April 16, 2019 / 12:29 AM / 4 months ago

UPDATE 1-Oil Search Q1 revenue falls on previous qtr as soft oil, gas prices hurt

(Adds P’nyang gas agreement timing, graphic, details)

April 16 (Reuters) - Australia’s Oil Search said on Tuesday its first-quarter revenue fell 21 percent from the preceding quarter, due mainly to the timing of liquefied natural gas (LNG) shipments and weaker oil and gas prices.

The Papua New Guinea-focused energy group reported revenue for the three months to March of $398.1 million, while production declined 3 percent from the December quarter to 7.25 million barrels of oil equivalent.

The company’s key focus remains on expansion plans for the PNG LNG project - with a 2020 sign-off in the works for the venture which is the resource-rich nation’s top revenue earner.

On Tuesday, it said a gas agreement for the P’nyang field is targeted for signing in the second quarter. P’nyang is a new field which would feed gas to a third train that Exxon Mobil plans to add at PNG LNG.

For the March quarter, realised oil and condensate prices fell 3 percent and the realised LNG and gas price was 7 percent lower than in the fourth quarter of 2018, Oil Search said.

Its first-quarter revenue was still up a 35 percent from the same period last year, when a devastating earthquake in Papua New Guinea crimped production.

Further out, China’s recent pledge to move away from coal will see the world’s No. 2 economy rely more on gas - an appealing prospect for Australian LNG exporters which have scaled up investment into new projects, anticipating the uptick in Asian demand.

Oil Search shares eased 0.9 percent in morning trade compared with a 1.5 percent decline in the Australian energy index.

(For an interactive graphic on Australia's LNG exports since March 2016 and revenue performance of Woodside, Oil Search and Santos, see tmsnrt.rs/2I8vdiS)

Reporting by Devika Syamnath in Bengaluru; editing by Richard Pullin

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