Progress continues on Australia Pacific LNG project and Origin outlook remains positive

Origin Energy Limited yesterday released the Quarterly Production Report for its Exploration and Production business for the quarter to 31 December 2012, reporting production of 29 petajoules equivalent (PJe) and sales revenues of $200 million.

When compared to the same quarter in 2011, production was 1 per cent higher as increased output from the Otway Basin more than offset the suspension of gas operations at Kincora in the Surat Basin, and a lower share of Australia Pacific LNG production due to the dilution of Origin’s ownership interest. Sales revenue also improved by 1 per cent due to higher average commodity prices.

Origin Chief Executive Officer Upstream, Mr Paul Zealand said, “We successfully completed a number of major planned activities at our production facilities during the half. BassGas, which had an extended shutdown for the Mid Life Enhancement project, returned to production in October, while planned inspection and maintenance shutdowns were successfully completed at the Otway gas plant in Victoria and Kupe gas plant in New Zealand. We have now completed all major maintenance shutdowns that were scheduled for the financial year,” he said.

While production for the quarter was steady, for the six months to 31 December 2012 production reduced by 5 per cent when compared with the prior corresponding half as a result of a dilution in Origin’s interest in Australia Pacific LNG, lower production from BassGas as a result of the Mid Life Enhancement project, the suspension of gas operations at the Kincora gas plant and lower customer nominations and plant availability at Kupe. Sales revenues for the half were $5 million lower at $425 million.

Significant progress continues on the Australia Pacific LNG project, and at the end of the reporting period, the Upstream component of the project was 29 per cent complete and the Downstream component 31 per cent complete. Origin was not required to make any cash contributions in the December quarter as a result of the Sinopec cash injection and the first draw downs from Australia Pacific LNG’s US$8.5 billion Project Finance facility. For the 2013 financial year to date, Origin’s cash contributions to the project total $119 million