"I can't find any reference in the AR to the EDL contract having any pre-payment, do you have a source? It looks to me that the three deferred commitments are to PWC, Macquarie's pre-purchase, and Mereenie gas balancing (also to Macquarie, as JV partner)."
I don't have a source and am reading between the lines, as you often have to do but i could be wrong:
Deferred revenue at points of time above. We knew that:
- EDL gas contract signed Apr-17 with first delivery of gas commencing 1 Jun 2017. First cashflow was received in Jul-17.
- PWC take or pay cash is received annualy in March quarters (as I understand).
- Joint venture production overlift is recognised as a provision, not deferred revenue.
At this stage, these factors above corresponds with the movement in deferred revenue above - i.e. that the cash received was
probably in relation to EDL and not from PWC.
I have also checked the quarterly cashflows and note that there were no additional cash inlfows (i.e. $5m addtitional cash) that stick out. It has left me a little bit puzzled.
It's not from IPL - IPL prepaid us for $5m of gas but that was in Dec-18 quarter.
In anycase, total deferred income (PWC, IPL and probably(?) EDL) and MQ prepaid gas at Dec-18 is c. $40m. A fair bit to unwind.
"In the AR, the first line of Note 15 appears to contradict your interpretation of 15 (b):
"Proceeds received under Take-or-Pay contracts where gas is able to be taken by the customer in future periods:"
So reading Note 15 in its entirety it appears that CTP recognises revenue when PWC forfeits delivery under take-or-pay, but that PWC is entitled to take that gas at a later date (which, as discussed, is unusual for a take-or-pay contract). It appears that PWC has on-sold the gas and received revenue for it, so CTP needs to deliver that gas at its own expense, which is presumably the liability on the balance sheet."
I don't think this contradicts what i said above, I said:
"...it appears we have c. $13m of cash up front at Jun-18 to be spread over multiple years of gas delivery..."
I said multiple years as there is a split between short / long term deferred revenue. I would think they have contractual volumes they can receive in a certain period, but PWC could not delay those contractual volumes into subsequent periods. They would have to forfeit or onsell the gas (as you say above) and noted in the AR:
"Take-or-Pay proceeds are taken to revenue at the earlier of physical delivery of the gas to the customer or upon forfeiture of theright to gas under the contract."
RC did love a contract that received cash up front from customers.... PWC, IPL, MQ.......EDL??
