INTERVIEW-UPDATE 1-AWE sees fall in FY09 output, profit

* sees FY 09 production down about 10 pct as Tui declines

* expects profits "substantially lower" this year

* shares fall as much as 5.8 pct in broader market up 1.6 pct

(Adds details, background)

By Fayen Wong

PERTH, Jan 28 (Reuters) - Australian Worldwide Exploration Ltd (AWE.AX)(AWE) will see production fall by about 10 percent in fiscal 2009 on weaker output from its main field, while the drop in oil prices will hurt its profits, the oil and gas company said on Wednesday.

But AWE Chief Executive Bruce Wood said the firm remains committed to growing its production portfolio in the medium term through exploration and acquisitions around the region, adding that the firm was willing to spend several hundred millions to venture into new production areas.

"Production will be lower this year," Wood told Reuters in an interview. "Our prime asset, the Tui field, is declining."

The decline is also a result of having about 400,000 boe of production from Arc Energy's assets being discounted in statutory reporting due to a 6-week transitional period in the transfer of ownership, Wood said.

AWE, which bought smaller rival Arc Energy Ltd for A$510 million last year, had forecast output for the year to June 30, 2009 to be broadly steady from a record 9.9 million barrels of oil equivalent (boe) in the previous year.

Weaker output, combined with the recent collapse in global oil prices, will also drag the firm's net profits "substantially lower", Wood said.

AWE's net profit surged to A$264 million ($175 million) in fiscal 2008, from A$35.4 million the year before, as production from the Tui oilfield off the coast of New Zealand came onstream and thanks to soaring world oil prices.

Analysts on average expect AWE's 2009 operating profit to fall to A$217.8 million, according to a poll of eight brokerages by Reuters Estimates.

Wood declined to comment on the forecasts, but said that AWE would not be alone in the sector to suffer from weaker earnings.

Shares in AWE, which has a market capitalisation of around A$1.3 billion, fell 4.3 percent to A$2.46 by 0442 GMT, versus a S&P/ASX 200 index .AXJO up 1.6 percent.

The stock has nearly halved in value since striking a peak of over A$4.71 a share last May, hit by the global financial crisis and a dive in oil prices, which have tumbled over $100 since striking a record $147 in July.