The production result was achieved on the back of start-up of the Bayu Undan liquefied natural gas, Maleo gas and Casino gas projects, although this was partially offset by the impact of cyclones on Western Australian oil production during the quarter.
Despite the increased output, sales revenue dropped 7% on the previous corresponding period to $580.9 million due to lower oil prices and a stronger $A/$US exchange rate.
But managing director John Ellice-Flint said this was still a strong first quarter result.
“Significant progress was also made during the quarter with the completion of a new export pipeline and installation of additional compression at the Fairview field, which will see coal seam gas production ramp up further during the second quarter,” he said.
“Since October 2005, Santos has doubled Fairview production from 27 terajoules per day (TJ/d) to 55TJ/d and our target is to lift production towards 70TJ/d during the second quarter.”
Ellice-Flint said the Cooper Basin Oil Project continued to deliver promising results, with a drilling success rate of 88% that “augers well for increasing oil production over the remainder of 2007”.
He said a new discovery well, Itchy-1, was brought online during the quarter, free flowing at about 1000 barrels of oil per day. This rate is expected to increase once an electric submersible pump is installed at the well.
Other highlights during the quarter included the award of two deepwater exploration blocks in the Bay of Bengal, India; signing a three-year, $90 million gas supply contract for the John Brookes gas field, off Western Australia; starting front-end engineering design (FEED) studies for the Henry gas field, offshore Otway Basin, and the Kipper gas field, offshore Gippsland Basin; and signing a Papua New Guinea LNG cost-sharing agreement with ExxonMobil and Oil Search.
As of December 31, 2006, Santos said it has recorded a net provision of $A67 million for the East Java mudflow disaster caused by the Banjar Panji gas well, in which it holds an 18% stake.
