PERTH (miningweekly.com) - Australian oil and gas major Santos has reported a 31% decline in net profit for the 2012 financial year, with the miner writing down some $77-million in impairment charges.

Net profit for the full year reached $519-million after tax, compared with the net profit of $753-million in the previous financial year, which included gains on asset sales of $408-million, after tax.

Production for the full year was up by 10% to 52.1-million barrels of oil equivalent, upping sales revenue by 18% to a record $3.22-billion.

CEO David Knox said on Friday that Santos had delivered a strong set of financial results across its base business, with record sales revenue and underlying profit up 34%, to $606-million.

“Santos achieved its highest oil production in four years, strong operating cash flow, a material gas discovery at Crown and Australia’s first commercial production of gas from a shale well.”

Knox noted that the company’s production increases were driven by new assets in Western Australia and Vietnam, as well as strong production from the Cooper basin.

Crude oil production was up 33% to 9.5-million barrels of oil equivalent following the commissioning of the Chim Sao asset in Vietnam and higher Cooper basin production.

Natural gas production, in turn, was up 8% to 223 PJ, driven by record Western Australian production, which was partially offset by a lower net entitlement to Maleo gas production, in Indonesia, following a favourable gas price review.

“We expect a further lift in production in 2013,” Knox added.

“Our liquefied natural gas (LNG) projects are poised to deliver significant shareholder value and remain on schedule with PNG [Papua New Guinea] LNG on track for first LNG in 2013, and Gladstone LNG in 2015. Capital cost estimates for both projects remained unchanged.”

He added that Santos was also continuing to make good progress in its offshore oil projects, with construction of Fletcher Finucane ahead of schedule, and expected to start production by mid-year, and first oil from the Dua project expected in the first half of 2014.

For 2013, Santos was expected to produce between 53-million and 57-million barrels of oil equivalent, with the company spending some $4-billion on capital expenditure.