Oil Search profits plummet due to PNG quake

12:08 pm on 22 August 2018

The profits of energy company Oil Search have dropped by nearly 40 percent after this year's devastating earthquake in Papua New Guinea halted operations at the company's project in the Highlands.

LNG Project facility, Hela Province, Papua New Guinea

LNG Project facility, Hela Province, Papua New Guinea Photo: RNZI / Johnny Blades

February's magnitude 7.5 quake in Hela province killed at least 180 people and caused widespread damage in the Highlands region.

The oil and gas company recorded a net profit after tax of $US79.2 million for the first half of 2018, down 39 percent from $US129.1 million recorded for the same period last year.

Production levels also fell by nearly a third due to the shutdown of the PNG LNG gas project, which Oil Search has a 29 percent stake in.

However, this loss was partly offset by soaring oil and gas prices, which managed to reduce the pressures of lower output.

Fairfax reported Oil Search managing director Peter Botten saying the company expected a much stronger second half of 2018 as all its PNG operations were back online.

The LNG Project was presently operating above pre-earthquake levels, Mr Botten said.

Earlier this month, Oil Search also signed a number of sales agreements for gas from its PNG LNG joint venture with ExxonMobil and Santos.

Oil Search has been involved in relief and recovery efforts for many communities affected by the earthquake.

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