Origin Sees Record Oz APLNG Revenue, Production in 4Q

Australian Origin Energy’s share of revenue and upstream production from the Australia Pacific LNG (APLNG) project hit record levels in April-June (4Q), while its LNG volumes slid, the company said July 31 in its quarterly report.

“Australia Pacific LNG continues to perform well and is making an increasingly important contribution to Origin,” Origin CEO Frank Calabria said.

The company’s total share of APLNG revenue was A$570.2 million ($423.72mn), which is up 23% year on year and 14% from Q3. It’s share of production stood at 64 PJ, which is up 4% year on year and 2% quarter on quarter.

Origin holds a 37.5% interest in APLNG, along with ConocoPhillips (37.5%) and Sinopec (25%). The facility, which is based at the Port of Gladstone in Queensland has two 4.5mn metric tons per year capacity trains.

The lift in Origin’s share of total production from APLNG was driven by an increase in gas used to meet domestic demand, while the LNG export volume fell.

Gas for domestic production was 21.30 PJ, up 40% year on year and 35% quarter on quarter while the LNG volumes fell to 711,900 mt, down 14% from a year earlier and 9% from the prior quarter, the report showed.

“Planned maintenance was successfully completed in April with Train One shut down for sixteen days. During the shutdown, excess upstream gas volumes were directed into the domestic market,” Origin said.

There are three more separate downstream maintenance shutdowns due for 1Q FY2019, with each resulting in a half-train outage for approximately one week, it added.

RBC Capital Markets analyst Ben Wilson said Origin’s APLNG revenue for the quarter was lower than what RBC had been expecting due to the lower LNG volumes.

“Production and sales at the aggregate APLNG level (domestic plus LNG) were consistent with our forecasts, likewise received LNG pricing. The lower than expected product revenue figure is a result of an unfavourable product mix, with less LNG offset by more lower-value domestic sales than forecast,” he said.

RBC had been expecting revenue of A$603mn, LNG of 802,000 mt and domestic production of 18.4 PJ, he said.

Origin’s average LNG price was $9.3/MMbtu during 4Q, up 33% year on year and 15% higher than 3Q. The average natural gas price was A$5.10/GJ, up 37% from the year prior and 13% higher quarter on quarter, the results showed.