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- Despite a drop in production, Oil Search (OSH) reported a 16 per cent increase in first-quarter revenue thanks to steadily recovering oil prices
- Total production for the period came to 6.9 million barrels of oil equivalent — a 2.7 per cent drop compared to the prior three months
- Total revenue, however, jumped from US$259.5 million (roughly A$336.66 million) to US$301.5 million (roughly A$391.15 million)
- The average oil and condensate price realised during the first quarter of 2021 came to US$57.38 (roughly A$74.44) per barrel — a 42 per cent increase compared to the quarter before
- Oil Search is down 1.46 per cent to $3.72 per share
Despite a drop in production, Oil Search (OSH) reported a 16 per cent increase in first-quarter revenue thanks to steadily recovering oil prices.
Total production for the period came to 6.9 million barrels of oil equivalent — a 2.7 per cent drop compared to more than seven million barrels produced in the prior three months.
Total revenue, however, jumped from US$259.5 million (roughly A$336.66 million) in the December quarter to US$301.5 million (roughly A$391.15 million) in the March quarter, “strengthening oil prices and improving North Asian LNG spot market prices.”
According to this morning’s results, the average oil and condensate price realised during the first quarter of 2021 came to US$57.38 (roughly A$74.44) per barrel — a 42 per cent increase compared to the quarter before.
Other revenue, which includes infrastructure tariffs, shipping revenue, electricity and naphtha sales, also saw an increase of seven per cent to US$9.1 million (roughly A$11.81 million).
“Following on from our cost reduction and productivity programs in 2020, we are now embedding the initiatives into our business to ensure a sustainable continuous improvement culture,” said Keiran Wulff, Managing Director of Oil Search.
“We are strictly adhering to disciplined capital allocation to enhance our funding position as we approach the development periods of our world class growth assets,” he added.
While the company’s production guidance remains unchanged — at between 25.5 and 28.5 million barrels — its planned investment expenditure for 2021 has been cut from between US$325 million and US$445 million (roughly A$422 million and A$577 million) to between US$250 million and US$350 million (roughly A$324 million and A$454 million).
Oil Search said the overall cuts reflect cost savings and the effect of travel restrictions in PNG, while those specifically related to production reflect delays in major work programs — including the Kutubu Refinery rebuild — and deferred well planning activities.
As of March 31, the company held US$1.57 billion (roughly A$2.04 billion) of liquidity, consisting of US$676 million (roughly A$877 million) in cash and US$897 million (roughly A$1.16 billion) in undrawn credit facilities.
Oil Search is down 1.46 per cent to $3.72 per share at 10:34 am AEST.
