Everyone, thanks for joining us for Valeura Energy's Q3 2024 webcast conference call. My name is Robin Martin. I'm Valeura's Vice President, Investor Relations and Communications. Joining me on this call today are CEO Sean Guest, CFO Yacine Ben-Meriem, and COO Greg Kulawski. The time is now 11:01 P.M. Singapore time, and we are recording today's event. We'll make a replay of this call available through our website later today. Running order for the event today, in a moment I'm going to hand over to Sean to take us through some prepared remarks. After that, we'll do a Q&A session, and I'll guide us through that portion. We'll be taking live questions this time. And to signal that you'd like to ask a question, you can use the raise hand feature in Microsoft Teams. It's a hand icon toward the top of your screen.
Before we get going, I'll just point your attention to our disclaimers and advisory slide, which should be shown on your screen now. These slides are also available on our website. Pointing out in particular the information here or the disclaimers here on forward-looking statements that we may use throughout the presentation. So with that, I will hand the slides over to Sean, and you can go ahead.
Yeah, thank you very much, Robin. And welcome, everyone. From good morning in Canada through to good evening or good night over here in Asia. Before I hand over to Greg and then to Yacine, maybe just give the Reader's Digest version of the key points that we're going to make in the presentation today. So looking first at production, our Q3 production was up slightly on Q2, even though we had some issues we were dealing with with the Wassana field. However, importantly, with Nong Yao C field brought on, we're now looking at Q4 production of around 26,000 barrels a day, which is up more than 35% if we go back to Q4 in 2023.
And even more importantly, this higher production now and the work that we've done this year is really guiding us towards a 2025 production that's above the current consensus from the analysts that we see out there. So good news across production. Now, on the other side of the equation on costs, OpEx is pretty well coming in right on guidance, but we are seeing an improving trend. CapEx is coming at the low end of our initial guidance, but more importantly, because we are drilling, have the rig on contract for the full year, that cost is largely fixed. But with efficiencies, we expect to yield 22 production wells against our original budget, which was at 16. So we're seeing some really good work from the rig.
And that kind of leads us to show that we now have extended that rig for an additional year into Q3 of 2026. That we took advantage of what we saw there as some good rig rates, and we extended that for another year. We also see a lot of activity we have coming up with the success we've had in increasing production and reserves. Cash flow, obviously key. We ended up with $156 million at the end of Q3. Importantly also, given the timing of liftings, we ended up with a record high inventory for us, so with 1.2 million barrels of oil. Now, the most important thing that we've really come across recently is we have now completed. It is fully signed off on our corporate restructuring so that all of the Thai III assets are now under the company that only originally held the Wassana assets.
That is going to really accelerate a lot of near-term cash flow as those three producing fields can now access approximately $400 million in tax losses. That's a huge boost to the cash flow of the company. And then following on that news, you would have seen in the past couple of days, we did an announcement on share buybacks. We now see with the cash position we have, this accelerated cash flow, the strength of the balance sheet, that we have enough cash to really do the organic growth that we're looking at in the assets in Thailand, the M&A opportunities that we're looking at, as well as providing some returns to shareholders. So good news across all of that capital allocation.
Before I hand over, the final point I want to make is since we've taken over these assets in 2022 and 2023 in the Gulf of Thailand here, we've made a number of promises. We've set a number of targets, and I believe we're delivering across all of those, both financially and operationally. We see our guidance. We're going to either confirm all of the estimates on the midpoint or in the end of costs. We see the CAPEX lower. Importantly, really for us, the focus is on those reserves and the resources. We saw the significant increase at the end of 2023 with more than 200% reserve replacement ratio. I can tell you with the drilling and the field development we've done this year, it's looking very good for 2024. With that, I'll hand over to Greg.
If we could have the next slide, Robin.
