Oil price slump takes toll on Woodside as profit tumbles 99%
JOHANNESBURG (miningweekly.com) – Australia’s largest independent oil and gas company Woodside Petroleum on Wednesday posted a steep fall in full-year profit, despite achieving its second-highest production result.
After-tax net profit for 2015 reduced by 99% to $26-million, from $2.4-billion in 2014, driven by a sharp fall in commodity prices and asset impairments.
The company booked asset impairment charges of $1.08-billion in 2015, an increase on the $434-million reported in 2014, owing to the lowering of short- and long-term oil price assumptions. Woodside reduced its long-term pricing assumption by about 20%.
Prior to the deduction of one-off noncash items, the oil and gas producer’s 2015 statutory net profit after tax was $1.13-billion.
Revenue decreased by 36% year-on-year to $4.5-billion in the 12-month period, mainly a result of a 46% decrease in oil prices in the year.
Production dipped to 92.2-million barrels of oil equivalent, from its previous record of 95.1-million barrels of oil equivalent in 2014. Lower volumes reduced revenue by about $120-million.
Nevertheless, Woodside CEO Peter Coleman stated that the company was “well positioned to withstand the commodity cycle”.
He pointed out that Woodside’s cost of production was low. The company achieved an overall 8% year-on-year decrease in unit production costs in 2015, with a 7% decrease in gas unit costs and a 17% decrease in oil production unit costs. Since 2013, the total production cost had reduced by 14%.
Woodside’s production guidance for 2016 is between 86-million barrels of oil equivalent and 93-million barrels of oil equivalent.
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