Australia's Woodside flags $720 million charge on Kitimat assets in Canada

(Reuters) - Australia's Woodside Petroleum WPL.AX said on Tuesday it will record a $720 million charge in its fiscal 2019 results in relation to Kitimat liquefied natural gas assets in Canada.

Woodside said in September it would scale down its investment in the Canadian project to reduce capital expenditure. Woodside owns 50% of the Kitimat project, that is operated by Chevron CVX.N.

The U.S. oil and gas major reported a large fourth-quarter loss last month as it took around $10 billion in writedowns on properties that were no longer economical, including the Kitimat LNG assets.

“The impairment reflects increased uncertainty, particularly in the timing of the development of the upstream Liard resource, following sustained depressed gas market conditions in Western Canada,” Woodside said in a statement.

The Kitimat project encompasses upstream resource assets in the Liard and Horn River basins in northeast British Columbia and a natural gas liquefaction facility.

Woodside forecast higher output for fiscal 2020 in an operational update in January and said it has stepped up work on growth projects in a bid to triple its oil and gas reserves over a decade.

The company is due to report its results on Thursday.

(This story corrects to “$720 mln” from “$483 mln” in headline and changes currency to U.S. dollar from Australian dollar in paragraph 1)

Reporting by Anushka Trivedi in Bengaluru, editing by Louise Heavens