Thank you, Sean. Hello, everybody. Let me show just a few more points on production over the last few months. So in July, production was lower due to the precautionary suspension of the Wassana field related to the underwater inspection. When this was resolved, Wassana safely resumed production on the 5th of August. And then on the 15th of August, we achieved first oil from the Nong Yao C facility and then quickly ramped up production in the next few days. In September and in October, production was over 26,000 barrels. And overall, we are very pleased that all facilities are running smoothly, and particularly the new facility, Nong Yao C. So just as Sean said, for Q4 2024 as a whole, we expect production around 26,000 barrels and the full year average close to the middle point of the guidance range for this year.
Again, importantly, this higher rate in Q4 of this year, we expect will underpin guidance for production for 2025, which will be above the current analyst rate. Now, moving to CAPEX, next slide, Robin, please. Again, CapEx is coming in at the low end of our guidance, which is quite important considering that most of the drilling CAPEX is largely fixed through the rig contract and associated contracts. Now, we have achieved significant efficiencies in drilling, and this year we expect to deliver 22 production wells against our original plan of 16. I think it's again worth to highlight that our portfolio provides significant optionality, which we do exploit to continuously optimize the drilling sequence. In Q2, we added Nong Yao A infill production wells in advance of the Nong Yao C mobile being ready for drilling.
All of this good drilling performance through the year enabled us now to accelerate the Manora infill drilling program into 2024. Now, a few final points before I hand over to Yacine. Being a responsible operator, safe and efficient is critical to Valeura's success and is a real priority for us. Our safety performance so far this year has been excellent, touch wood, with no lost time incidents or no spills. Now, in addition, we expect to deliver around 15% decrease in the greenhouse gas emissions intensity relative to the baseline in 2023, 2023 being our first year of operatorship. Furthermore, our low BTU generator project for the Jasmine field is on track to come on stream around the end of Q1. This will bring us both savings in the cost of diesel and will also remove a significant amount of greenhouse gas emissions.
Now, with this, let me hand over to Yacine.
Thank you, Greg. Next slide, please, Robin. Greetings, everyone. I'd like to start by highlighting some key numbers for Q2. As Sean mentioned earlier, on our production average, 22,200 barrels in the quarter, lower than the last quarter. It's good to remind the audience that it's quite common for us to have a mismatch often between what we lift and what we produce. So you can see on the lifting side, what we sold, we sold 1.8 million barrels. This led to us having the highest inventory of oil during the history of the company of around 1.2 million. We did manage to sell a couple of cargoes in totality of 0.5 million barrels on the 1st of October, which obviously we now are going to be booked as sales for the next quarter four.
In terms of realized prices, now in September and August, we've seen oil prices coming down, impacting our realized prices. Our crude still traded at premium to Dubai, which is the key benchmark in the Gulf of Thailand, and we're selling the crude. And just arithmetically came slightly below Brent. This is really on the back of most of our sales occurring at the tail end of the quarter rather than the beginning. On the cost side, we recorded OPEX per barrel of $26.3 per barrel, which is an improvement from the last quarter, again with the flat CAPEX overall, or flat OPEX overall. On the CAPEX, it's broadly in line. This is the quarter when we had to pay payment for the pre-tax payment, which related to the H1 period in 2024, which amounted to around $31 million.
Overall, that has led to us recording all revenue of around $139 million and EBITDA of $71 million. This led to a pre-tax cash flow from operations of $64 million and a cash flow from operations of around $50 million. Now, shifting to the balance sheet, we ended the quarter with $156 million versus $147 million the last quarter. Importantly, our adjusted working capital is around $160 million, which is the highest we have in the company again. Next slide, please, Robin. Thank you. Now, let's break down the cash flow from operations for Q3. So as I mentioned earlier, we have recorded the revenue of $139 million on the back of the $1.8 million of liftings of sales. Our royalty total around $17 million this quarter, and our net revenue is around $122 million.
With OPEX of $54 million and SG&A, which have been flat compared to last quarter, of $4 million, we end up with an adjusted cash flow from operation of around $64 million, and with the PITA accrual, again, these numbers, the $14 million of PITA and SRB as accrued, $10.5 million of that amount is for PITA and the remainder is for the SRB. We end up with a cash flow from operation of around $50 million. Now, if we have managed to record those 500,000 barrels during quarter, obviously these adjusted cash flow from operations, and indeed all these numbers here that you see in the dark colors would have been significantly higher. Next slide, please, Robin. Now, moving on to the cash position, so we started the quarter with $147 million.
