Oil Search output falls

23 Oct 2012, 6:05 pm   -   Source: AAP

Petroleum company Oil Search is on track to meet its full year forecasts despite an oil spill causing a plunge in quarterly output.

Oil Search still expects to achieve its full year production guidance despite a minor oil spill and loading terminal shutdown contributing to a 26 per cent plunge in quarterly output.

The company, Australia's third largest oil and gas producer, produced 1.33 million barrels of oil equivalent in the three months to the end of September.

It was a 26 per cent fall on the previous quarter and 11 per cent retreat from the September quarter in 2011.

Oil sales revenue of 685,000 barrels was 57 per cent weaker and revenue was slightly offset by a higher average realised oil price of $US114.67 ($A111.60) a barrel but still 49 per cent weaker at $US107.8 ($A104.91) million.

The company expects production of 6.2 to 6.7 million barrels, having produced 4.59 million barrels for the first nine months of 2012, compared to 5.05 million barrels at the same time in 2011.

Oil Search had to suspend operations at its main producing fields in Papua new Guinea for most of August after an oil spill of up to eight litres at its Kumul Marine Terminal.

Bad weather hampered the investigation into the source of the spill, which was never found, and no spills have occurred since.

In better news, the company brough in French energy major Total earlier this month as a 50 per cent partner in five onshore and offshore gas exploration projects in the highly prospective Gulf of Papua region.

Oil Search is a 29 per cent partner in the $16 billion PNG LNG project due to begin production in 2014.

Oil Search shares were steady at $7.60.

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