Higher Production Not Enough To Offset Lower Prices At Woodside

By Glenn Dyer | More Articles by Glenn Dyer

A day after revealing over $US6 billion in asset write-downs, Woodside Petroleum has revealed record production for the June quarter and half year, but not it seems for revenues.

But that wasn’t enough to offset the slide in world LNG prices and the company revealed sharp falls in quarterly and half-year revenues from its oil and gas sales.

Sales slid by more than 26% in the June quarter to $US768 million, from over $US1.11 billion in the three months to March. Sales were down by only $US31 million from the June quarter of 2019 when they totalled $US836 million.

For the six months to June, sales fell 15% or $US343 million to $US1.917 billion.

The reason was the hit to LNG revenues from a larger than expected volume of gas having to be sold into the weak spot market.

Woodside said it had record production of 25.9 million barrels of oil equivalent (MMboe), up 7% from the March 2020 quarter, which produced a record first-half output of 50.1 MMboe, up 28% from the first six months of 2019.

Sales in the quarter rose 13% to 27.1 MMboe from the March quarter’s 23.9 MMboe and

For the June quarter, the average realised price for Woodside’s products was $US28 per barrel of oil equivalent, down from $US45 per barrel it earned in the quarter ended March 31.

The company also said it was targeting final investment decisions for its Scarborough and Pluto Train 2 projects in the second half of 2021.

In March, Woodside had deferred final investment decisions for Scarborough, co-owned by global miner BHP Group, and its Pluto LNG expansion to 2021. It had earlier targeted go-ahead decisions for the twinned projects in mid-2020.

Woodside will report its first-half fiscal 2020 earnings on August 13.

Glenn Dyer

About Glenn Dyer

Glenn Dyer has been a finance journalist and TV producer for more than 40 years. He has worked at Maxwell Newton Publications, Queensland Newspapers, AAP, The Australian Financial Review, The Nine Network and Crikey.

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