Woodside Petroleum’s production and sales grew in the first quarter of 2016 over the same quarter in 2015, but sales revenues were down 30.3% at US$982 million. The company announced its results on April 20.
Production was 23.7 million barrels of oil equivalent in the quarter, down from 24.9 million boe in the fourth quarter of 2015 but up on the 21.8 million boe recorded for the first quarter of 2015. Sales revenues of US$982 million were down from the US$1.1 billion in the previous quarter and the US$1.41 billion recorded in the first quarter of 2015.
Output fell over the previous quarter largely as a result of lower oil production. The year-on-year growth came about from higher volumes at Pluto LNG, which reached an annualised equivalent of 4.8 million tonnes per year in the quarter. This exceeds the production targeted from the plant when it was approved, in 2007, when Woodside had assumed output would be 4.3 million tonnes per year.
“We are taking advantage of market conditions and applying latest technology to reduce life cycle costs, further enhancing our position as a low-cost operator,” said Woodside’s CEO, Peter Coleman. “This will also improve project concepts to deliver a portfolio of globally competitive decision-ready projects.”
Pluto’s sales revenue from LNG reached US$516.1 million in the first quarter, down year on year from US$712 million. North West Shelf (NWS) revenues were US$211.4 million, down from US$342.8 million in the first quarter of 2015. Furthermore, LNG processing revenue was US$48.9 million, marginally up from US$45 million.
During the quarter, Woodside took the decision not to go ahead with its Browse floating LNG (FLNG) project. The company, in late March, said the three-unit facility was not justified as a result of current market conditions. FLNG remains the preferred way in which to develop the resource, the company said.
Instead of investing in new projects, Woodside is working on securing additional resources for existing facilities. As such, the company has entered front-end engineering and design (FEED) work to tie in the Equus field to its NWS facility. Equus is being developed by Hess, with a final investment decision (FID) expected in mid-2017.