PERTH (miningweekly.com) – Oil and gas major Santos has reported its highest quarter production in seven years during the period ended September, with the ramp-up of the Papua New Guinea liquefied natural gas (PNG LNG) project driving production.
During the quarter under review, Santos production increased to 14-million barrels of oil equivalent, up 9% on the previous quarter and up 4% on the previous corresponding period.
Santos MD and CEO David Knox said that the production result was the company’s highest quarterly production result since 2007.
The PNG LNG project reached full capacity in late July this year, and 23 LNG cargoes were shipped from the project during the quarter ended December.
More than 700 km of pipeline connect the $19-billion PNG LNG facilities, which include a gas conditioning plant in Hides, and liquefaction and storage facilities near Port Moresby with a capacity of 6.9-million tonnes a year.
Quarterly crude oil production reached 2.4-million barrels, up 13% on the previous quarter, primarily owing to higher production in Vietnam from the Chim Sao operation, and the commissioning of the Dua project, combined with higher production in Western Australia.
Meanwhile, sales for the third quarter ending September were also up by 8% compared with the previous corresponding period, to 16.8-million barrels of oil equivalent, and above the 15.1-million barrels achieved in the second quarter.
Sales revenue for the period was up by 3% on the September quarter of 2013, to $1.06-billion, and up on the $974-million reported in the quarter ended June. Crude oil sales accounted for $470-million of the revenue during the quarter, 3% lower than the previous quarter owing to lower realised oil prices, partially offset by higher sales volumes.
Santos has maintained its production outlook for 2014 at between 52-million and 57-million barrels of oil equivalent.
Meanwhile, Knox noted that the Gladstone LNG (GLNG) project was approaching the 90% completion mark, and remained on budget and on track to deliver its first LNG in 2015.
The $18.5-billion GLNG project is 30% held by Santos, with Petronas and Total each owning a 27.5% interest and Kogas the remaining 15%.