By Robb M. Stewart
MELBOURNE, Australia--A rise in liquefied natural gas prices provided a modest lift to Woodside Petroleum Ltd.'s (WPL.AU) first-quarter sales revenue, offsetting a drop in production after operations in Australia's northwest coast were disrupted by a tropical cyclone.
Woodside, the country's biggest independent oil and gas producer, Thursday said revenue for the first three months of the year rose to US$1.22 billion from US$1.17 billion a year earlier, though it fell by 14% on the prior quarter.
The increase came despite a 2.1% drop in output year-over-year to 21.7 million barrels of oil equivalent, and a 9.9% slide from the final three months of 2018, as LNG output was dented by higher ambient temperatures due to tropical cyclone Veronica in late March, and an unplanned production interruption in February at the Pluto and Wheatstone LNG projects.
Increased output and a bump up in prices led to a 28% jump in Woodside's profit last year to US$1.36 billion, thanks largely to LNG operations in Western Australia where the company has run the North West Shelf project since 1984 and the Pluto LNG plant, which began producing in 2012. Woodside also benefited from a stake in Chevron Wheatstone LNG venture in Western Australia, which began exporting in 2017 and started shipping volumes from a second production line last June.
In the first quarter, Woodside received an average US$56 a barrel for its oil and gas, up from US$51 a year earlier with increases for LNG out of North West Shelf, Pluto and Wheatstone.
Woodside said the Wheatstone venture began domestic production of natural gas during the latest quarter.
After working to rebuild its resource in recent years, the Perth-based company is now focused on the development of its west-coast LNG facilities linking the Pluto and North West Shelf plants on the coast and build a hub which its expects will more than double its share of production by 2027. It has set a target of about 100 million barrels a year in 2020 in anticipation of tightening supply market across the industry and continued demand growth from countries including China.
Woodside has set a production target of between 88 million and 94 million barrels this year. Output grew by 8% last year to 91.4 million barrels, driven by a lift in LNG volumes.
Write to Robb M. Stewart at email@example.com