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Santos sees slight upturn in production

Santos sees slight upturn in production

Photo by Bloomberg

17th April 2014

By: Esmarie Iannucci

Creamer Media Senior Deputy Editor: Australasia

  

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PERTH (miningweekly.com) – Australian oil and gas major Santos has reported a slight increase in production and sales for its first quarter ended March, compared with the previous corresponding period.

Production for the quarter was up 1% to 12.2-million barrels of oil equivalent, owing to higher oil production offset by lower gas production from Western Australia.

Gas production of 50.6 PJ, or 8.7-million barrels of oil equivalent, was 4% lower than the corresponding quarter, with higher production from the Darwin liquefied natural gas (LNG) and the Cooper basin operations offset by lower production from the Carnarvon basin, owing to lower customer nominations.

Crude oil production during the quarter reached 2.5-million barrels, down 15% on the previous quarter, as the higher production from the Chim Sao operation, in Vietnam, was offset by lower production from Fletcher Finucane, in Carnarvon, and the Cooper basin.

MD and CEO David Knox told shareholders on Thursday that the first quarter of 2014 saw the company build momentum for strong project delivery in the year ahead.

“The Papua New Guinea LNG project is progressing ahead of schedule, with first LNG cargo expected for the middle of this year. The project is currently over 95% complete, with first production of condensate from the Hides fields commencing in late March.”

The $19-billion Papua New Guinea LNG project’s gas would be transported by pipeline to a liquefaction plant with a capacity of 6.9-million tonnes a year, some 25 km from Port Moresby.

Knox noted that the Gladstone LNG project also continued to make progress, with the project remaining on budget and on track for first LNG production in 2015.

“The project is now 80% complete, with all train 1 modules delivered to Curtis Island, all mainline pipeline in the ground, the marine crossing tunnel complete and the pipeline installed.”

The project was expected to cost about $18.5-billion to develop, and the two LNG trains combined would have a nameplate capacity of 7.8-million tonnes a year.

“During the quarter, we also delivered the Peluang project, in Indonesia, ahead of schedule and on budget. Our other Asian project, the Dua oil project in Vietnam, is progressing well and remains on track for first oil in mid-2014,” Knox said.

Gas production from Peluang started in March this year, and the project was expected to deliver some 25-million standard cubic feet a day of gas.

Looking ahead to the full year, Knox remained confident that Santos would meet its production records, with the company expected to produce between 52-million and 57-million barrels of oil equivalent.

Edited by Creamer Media Reporter

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