mid-calendar year 2029. Certainly, we have materially advanced our documents with Hancock over the past short period of time, and this is really one of Strike's biggest projects, biggest, most exciting projects. We are looking forward to getting this moving as quickly as we can. What we currently have with Hancock is we have the implementation agreement in place, which is the framework of all the key principles that help to guide our long-form document creation.
In that implementation agreement, a couple of things we have are a fixed capacity charge, which means we de-risk. We understand the cost of putting our gas through the Belisama plant, and we then still own that gas out the other side to sell into the market. We certainly are very aligned with Hancock on this development. We are looking forward to working closely with them to bring this project to market, because I think as we go forward, the gas market is tightening in Western Australia. There is going to be a bigger gap between supply and demand between about 2030. This gas is really materially important for the state of Western Australia. This is just a slide briefly outlining the Macquarie Bank debt structure. It has been out in the domain previously, but I think it is just useful to understand.
We still have Tranche C, which is uncommitted, and subject to CPs on West Erregulla. At the moment, our borrowings are AUD 157.7 million, and that's predominantly on the Strike on the South Erregulla project. Our cash and net debt position is shown there as well. This is a slide that some of you will have been familiar with, and I've spoken to previously a couple of times, but this really for us is the money slide. It shows our pipeline of growth. It's exciting for us. We have our foundation project, Walyering, with around AUD 52 million revenue per annum. Looking to backfill that production, the production decline with that Walyering West well coming online fairly soon. Then we have South Erregulla, the power station. As soon as we get that commissioned by the end of this year, that's going to be real near-term cash flow.
That's another, how you look at it, but AUD 50 million - AUD 75 million of revenue on top of Walyering. West Erregulla coming online mid 2029 is very exciting, and we've got a little bar chart there which just shows illustrative gas prices and the revenue at that gas price of our 43.5 TJ a day. The Belisama facility has a 210 TJ a day capacity. Our 43.5 TJ a day is a significant portion of that. Based on, say, an AUD 8 gas price, we're looking at a revenue stream there of AUD 127 million. When you add those three revenue streams together, we're starting to look at a significantly different Strike as we go forward. The fourth box there is around our exploration portfolio, and I know shareholders have been patiently waiting for some developments there around exploration and progress.
As we bring these cash flows online and we start generating some revenue, paying down our debt, we're going to be very carefully managing capital. We certainly have in our sight the importance of bringing on some of those exploration programs that we've all been waiting for. Ocean Hill and Kadathinni are probably the first in the stack, and there are a number of others as well. It's a very exciting profile for us of Strike and truly at a transformational point with some Walyering already producing and giving us revenue. South Erregulla really close, West Erregulla on the short-term horizon, and then our big exploration portfolio out the other side. I think we have enormous opportunity here at Strike to actually really capitalize on all of this and to deliver something really special.
This is just a refresh on the exploration upside that we do have at Strike. I spoke to Ocean Hill and Kadathinni, but in the middle there is L26, which is the West Erregulla footprint. The 10-year we hold with Hancock also has near field upside. That will also be looked to be further exploration carried out in the coming years. The financial priorities for this year are obviously to get South Erregulla online. That's critical. To actually convert that into cash flow. We're looking forward to that. Total forecast project cost is around AUD 186 million. We're really looking like seeing that plant coming online by the end of this year. Funding for West Erregulla to FID has been really important.
Our agreement with Hancock saw us pursue AUD 30 million in funding from Hancock to help us get through to FID, subject to Macquarie consent. Certainly, that will help us to get through on West Erregulla. Then we have our debt facility with Macquarie. We have an additional facility released from Macquarie just recently, and that will actually help us to continue on all of our development fronts as well. Then around, I guess, the most important thing is us having real capital discipline to pursue exploration and development programs throughout the coming year. This is the slide that I will end on. It is "Why Strike? Why Now?" I think everybody knows why Strike, why now. We have West Erregulla, Walyering, and South Erregulla all coming online. We have a really solid revenue growth ahead of us and exposure to different markets.
We have the electricity market, we have the gas market, which is great to have that diversification. We also have the organic growth opportunities. I will speak again briefly about the opportunities we have at SEPP with that land we have and the location of that land and the opportunities that are around that as well. That is where I will end the presentation today, except we do have some questions that have come through. I will just run through them now. The first one was just around what will be happening with third-party gas sales as we go forward at Walyering. The idea is that now we have the Walyering compression installed, that we are expecting to be able to meet that contract for a longer period of time.
Then in the background, we are working on the FEED program to actually tie Walyering West back into the Walyering facility. That will be looking to minimize any third-party gas purchases in the future. Then I have just got some more questions that came through on email. The first question is, "What are the key work streams to be funded by the AUD 30 million Hancock pre-FID facility?" The upstream work program is expected to remain broadly consistent with the development scope previously communicated, including development drilling of West Erregulla six and completion activities, workovers of West Erregulla two, three, and four. The detailed scope, sequencing, and budget for pre-FID work is currently being aligned with Hancock through the JV work program and budget process. We therefore do not intend to provide a more detailed work program or updated capital estimate until that is complete.
However, the AUD 30 million of Hancock pre-FID funding is intended to support Strike's share of expenditure required to progress West Erregulla towards FID. While we currently expect the overall upstream work program to remain broadly consistent with those assumptions made previously, Strike and Hancock are still aligned on the detailed work program and budget for the development. We are still working through that with Hancock. It is a little bit early to provide updated CapEx guidance at this stage. Importantly, Strike remains operator through to FID, which means we will be allowed to control the definition and optimization of the upstream development plan. By FID, we expect to have a more mature work program and sufficiently de-defined CapEx estimate to provide updated guidance. I hope that answers that question.
This next question is, "What guidance are you giving on remaining upstream CapEx at West Erregulla?" I've answered that one now. "What's the remaining CapEx for South Erregulla as at 30 June 2026?" As at 30 June 2026, Strike forecasts approximately AUD 16 million of remaining CapEx to complete South Erregulla. Since year-end, the project has continued to progress and remains forecast expenditure is now approximately AUD 11 million. As with any project nearing completion and commissioning, the remaining expenditure is forecast to remain subject to final commissioning activities, project closeout, and the additional works that may be required. "What's the use of funds for the drawdown of the AUD 30 million Macquarie facility in December?
Is this for South Erregulla work, or will it sit on the balance sheet for now?" The AUD 30 million Macquarie facility was drawn to provide additional liquidity as Strike completes South Erregulla and progresses its broader development program. The funds are not specifically quarantined to South Erregulla and will be deployed against the company's funding requirements as they arise. In the interim, any funds not immediately required will remain as cash on the balance sheet. I think that's all the questions that we have today. If there are any additional questions, please feel free to send them through to myself or Julia. We'll make sure that Julia's email address is available for any of you that would like to reach out.
I'm very pleased to have Julia on the team, and we're looking forward to getting out and meeting some more of the shareholders in the coming weeks and months. Thank you very much for joining us on the webinar today. Like I said, if you have any questions, please do send them through. Thank you.