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UPDATE 2-Australia's Woodside, Santos say LNG on schedule, production near target
January 19, 2012 / 12:20 AM / 6 years ago

UPDATE 2-Australia's Woodside, Santos say LNG on schedule, production near target

(Recasts, adds detail)

* Woodside 2011 output 64.6 mmboe just above top end of guidance

* Santos Dec qtr production 11.7 mmboe, 2011 output at low end of f‘cast

* 2012 production forecasts unchanged

* Woodside’s Pluto LNG on track to come online in March 2012

* Santos’ Gladstone LNG makes “pleasing” progress

By Rebekah Kebede

PERTH, Jan 19 (Reuters) - Top Australian energy firms Woodside and Santos said their multi-billion liquefied natural gas export projects are progressing on schedule after reporting fourth-quarter production that dipped in line with forecasts.

Woodside’s A$14.9 billion ($15.5 billion) Pluto LNG export project expected to come online on schedule in March 2012, making it Australia’s first new LNG project to come online in six years.

“One of our significant growth projects will come to fruition in 2012 with the start-up of the Pluto LNG Project, providing a substantial boost to our already strong production base,” Woodside chief executive Peter Coleman said in a statement.

Construction at Woodside’s 4.3 million tonne per annum plant in northwestern Australia is in its final phases, with testing of equipment largely complete ahead of start-up, Woodside said.

The project is one of nearly $180 billion worth of liquefied natural gas export projects now under construction in Australia and are set to quadruple the nation’s LNG production by the end of the decade.

But the company is still searching for enough gas to expand Pluto, and is currently in discussions with gas resource owners about acquiring additional gas for the project’s expansion.

Woodside’s gas discoveries last year were expected to put the company in a position to move forward with the expansion, but some analysts estimate that Woodside will be able to move forward with expansion plans by the end of this year at the earliest.

Santos’ Gladstone liquefied natural gas (LNG) export project in Australia’s Queensland state is making “pleasing progress” and is still on schedule to deliver its first LNG cargo in 2015, despite a slowdown in drilling due to wet weather, the company said.

The $16 billion coal seam gas to LNG project will produce 7.2 mtpa for export.

The Exxon-operated PNG LNG, in which Santos holds a 13.5 percent stake is also on schedule for first LNG delivery in 2014.


Woodside said output was 16.6 million barrels of oil equivalent (mmboe) in the three months to December, down 9 percent on a year ago. Total 2011 output was 64.6 mmboe, above its forecast of 62-64 mmboe, excluding output from its Pluto LNG Foundation project.

The company reported A$4.8 billion in sales revenue for 2011, including record annual revenue of A$3 billion from its North West Shelf Project.

“It was generally a strong production quarter, the North West Shelf was strong again,” Ben Wilson, an analyst with JP Morgan, said, adding that was offset by Woodside’s decision to abandon the Xeres I well, which it had hoped would help it expand Pluto.

“It appears that they’ve had a reassessment of Xeres and decided the discovery is likely to be subcommercial.”

Santos said production was 11.7 mmboe in the three months to December, bringing 2011 output to 47.2 mmboe, down 5 percent from 2010 and at the lower range of its own 2011 output forecast.

But Santos’ sales revenue was up 14 percent to A$2.5 billion in 2011. Santos capital expenditure to be around A$3.75 billion, as stated in November.

Both companies left their 2012 production targets unchanged. Woodside maintained its forecast for production of between 73 million and 81 million barrels of oil equivalent in 2012 and Santos left its forecast at 51 to 55 mmboe.

Woodside shares were down 1 percent at A$33.76 at 0330 GMT. Santos shares rose 0.7 percent to A$13.31.

$1 = 0.9629 Australian dollars Additional reporting by Miranda Maxwell in Melbourne; Editing by Lincoln Feast

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