Woodside books bumper quarter

Procurement work for Woodside Petroleum's Pluto LNG Train 2 has started, ahead of a final investment decision within weeks, as the company posted a 19 per cent lift in sales.

Woodside said today it had issued contractor Bechtel with a limited notice to proceed on engineering and procurement for the second processing train at Pluto, and to start early works for a Karratha accommodation camp to support the project's workforce.

The company also awarded a contract to Europipe GmbH for the trunkline pipe connecting the Scaborough field to Pluto.

Surging LNG prices drove Woodside to deliver a 19 per cent sales revenue increase during the September quarter despite a slip in production figures due to maintenance works.

Sales revenues for the period totaled $1.5 billion, with LNG sales clocking in 27 per cent higher than the preceding period.

LNG prices fetched $57 per barrel of oil equivalent while oil prices hit $80 per barrel, which helped to offset operational setbacks.

LNG production was hampered by planned maintenance and facility turnaround activities across most projects, including North West Shelf and Pluto LNG.

The company delivered production of 22.2 millions of barrels of oil equivalent for the three months to September, marking a 2 per cent decrease on the 22.7 MMboe attained in the prior quarter.  

Proposed sell-downs for Woodside’s Scarborough and Pluto 2 projects are underway with Pluto 2 set to be wrapped up in line with a final investment decision targeted later this year.

The first phase of Woodside’s Sangomar field development was at 38 per cent completion at quarter’s end and is on track for first oil in 2023.

Woodside’s proposed sell-down of its stake in the project is targeted between 40 per cent and 50 per cent.

Woodside chief executive Meg O’Neill said the company expects to see the benefit of stronger realised commodity prices in the fourth quarter.

“Global oil and gas prices have continued their upward trajectory, underlining the rebound in demand as economic activity has picked up in Asia and elsewhere, Ms O’Neill said.

“In addition, short-term gas hub prices in Europe and Asia have experienced unprecedented and sustained increases in both value and volatility with pricing indices in both markets recently reaching all-time highs.”

She said a final investment decision on the Scarborough and Pluto Train 2 developments was on track.

“All major contracts and Commonwealth and Western Australia primary environmental approvals to support an FID are now in place, and commercial agreements are approaching finalisation.”

Woodside made no changes to its full year production guidance of 90 to 93 millions of barrels of oil equivalent.

Woodside shares are down 2.32 per cent and trading at 23.95.