As you can see, our cash flow from operations is more to cover our OPEX and we've got a large headroom of $35 million. This quarter, we also recorded other income, which consists of royalty payment that we receive on the Rossukon field. As a reminder, we are due part of our divestment of the Rossukon field, we receive royalties. And embedded in that $2 million as well is some interest income as well. CAPEX at $35 million, expenses were probably just below $1 million. And as you can see there, there has been a tax payment of $31 million. With the adjustment in the working capital, we end up with the quarter at $156 million.
I think it's important to highlight that with the additional cargo coming recorded in sales in Q4 and an exit rate of around 26 million, we're certainly looking forward to a strong quarter in Q4. Next slide, please, Robin. Now, as Sean mentioned earlier on at the beginning, I think one of the key events this quarter is really this reorganization. Maybe as a general reminder to everyone, this organization allows us, mechanically speaking, to aggregate all of our assets and at the same time reaching Thai III, which is the Nong Yao, the Manora field, and the Wassana field in the one entity. This enables us to effectively use all the PITA tax losses that are sitting in the Wassana company, which amount as of the 30th of September to just shy of $400 million.
Now, what we've put here in front of you is an illustration as to what the impact of that organization ought to look like. And again, we've used the last 12 months as an example to illustrate the effect of that. So what you have on the top side of the graph there is effectively our last 12 months' financials. During those 12 months, our production averaged 21,000 barrels. And the realized price obviously was slightly higher than it is today at $84. But again, just trying to point you towards what the 21,000 barrels looks like versus a potential higher number for going forward for today on today for us. So as you can see there, the revenue recorded, the adjusted, I'm not going to walk you through all the numbers obviously, but maybe I'll start from the adjusted pre-tax cash flow of $311 million there.
The PITA component paid on that amount is around $82 million, and the SRB was $10 million. This has led to a cash flow from operation of quite substantial of $222 million. And if you deduct the CAPEX after that, the free cash flow is just shy of $95 million. Now, if we have managed to do this tax reorganization or this reorganization at the beginning of last, sorry, 12 months ago, our cash flow, as you can see from operations, have totaled to just shy of $280 million. And most importantly, our free cash flow from operations would have been $152 million, which is an uplift of around 62% compared to prior to without the reorganization. And just this is highlight how value enhancing and kind of a boost to the cash flow this reorganization should be able to deliver to the company.
Maybe specifically, if you look at it from the PITA perspective, initially we would have paid $82 million, but in a post-reorganization, it would have been $24 million. This $24 million relates to really the PITA from the Jasmine, which is excluded from this reorganization. Now, if you take that $400 million tax losses, PITA tax losses, and you apply the 52% tax rate, you can see how we end up with an enhanced, at least an additional cash flow, free cash flow for around $200 million. Our expectation now, looking at the current oil prices and effectively the plan going forward, we'll see these amounts being realized in the next two to three, sorry, three to four years, all subject to oil prices. Obviously, if the oil price shoots up again, that period, that time window will shorten significantly. Next slide, please, Robin.
Now, obviously, with the enhanced cash flow, with a strong balance sheet, obviously our capital allocation framework comes into play as well, and it is something that we presented to the market a few months ago. It's worth kind of revisiting it now in light of the tax restructuring and the performance as well expected going forward from the portfolio, but I think we've been quite transparent with the market in terms of how we see our priorities when it comes to capital spending. Obviously, investing in our portfolio is a priority for us, and our philosophy, so to speak, is to spend to maintain our production between 20,000-25,000 barrels well into the 2030s, and it seems that the work that Greg and Yacine have done from a technical perspective kind of again supports that assertion at this point in time.
We also see some exploration that the previous owner of the assets haven't really kind of gone after, and with the work that the team have done, we see some interesting opportunities that we would like to target, again, to enhance from our current portfolio. The one that comes to our mind that we see as critical, as one important piece next year is the rig- free on Jasmine, which could really unlock significant upside there as well. M&A is a cornerstone in terms of what we do. So therefore, any value appreciative M&A is at the forefront in terms of how we think about capital allocations. We are, and we will remain very strict in terms of those selection criteria that we apply for those acquisitions. We are patient money. We will wait for the right opportunities.
