It’s all coming out in the wash as quarterly production reports reveal how much impact sliding oil prices have had on output for Aussie energy companies. It’s clear that share prices have taken a hit but so far production has stayed firm and its cost cutting that has been the focus.
Woodside Petroleum has reported record output and sales revenue and flagged plans to revise its investment expenditure. AWE has seen its quarterly production fall 16 per cent but still affirms its full year targets, Beach Energy took a hit flagging plans to cut capital expenditure by up to 20 per cent in the second half of the 2015 financial year and Santos has made record sales revenue and achieved higher gas production in the fourth quarter and in the year as a whole.
Economic News
US oil output is far from slowing with the Energy Information Administration reporting crude production was above 9 million barrels a day last week. Output hasn’t been this high in the US since the 80’s.
In Australia prices at the pump have been falling since the middle of last year with the weekly average price for a litre of unleaded at $1.10. In November last year prices were above $1.40/litre.
Production results
AWE Limited
(ASX:AWE) has seen its quarterly production fall 16 per cent but still affirms its full year targets. The oil and gas explorer says it produced 2.56 m barrels of oil equivalent in the first half and is on track to between 4.6 and 5.1 mmboe for the full year.
As the oil price continues to fall Beach Energy Limited
(ASX:BPT) has flagged plans to cut capital expenditure by up to 20 per cent in the second half of the 2015 financial year. The oil and gas producer’s lowered capital expenditure guidance now sits between a range of $430 million and $470 million over the full financial year. Annual production guidance has been revised to between 8.9 million barrels of oil equivalent and 9.4 million barrels of oil equivalent.
Beach Energy Limited
(ASX:BPT) reports Seven Group Holdings Limited
(ASX:SVW) has lifted its stake in the oil and gas producer. Media speculate the Kerry Stokes-led investment group secured between 3.5 per cent to 4.9 per cent of Beach Energy after the market closed yesterday and is eyeing an even bigger stake.
Oil Search Limited
(ASX:OSH) has posted record annual production but warned it is reassessing future spending plans in the wake of the oil price plunging to six-year lows. The company boosted oil output by 186 per cent to 19.27 million barrels of oil equivalent over the full 2014 calendar year. Revenue rose 110 per cent to $US1.61 billion.
Santos Limited
(ASX:STO) has made record sales revenue and achieved higher gas production in the fourth quarter and in the year as a whole. The gas miner says sales revenue for the fourth quarter was $1.1 billion with the full calendar year figure at $4 billion.
Senex Energy Limited
(ASX:SXY) has affirmed its annual production guidance, reported a fall in quarterly output and sales, and, cut its capital expenditure by 20 per cent. The oil and gas company’s output fell 5.3 per cent to 0.36 million barrels of oil equivalent in the December quarter and sales revenue dropped 33.5 per cent to $28.2 million.
Woodside Petroleum Limited
(ASX:WPL) has reported record output and sales revenue over the 2014 calendar year and flagged plans to revise its investment expenditure. The oil and gas producer increased production by 9.3 per cent to a record 95.1 million barrels of oil equivalent (mmboe) last year.
Fracking setbacks
AGL Energy Limited
(ASX:AGL) has voluntarily suspended pilot production testing at its Waukivory Pilot Project near Gloucester in New South Wales. The energy provider made the call after identifying toxic chemicals in flowback water taken from two of the four wells and from an aboveground water storage tank.
AGL Energy Limited
(ASX:AGL) says the latest water monitoring results show no detected levels of an anti-bacterial agent in groundwater around the Waukivory Pilot Project near Gloucester. The energy provider has tested groundwater and surface water samples for THPS from eight locations around the site before, during and after hydraulic fracturing operations.
Doing deals
Origin Energy Limited
(ASX:ORG) says Contact Energy Limited (NZE:CEN) will purchase between 22 and 26 petajoules of gas from Maui Development Limited. Origin holds a 53 per cent share in the New Zealand company Contact which says the gas deal covers two to three years and replaces an agreement that expired at the end of last year.
Oil Search Limited’s
(ASX:OSH) part owned $US19 billion PNG LNG project in Papua New Guinea is set for expansion. The project’s operator Exxon Mobil has inked a Memorandum of Understanding with the Papua New Guinea government for the development of domestic gas for electricity generation.
Liquefied Natural Gas Limited
(ASX:LNG) has seen its request for a US patent on its OSMR technology allowed by the US patent office. The LNG producer says it expects the patent to be granted in several weeks to cover its method and system for production of LNG.
Liquefied Natural Gas Limited
(ASX:LNG) is another step closer to financial close and first LNG in its Magnolia LNG project in the US state of Louisiana. LNG has signed EPC Joint Venture with Kellogg Brown and Root and SKE & C USA to deliver the four train project on a 70/30 per cent participation basis.
