The Australian oil and gas producer today said production for the third quarter was 2.35 million barrels of oil equivalent (MMboe), down 7% on the 2.54MMboe produced in the second quarter.

The company said the drop in production was a result of cargo-loading issues in the Gulf of Papua, which led to the deferral of about 920,000 barrels of production, or 460,000bbl net to Oil Search.

“PNG production was disrupted during the quarter due to a suspension of loading operations at the Kumul terminal in August following very poor weather conditions in the Gulf of Papua and a minor spill,” managing director Peter Botten said.

He said as previously signalled to the market, full-year production is now expected to be below the company’s original 2006 guidance, at between 10.5MMboe and 10.8MMboe.

Oil Search said sales revenue for the quarter was $US141.8 million ($A187.68 million), some 1% higher than the second quarter.

The company said this carried sales revenue for the first three quarters of 2006 to $457.2 million.

Revenue was based on oil sales of 1.91MMbbl against production of 2.08MMbbl.

“Together with lower field interests, the production shortfall led to lower revenues than in the same period of 2005, despite excellent oil prices,” Botten said.