We don't rush into doing deals just for the sake of doing deals. Value appreciation is critical to any M&A opportunity we look at. And when we look at those M&A opportunities, we tend to prefer cash-generated assets or at least assets that we can see in a line of sight in terms of their ability to generate the cash in production. As we said earlier on, with the cash balance where it stands today and with the forward cash flow that we expect over the next few years, we see the ability for us to also at the same time while maintaining the hunt for M&A and investment in our portfolio to allocate some of that capital to some share buyback and some shareholders' return. So you've seen we just announced yesterday our approval to start the share buyback program.
That's going to be effective from today, and it's for one year. And all the shares that are going to be purchased are going to be canceled. Our targeted amount, sorry, our maximum amount is around 7.3 million shares with a daily, as you can see there in the box, with a daily maximum of just shy of 80,000 shares per day. Now, we will be careful in terms of how we deploy that capital. The key driver for us in terms of when we think about share buyback is really trying to, it doesn't come as a surprise that we see our share price today is way undervalued compared to where it ought to be. And this is, again, our belief that the value from a shareholder accretion perspective, that also makes sense for us. And with that, I'll hand back to Shaun.
Thanks, Yacine. Yeah, so just talking about it as we started at the beginning about what have we accomplished in the past 18 months. Because it was really just over 18 months ago that we brought this portfolio together and really started our production operations in Thailand. And as we pointed out, the key thing is on that production, production up 38% from Q4 2023. So that's great. But again, bring that focus back to reserves. And the work that we've done on identifying more opportunities on the infill drilling on the development we've done, 2023, that was 219% reserve replacement ratio. The reserves were increased across every field, not just one or two. And the end of field life was increased on every field as well.
Now, we've obviously pointed that we are looking at a redevelopment of Wassana, and we see significant upside in oil volumes there, which obviously we see that field being able to successfully push it well into the 2030s or mid-2030s. We did do three successful exploration wells, and a lot of this is demonstrating there is more oil to find out here that we can tie back economically. But importantly, it's with that drilling we've done, the exploration, the other drilling, what we see, the increase we see for the year-end 2024 on both the reserves and on the resources is looking good. But obviously, we still have to look ahead until our reserves auditor has completed that work and released it in likely about mid to late February. On the balance sheet, cash is good. We just talked about the corporate restructuring.
We're seeing the production increases as well, which is all pointing towards really good cash flow as we go towards 2025, but the last element on the balance sheet is also the abandonment liabilities, the ARO. Now, last year, we saw a significant reduction in that, and what I can say is we've done quite a bit more engineering work on that this year, and that's a focus for the team as well. It's just demonstrating that also that amount is really decreasing as we see the amount of abandonment going on in the Gulf of Thailand, so we're just extremely pleased on how the team in Thailand is performing, how the results are coming forward, and that we're really delivering across all aspects of our business. Next slide, Robin, so just looking at how have we really been doing as a company?
If you look at, we have a 20-company international peer group that trade on Toronto, London, and Australia. And if you look back from 2022, we were the number one performer in that peer group. In 2023, we were the number one performer. And again, in 2024, we're the number one performer in that peer group. We have done extremely well year on year. But what I can say, the messaging we kind of hear when we're out there is generally that I've missed it. People see the large increase we've had, and I think it's creating a bit of a level of nervousness. But we still see that there's significant value upside in the share price, even though we've been delivering these top results. And you can see on the left how we trade with peers on production and cash flow metrics.
There were still significantly undervalued of those same 20-company peers, so when you then look at how we're trading on our share price today being around CAD 0.54, if you look back at year-end 2023, the NSAI and our cash at that time would have had us at CAD 0.758. Now, that corporate restructuring will increase that, and that brings all those metrics to where are the analysts, where is NSAI in year-end 2023 looking of that just under $10 mark, so we're still at a significant discount to that, but you can see where the peers would be or where we would be if we were at the trading metrics of our peers. The key point is the NSAI, the analyst numbers do not have the work that we've done this year and where we expect the reserves and resources to be.
