Bumper quarter lifts LNG project's revenue by 53 per cent
ORIGIN Energy had record sales from its $25 billion Curtis Island LNG project Australia Pacific LNG during the first quarter of 2019.
Sales revenue surged by 53 per cent to $763.9 million, defying some analysts' expectations that low oil prices would affect LNG exports.
The results were delivered in the global gas company's June quarter report, which chief executive Frank Calabria said were boosted by higher than expected gas prices.
The report, released this week, said APLNG's effective oil price during the March quarter was US$78/bbl.
It was an increase by $2/bbl in the previous quarter.
"This result was driven by continued reliable operational performance and higher realised commodity prices," Mr Calabria said.
"While gas sales to wholesale customers declined in the quarter, we directed additional gas to generation where it helped to meet peak summer demand in the electricity market."
The LNG project shipped 33 cargoes during the three months.
Owned by Origin, ConocoPhillips and Sinopec, APLNG has had sales worth $2.145 billion for the financial year to date, a 45 per cent increase in the first three quarters of last year.
"We had anticipated a greater hit to revenues from lower fourth-quarter 2018 oil prices in lagged contracts," RBC Capital Markets' Ben Wilson told Fairfax.
He said Origin's electricity and gas sales, reported on Tuesday, also beat his forecasts, with electricity sales in line but external gas sales higher, continuing the strength seen in the first half.
The increased revenue off the back of LNG sales follows concerns raised last year that the Curtis Island projects were troubled by an inability to reach full capacity.
EnergyQuest's December month-in-review report said low gas supplies prevented the three projects from reaching their full potential.
Chief executive Graeme Bethune said APLNG was the exception, as the only project out of the three plants to run at its expected capacity.
"APLNG is operating at a relatively high level of capacity (100 per cent), followed by QCLNG (93 per cent), which is also diverting gas into the domestic market and then GLNG (54per cent)," Dr Bethune said in January.
"GLNG is still aiming to achieve 6Mt of exports a year but the total original contracts were 7.2Mt and they've got quite a way to go to reach that."