The National, Wednesday April 20th, 2016
OIL Search Limited has recorded a drop in total revenue by 9 per cent for the first quarter of this year.
In its quarterly report, Oil Search noted that total revenue for the quarter was US$313.1 million (K976.9m), compared to US$342.9 in the fourth quarter of last year.
It said there was a stronger sales volumes, particularly from the LNG, offset by a 19 per cent decline in average realised oil and gas prices.
It also maintained strong productions in the first quarter with total production of more than 7.7 million barrels of oil (mmboe), which was
3 per cent higher than the last quarter.
Managing director Peter Botten said the production results reflected a continued outstanding performance by the PNG LNG project and a stable contribution from the operating PNG oil fields.
Botten said their balance sheet remained strong with the company having US$914 million at the end of last month.
Despite the decline in realised oil and gas prices, the company generated material positive operating cash flows over the quarter to invest in its high-potential, growth activities.
“The Company’s cash flow break-even for 2016, including cash operating costs and interest payments, is expected to be approximately US$19 per barrel.
“At current oil price levels, Oil Search will generate sufficient cash flow to not only cover operating costs, all debt servicing (comprising scheduled semi-annual payments of principal and interest under the PNG LNG project financing facility) and sustaining capital expenditure but also surplus cash for reinvestment and return to shareholders.”