We still see significant upside in the share price as we move forward. We see we're still one of the cheapest shares out there, and we continue to deliver. So with that, I'd like to hand it back over to Robin. We'll take some questions at this point in time. And thanks. Thank you, everyone, for joining us.
Thank you.
Thanks, Sean. As I've mentioned, we'll be able to take live questions on this call. Just bear with me a moment to enable that. Your first question is going to come from David Round. So David, just bear with me a second. I'm going to change settings here to allow you to unmute your line. You should be able to do that now. Go ahead. This is David Round from Stifel. Whenever you're ready, David.
Hopefully, that's work. Can you hear me, Robin?
Yes, all good. Go ahead.
Perfect. Right. Brilliant. Thanks, guys. Thanks for the presentation. I've got a couple of questions. The first one, I'm going to go back to one of the earlier slides, and there's a comment in there that says you are poised to exceed initial expectations for 2025. I just wonder, are you able to help us understand how much of that is driven by what you're seeing in terms of better well results versus the increased activity you also talk about?
Yeah. Hi, David. This is Greg. I think it's a combination of both. So I think, as we have said, we have managed to drill more wells, more production wells this year than we originally planned. So that's a plus. And some of the wells and some of the fields are performing better than we expected, particularly Nong Yao C is doing really well.
Okay. Great. Second question, tax reorganization, obviously brilliant to see that come through. I'm just wondering whether it's going to change your approach at all. And particularly, I suppose I'm thinking about how you're ranking the opportunities pre and post the tax reorg. I assume some have moved up in the pecking order. Would that be correct?
Hi, David. This is Yacine. Are we talking in terms of our own portfolio or more in terms of M&A?
Your own portfolio and thinking about, obviously, the consolidation affects three of the fields and not the other one, so whether you're probably incentivized to focus more on those fields than Jasmine.
It's a good question. We're highlighting that, for example, when it comes to our portfolio, obviously, Nong Yao is our most profitable field by far. I think the OPEX per barrel there is just shy of $14. So you can see, for example, in terms of how we think about things, whether it might be better to kind of allocate more work there. But again, it's more of a portfolio approach, I guess, rather than specifically just driven by tax organization or tax monetization.
Okay. Great. And final one, it's just a quick clarification. You mentioned the additional rig contract. Could you just remind me exactly when that contract runs into? And I'd be interested in any kind of inflation that you saw on that contract versus what you had this year, please.
Yeah. So we've extended the contract effectively from September 25 through to August 26. So that's exactly a 12-month extension. And the rate that we signed the extension on is significantly lower to what we're paying this year. So we have seen improvement in the market. I think some of it came on the back of Saudi Arabia releasing a number of rigs. And so we've exploited this opportunity. And given the portfolio that we have, it was a good time to extend the contract.
Brilliant. That's very clear and very helpful. I'll hand it back. Thank you.
Thanks, David. Next question will come from Jesus Sanchez. Jesus, just stand by for a second. I'll allow your microphone. There you go. Feel free to unmute when you're ready. Maybe Jesus is not ready. Let's move on. We'll come back to you. Stephane Foucaud of Auctus Advisors. Stephane, I'm going to allow your microphone. There you go. You're able to unmute.
Yes. Hi, Jen. Thanks for taking my questions. I've got two, hopefully quite straightforward. The first one, 4Q24 production is really high, 26,000 barrels per day. Do you see that rate sustainable in 2025, given probably the amount of flush production you had in Q4? That's my first question. And my second question, so Shaun, you talk about the expected good reserve replacement ratio in 2024. Are there any specific fields that you've been very happy with in terms of reserve addition in 2024? Thank you.
