UPDATE 1-Oil Search 2017 profit surges; outlines PNG expansion

(Adds PNG LNG expansion, executive quote)

Feb 20 (Reuters) - Australia's Oil Search on Tuesday reported a near threefold rise in annual core profit, underpinned by robust sales and rising oil and gas prices, and outlined a major expansion in Papua New Guinea.

Core profit for the year ended Dec. 31 rose to $302.1 million from $106.7 million a year ago, just off analysts' forecasts of around $310.3 million, according to Thomson Reuters I/B/E/S.

The Papua New Guinea-focused oil and gas producer declared a full-year dividend of 9.5 cents per share, up from 3.5 cents a year ago.

Oil Search is working with global giants ExxonMobil Corp and France's Total SA to develop new gas fields to expand exports from the PNG LNG plant run by ExxonMobil.

It said on Tuesday that the partners have broadly agreed on how they want to expand the project using gas from new and existing fields, and are set to propose three new LNG trains with a total capacity of 8 million tonnes a year.

The expansion would roughly double output from the PNG LNG plant.

"Oil Search has considerable discretion about when and how much to invest on other activities and will prioritize the development of its LNG expansion projects in Papua New Guinea and the Nanushuk oil field in Alaska," Managing Director, Peter Botten, said.

The firm said total revenue for the year rose 17 percent to $1.45 billion, driven mainly by a rise in oil and gas prices.

Average realized oil and condensate price rose 24 percent, while average realized LNG and gas prices were 21 percent higher for the year, the company said.

(Reporting by Ambar Warrick in Bengaluru; editing by Richard Pullin)