Origin Energy produced the second encouraging December quarter statement from an energy group yesterday after Beach upgraded its output guidance by 10%.
Origin reported a sharp rise in sales revenue at its jointly owned LNG project in Queensland, but offset that with news of a sharp fall in gas and electricity sales in the quarter.
Electricity and gas sales fell the quarter, with retail sales slipping nearly 20% in volume and natural gas levels plummeting 57%, the better performance at APLNG in Queensland has allowed Origin to retain its annual earnings forecast guidance of between $1.5 billion and $1.6 billion.
APLNG posted record revenue in the December quarter, up 45% on the previous year on higher LNG and oil prices and a weaker Australian dollar.
Origin’s share of revenue from the 35% owned Australia Pacific LNG (APLNG) was $741 million in the 2018 December quarter, up 16% from $640 million in the previous three months, and up 45% on the 2017 December quarter’s $510 million.
The leap came despite gas sales increasing only 1% quarter-on-quarter and falling 4 percent year-on-year, and stable production.
APLNG’s record revenue resulted from a rise in the average realised oil price to $US76 a barrel in the December quarter, from $US69 a barrel in the previous quarter, as well as a weaker Australian dollar.
The oil price hit a ceiling of $US86 a barrel in October before it fell sharply to around less than $US50 a barrel in late December. It has since recovered to around $US53 a barrel The LNG price is linked to oil prices.
“Australia Pacific LNG benefited from both higher commodity prices and favourable movements in the exchange rate, while continuing to operate reliably at steady-state production levels,” Origin chief executive Frank Calabria said in yesterday’s statement.
APLNG is a joint venture between Origin, ConocoPhillips of the US and China Petroleum & Chemical Corp.
Origin shares ended down 0.1% at $7.16 after rising as high as $7.38.