First of all, when we talk about the fields and the reserve replacement, the work is still ongoing, still working with NSAI. But a lot of the work that the team has done is really to go in very much in-depth into the fields, the productions, the history. Because you now have a lot of data from these fields as to how they're producing as they move into this kind of mid to later stage of their life. And the performance of the wells is actually, I think, doing better than you would model just using a standard hyperbolic type equation, for example. And it's building up that database to really demonstrate that we need to model this later life behavior differently to how it was previously being modeled.
So there's just a lot of really good work being done, not on one field or that, but across the portfolio to really look in much more detail than a lot of companies sometimes do to really then demonstrate to the reserve auditor where we see the potential. And I think the other question was really related to production. And look at, obviously, the Nong Yao facility right now is still pretty well producing at its maximum. So the fields, Nong Yao C is doing extremely well. The A and B facilities are doing extremely well. You're right. At some point, you'll see that start to come off. And we'll expect that we'll have to do some more infill drilling around that facility next year. That's currently in our plan.
No, we don't expect to be staying at 26 well through 2025, but we do expect to deliver kind of above the consensus type of production. We'll probably put our guidance out in mid-December or into early January, depending on how the production's going and timing.
Okay. Thank you. So I'm back on the reserves. If I understand what you're saying, it's that it's really across the fields that you're relooking at the historical production and recovery factor rather than a specific outperformer in 2024.
There will be some of that. And the guys do gap analysis on the different wells of different blocks that are producing to try and look for the gaps at where they have to investigate more. But they're also even going back and looking at the original STOIIP that's been used again, going back through the core data and the analysis there. And you have so much more information now on how things are producing.
I see. So difficult to say at this stage if there is really one that was really outperforming and driving reserve addition. That's what you're saying.
What we were really pleased with at year-end 2023 was that the reserve increases were across all the fields, and we would hope to see a similar effect this year, but again, we'll let our reserve auditor complete their work.
Thank you.
Thanks. I think Jesus is live there now.
Yeah. Do you hear me?
Yes.
Yes. Apologies for earlier. Congrats on the recent developments and the results. Just two questions, very quick questions. As far as I know, there is a 15% tax exit rate in Thailand. Will we have to pay that exit tax before buying back our shares in Toronto?
Hi, this is Yacine. No, we don't have to. We do have cash sitting outside of Thailand that we can deploy to do this.
Yeah. In order to perform the complete buyback program?
Yes.
Perfect. That's all my questions. Thank you very much.
No problem, Jesus.
Thanks, Jesus. Let's move on to Charlie Sharp of Canaccord. Charlie, you should be able to unmute your mic if you're ready for your question. We'll give you a minute, and I'll remind the audience that if you are interested in asking questions, just use the raise feature in Teams. And that's usually what you'd like to ask. Yes, Charlie. Good to go.
Sorry about that. Yeah. Apologies. Thanks very much for the presentation. Very comprehensive. Appreciate that. Just sort of going back to Nong Yao and maybe Wassana, I think in the results announcement, you indicated the strong performance of Nong Yao, and you've reiterated that today and indicated that it has the lowest per unit adjusted OPEX. I just wonder if there's something about Nong Yao that is particularly good that you can apply elsewhere across the portfolio, in particular into the redevelopment of Wassana, the bigger, larger development of Wassana. Are there lessons that you can apply? And then also on Nong Yao, what's the current status of Nong Yao D? Is that likely to be a go, or are you still in the consideration period?
Yeah. So I think on your first question in terms of Nong Yao metrics and performance and learnings and application for other fields, I would say two things. I mean, one is some of the features of Nong Yao are due to just the size of the production being at peak at the moment and then very efficient operations we've got there, including improvements after we have bought the FSO. So that's one part. I think the second part that's very much replicable across the portfolio is all of our drilling operations and continued improvement that we are applying there. And very much all of the ongoing lessons and the way we optimize rig performance, all of this is playing across all of the portfolio.
We are also using the size of the portfolio to optimize logistics, reduce fuel usage, and all of those features apply right across, including they will play into our new developments, particularly Wassana redevelopment. Yeah. There's another point too, which is on the power generation, I think, which is one that will flow through to Wassana as well, which is Nong Yao has some gas, and it was built with bi-fuel generators. So the gas provides a lot of the power requirements on the rig, whereas the older projects like Jasmine were set up to require diesel. So you're actually using that kind of gas that comes with the oil to supply a lot of the power, and that can reduce your OPEX a bit. So we're looking at that for Wassana, even though that is a lower GOR. So the oil itself has less gas in it.
