Beach Energy has cancelled its contract for the Ocean Onyx rig, which was due to drill production wells in the offshore Otway Basin.

Capital expenditure outlook for FY21 has not been revised, which means the company is targeting the deferral of up to 30% of planned expenditure.

Morgans assesses the business is well-positioned to rebound when oil prices recover. Add maintained. Target is reduced to $1.71 from $1.85.

Sector: Energy.

Target price is $1.71.Current Price is $1.34. Difference: $0.37 - (brackets indicate current price is over target). If BPT meets the Morgans target it will return approximately 22% (excluding dividends, fees and charges - negative figures indicate an expected loss).

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