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Woodside Q2 production drops

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Pluto project still on track

Energy major Woodside Petroleum has attributed its June quarter drop in production to scheduled maintenance shutdowns, asset sales and a natural decline in oil production.

Woodside's second quarter production volume fell 10 per cent to 17.5 million barrels of oil equivalent, compared to 19.4mmboe in the previous corresponding period. The figure is nine per cent lower than Woodside's first quarter production this year.

In a statement to the Australian Securities Exchange, Woodside said the drop was "driven largely by scheduled maintenance shutdowns on North West Shelf Trains three and five, the sale of our Otway assets in the previous quarter as well as natural decline in oil production from Enfield and Neptune".

However revenues rose 48 per cent compared to 2009, at $1.2 billion, on the back of improved commodity prices.

Woodside said its Pluto LNG project remained within market guidance given in June and that work was continuing on schedule for front-end engineering and design at the site.

"The exploration drilling campaign to support Pluto's expansion continues to ramp up with the arrival of the second drilling rig in the Carnarvon basin," Woodside said.

"Final investment decision for Pluto expansion trains remains contingent on identification of economically viable gas resources either through exploration volumes and, or other resource owners."

Woodside said it expected the Pluto, Pluto expansion, Browse and Sunrise projects to remain under the existing petroleum resource rent tax (PRRT).

"While the North West Shelf Venture will move to PRRT, Woodside expects this regime to be no more onerous than the current royalties and excise regime under which the facilities currently operate.

"Discussions with the policy transition group to finalise details of the transition arrangements for the North West Shelf Venture have commenced."

Woodside, which is 34 per cent owned by Royal Dutch Shell, said its 2010 production would be in the range of 70-75mmboe, down from 80.9mmboe last year.