There are areas we might be able to use bi-fuel.
That's great. Thanks, and Nong Yao D, where's that sitting at the moment?
Yeah. The team has been working on that. We were just up in Bangkok a couple of days ago and went through with the board a look at the program. They're working hard on that. They're working up a number of locations and that, and we have notional plans to get to some more drilling over there.
That's great. Thank you very much.
Just a reminder that if you're interested in asking a live question, just click the raise button. In the meantime, a couple of questions have come in through other means. I'll just voice them for the team here. First one, can you give an update on potential transformative M&A?
Yeah. I think the main thing to point out with the M&A, because this is one that does come up a lot. I can say recently we have been trying to push people to really have a good look at the value of the company. Because that last slide I showed, there is no M&A in that. There's still significant upside in its prior M&A. However, the point I'll kind of say is we are very focused on making sure we get the M&A deals that we want. They have to be accretive and tie in.
But at this point, what I can add to that is that there's no deal that we went for that we have not got, right? So deals that we're looking at are still active. There's none that we've actually lost at this point in time. So we're continuing to work on those. We see progress, but the larger ones where we use the term transformative will take a little while.
Okay. Next question is on Turkey. Can you discuss Turkey a little bit? Any active discussions? And also, how long can you keep renewing the licenses there?
Yeah. So we got our next extension finally gets added, approved by the government, and that was issued. We're looking at actually extending that further. Because we have obviously discovered things there, we could put in an application that we've had a discovery to get the two-year appraisal period.
But there is also a potential for a force majeure type of period given some delays that occurred there. So we're looking to try and extend those somewhere beyond the period that we have. If these blocks now go to June 25, we would see our desire to get another two to three years there. And that's a discussion that we're currently ongoing with. There are parties in the data room. We're now starting to rejuvenate our efforts given the fact that we do have these blocks assigned.
Great. One further question. How do you feel about hedging?
At the right price, yes. I mean, obviously, considering the overall market conditions today, it's worth highlighting that the oil price came down by $10 in the period of last two weeks. So we are actively looking at a way to at least protect the balance sheet. I think on the back of the tax consolidation and the strong performance operationally from the team and the expectation in terms of going forward, we're not worried about being effectively operationally being hammered by the oil price, but more trying to preserve that dry powder for further growth. But in short, yes, we are looking at a few hedges.
Yeah. I think we do look at it every quarter. It's something we investigate and discuss, but with no debt, with the cash position to fully cover all of our plans right now, it's not really required. So it's opportunistic. And with where oil price is now, I don't think we would see hedging at this point.
It's too expensive.
Yes. Very good. Okay. Well, thanks for that. We've got no further questions on the line at the moment. I'll just mention if there is anything that you'd like to ask, feel free to reach out to us. Email address is just ir@valeuraenergy.com. Available anytime. Sorry. One last question having come in here. Let's just get this one. How do you expect to actually use the buyback going forward? Is there a floor share price in mind that you're trying to support? Or what other conditions would enable you to be active in the market?
I think we did say earlier on that we see our current share price doesn't reflect the value of the business. I think that should give you an indication as to how we see this whole share buyback. But again, we're taking into consideration a few other aspects, or at least parameters in terms of defining that number. I don't think I'm going to be able to give you an exact number today. I don't think it's fair for the whole market. But at least it gives you some guidance of how we think about it.
Very good. Okay. No further questions from the floor. I'll hand over to you to wrap up, Sean.
Yeah. Thank you everyone for joining us here. As I said, we're obviously really pleased with the success we've had this year on bringing on these fields. Production is doing excellent. And we're really looking forward to getting into 2025. We'll get our guidance out, as we said, probably around year-end. But we're looking forward to a good year. It's very exciting. Thank you very much all for joining us and supporting us.
Thanks, everyone. That concludes the call.