UPDATE 1-NZ Oil and Gas H1 profit leaps, to pay dividend

(Updates with company comment, share price)

WELLINGTON, Feb 27 (Reuters) - Energy company New Zealand Oil and Gas Ltd (NZO.NZ) reported a jump in first-half net profit, after its Tui oil field began production, and said the larger-than-expected field would lift future profits and allow dividend payouts.

Shares in the company jumped 8 cents or 5.8 percent to a six-month high of NZ$1.27 on the result, and last traded up 4.2 percent at NZ$1.24.

But the company, which announced its first dividend in 10 years, said volatile oil and currency markets meant it could not accurately forecast how big the profit increases would be.

NZOG posted a net profit for the six months to Dec. 31 of NZ$41.4 million ($33.7 million), compared with a profit of NZ$0.5 million last year.

Chief Executive David Salisbury said forecast earnings before interest, tax, depreciation and amortisation (EBITDA) of NZ$30 million in 2009, rising to NZ$50 million in 2010, made last June were out of date.

"They not only look conservative, we've already exceeded them by quite a margin this year," Salisbury told a media briefing, adding latest estimates put the Tui resource at 42 million barrels, 50 percent larger than its pre-development forecast.

The Tui field, in which NZOG is a junior partner, is located off the west coast of New Zealand's North Island. Australian Worldwide Exploration Ltd (AWE.AX) is the operator of the field and has a 42.5 percent stake.

NZOG said it would pay a dividend for the full year of 5 cents a share, the first since 1998, and in future would pay a reasonable amount of profit by way of an annual dividend.

Because of the uncertain level of returns combined with the possibility of re-investing profits in exploration, Salisbury would not give a likely range for future dividend payments.

"It will tend to lead to a bit of variability in the terms of the payout," Salisbury said, adding there was no guarantee of a payout next year.

The company also has a stake in the Kupe field, which will begin production in 2009, and has interests in exploration permits for two areas.

It holds 35 percent of the Pike River Coal mine (PRC.NZ), which floated in July last year and is due to begin production in the second half of 2008.

Revenue for the half-year was NZ$95.5 million, compared with NZ$92,000 the previous year.

Salisbury said the company had all of its current funding needs in place for production and exploration. (NZ$1=$1.23) (Reporting by Adrian Bathgate; Editing by James Thornhill)