Here’s why the Beach Energy share price is diving 6% on Tuesday

The Beach Energy Ltd (ASX: BPT) share price is in the red today.

Beach shares are currently down 4.49% at $1.81 a share, after recovering from a 6.59% fall earlier today. For perspective, the S&P/ASX 200 Index (ASX: XJO) is down 0.33% at the time of writing.

Let’s take a look at what is impacting the Beach Energy share price today.

What is going on?

Beach shares are falling more than other ASX oil and gas producers today. At present, Woodside Energy Group Ltd (ASX: WDS) is up 0.3% while Santos Ltd (ASX: STO) shares are down 1.29%.

Oil prices fell more than 3% overnight, as my Foolish colleague James reported this morning. However, WTI crude oil is now trading 0.9% higher at US$77.62 a barrel, while Brent Crude oil is also up 0.87% to US$83.40 a barrel, according to Bloomberg.

There has been some news impacting a key contractor for a Beach Energy gas project today. Clough Limited has been placed into voluntary administration with Deloitte as the administrator.

Clough is the engineering, procurement, and construction contractor for the Waitsia stage two project, a joint venture between Beach and Mitsui & Co Ltd, north of Perth.

Commenting on the news in a statement today, Beach said:

Beach and Mitsui E&P Australia (Mitsui), its joint venture partner and Waitsia operator, will work closely with the administrator, contractors, and stakeholders to ensure continued progress of the 250 TJ/day Waitsia Stage 2 gas plant.

Beach has been working with Mitsui in planning for various outcomes and will continue to work to deliver the best outcome for the project.

Meanwhile, Mitsui said it is too “early to speculate” on the impact on project. In a statement cited by Reuters, Mitsui said:

Given that an administrator has only just been appointed for Clough, it would be premature to speculate on the precise impacts for the Waitsia Gas Project Stage 2.

Share price snapshot

Beach Energy shares have soared nearly 53% in the past year, while they have gone up 42% in the year to date.

For perspective, the benchmark ASX 200 index has climbed 1% in a year.

Beach has a market capitalisation of more than $4 billion based on the current share price.

The post Here’s why the Beach Energy share price is diving 6% on Tuesday appeared first on The Motley Fool Australia.

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Motley Fool contributor Monica O’Shea has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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