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Business |
OSL profit more than doubles
Shareholders to get
K0.13 dividend
By BAEAU TAI
MAJOR oil and gas concern Oil Search Ltd has more than doubled its
annual net profit.
Yesterday, it announced it was entering 2007 in extremely good
shape, with a production forecast of 10.5 to 11 million barrels of
oil equivalent (mmboe).
Net profit for last year was a record US$412 million (K1.2
billion), up 106%, helped by a net profit of US$258.4 million
(K807.5 million) arising from the sale of licence interests to AGL
Energy.
Core net profit excluding significant items was at a new record of
US$207.5 million (K648.4 million), up 4% on the 2005 result.
The petroleum producer and explorer said the result was achieved
despite lower production, after the sale of production assets to
AGL Energy.
Oil and gas production last year was 10.2 million barrels of oil
equivalent (mmboe) compared to 12.2 mmboe in 2005, with
approximately 2.5 mmboe sold to AGL.
The board will pay a final dividend of US$0.04 (K0.13), taking the
total payments for the year to US$0.08 (K0.26) a share, up 14%
from 2005.
The average realised oil price of US$67.22 (K210.06) per barrel
was 16% higher than in 2005, with Oil Search enjoying a premium to
the Tapis (benchmark) oil price, throughout the year.
“This premium increased in late 2006, due to enhanced marketing
efforts, following the assumption by Oil Search of crude marketing
responsibility for its PNG oil,” managing director Peter Botten
said yesterday.
During the year, there were a number of operating disruptions in
Papua New Guinea, resulting in the deferral of nearly one million
barrels of production into future years, but gross oil production
rose 5%, in the third successive year of production increases.
“Close scrutiny of production opportunities, including recent
success in the Usano field, indicates that it is likely that PNG
production can continue at around current levels (50,000 barrels
of oil per day) for at least a further three years,” Mr Botten
said.
“This may be further increased through exploration success, not
presently included in our forecasts.
“There are now more development opportunities identified in these
fields than in early 2006, so we remain confident of continuing
strong production from our PNG assets.
“We are entering 2007 in extremely good shape, with a strong
underlying oil production business and, as of this month, with
over US$500 million (K1.5 billion) in the bank,” Mr Botten said.
Yesterday, Oil Search’s shares fell A$0.02 to A$3.58
 
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