Oil Search Profit Up On Oil Price, Eyes PNG LNG Expansion
February 20 2012 - 6:38PM
Dow Jones News
Oil Search Ltd. (OSH.AU) on Tuesday booked a stronger annual
profit owing to higher oil prices, and said its US$15.7 billion PNG
LNG venture with ExxonMobil Corp. (XOM) could know by the end of
2012 if it has enough gas for an expansion.
Oil Search's net profit for the year to Dec.31 rose by 9% to
US$202.5 million from US$185.6 million.
Excluding a previously announced US$33.2 million impairment
charge on an oil block in Kurdistan, net profit rose to US$235.7
million from US$144.1 million, beating the US$228.4 million average
of eight analyst forecasts compiled by Dow Jones Newswires.
Exxon, Oil Search and other partners including Australia's
Santos Ltd. (STO.AU) already have enough gas to underpin
construction of the foundation stage of PNG LNG, which is expected
to ship its first cargoes of liquefied natural gas to Asian
customers in 2014.
As anticipated by some analysts, Oil Search said Tuesday that
initial Hides exploration drilling to support a possible expansion
of the project has been pushed back until mid-2012, from an
original timetable of the end of the first quarter.
"A preliminary view on whether enough gas is available to
underwrite an expansion or whether additional activities are
required is likely to be formed in late 2012/early 2013," Oil
Search Chief Executive Peter Botten said in a statement.
Another well that could factor into the expansion effort,
P'nyang, is currently drilling and will be immediately followed by
another, Trapia.
Oil Search also has extensive gas prospects in the Gulf of
Papua, which it hopes could support construction of another
gas-export venture. It intends to drill its first well there in the
last quarter of 2012.
"Oil Search has received strong interest in participating in
this programme from a number of major companies with LNG
development experience," Botten said, without naming any
companies.
-By Ross Kelly, Dow Jones Newswires; 61-2-8272-4692;
Ross.Kelly@dowjones.com
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