Oil Search revenue climbs on higher LNG prices

Oil Search, the owner of a 29 percent stake in the ExxonMobil-operated PNG LNG project, said its third-quarter revenue rose 16 percent on higher LNG prices.

Revenue rose to US$309.5 million in the third quarter of this year from $267.7 million in the June quarter.

“The average realised oil and condensate price of US$47.24 per barrel was slightly lower than in the second quarter, but the average realised LNG and gas price was 23% higher, at $6.44 per mmBtu, due to the approximate three month lag between oil and LNG pricing,” Oil Search said in its quarterly report on Tuesday.

Total production in the third quarter of 2016 was 7.63 million barrels of oil equivalent (mmboe). According to the report, this was 6% higher than in the second quarter and the second highest quarterly production in Oil Search’s history.

Production guidance for the full year remains unchanged (6.3 – 6.7 mmboe), Oil Search said, adding that production is currently trending towards the upper end of the range.

However, the company slashed its capital cost guidance which was previously expected to be in range of $270 – 315 million.

Capital cost guidance is now expected to be approximately 12% lower ($240 – 275 million), reflecting the “deferral of production capital and some pre-FEED activities into 2017 and lower than expected PNG LNG Project capital spend.”

LNG World News Staff