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Woodside's First-Half Profit Rises, Confirms Output Outlook

Woodside Petroleum, Australia's largest independent oil and gas producer, reported a 10.6% rise in first-half net profit on Wednesday, due to higher output, and reaffirmed its 2007 production forecast.

Woodside said full-year output would be between 72-78 million barrels of oil equivalent (boe), a forecast first made in February. The company has downgraded its production outlook twice from an initial forecast of 90 million boe.

The Perth-based company said profit before one-off items was A$545.4 million (US$436.3 million) in the six months to June 30, below analysts' expectations of around A$557 million.

Reported net profit rose 16.3% to A$610.1 million, thanks to increased production and the sale of its equity in the Legendre field off western Australia, which helped to offset the negative impact of a stronger Australian dollar and higher depreciation.

Woodside, operator of the North West Shelf liquefied natural gas (LNG) project in Australia, saw total production in the first-half rise 17% from a year ago to 35 million barrels of oil equivalent.

Woodside, 34% owned by Royal Dutch Shell, said capital expenditure in the first six months was A$1.3 billion, up 30% from a year earlier due to increased appraisal and development activities, particularly on the Pluto and Browse liquefied natural gas (LNG) projects off Australia.

Woodside in July approved the 4.8 million ton per annum (mtpa) Pluto liquefied natural gas (LNG) project, which it has estimated will cost more than A$12 billion.

Woodside said it was evaluating options for the proposed 10 mpta Browse LNG project off the northwest coast of Australia and acquired two new exploration blocks adjacent to its existing Browse gas fields earlier this year.

Expansion of the fifth processing train at the North West Shelf project is facing cost pressures but the final cost is expected to be under A$2.6 billion, Woodside said. First LNG from the fifth train is expected by the fourth quarter of 2008.