Origin Prepares to Axe 350 Jobs by end-2013 amid Profit Slump

Origin Energy is preparing to cut 350 jobs by the end of this year in an attempt to contain costs, as a new forecast by the company shows that expected developmental spending for the Australian Pacific LNG (APLNG) will be $25.3 billion (AUD 24.7 billion), up $2 billion from its estimate released in July last year.

Origin noted that it has already cut 500 jobs in 2H 2012, and that by the end of the company's restructuring process, 850 jobs will be eliminated. A spokesperson told Rigzone Thursday that of the 500 jobs axed, around 370 of those were from Origin's energy markets business.

The company posted Thursday a net profit of $555 million (AUD 542 million) for the half-year ended Dec. 31, down 34 percent from $813 million (AUD 794 million) a year ago. Underlying profit for the same period was at $371 million (AUD 362 million), down 26 percent from $501 million (AUD 489 million) a year ago.

"The first half of the financial year was characterized by more challenging operating conditions in the energy markets segment, which impacted profit and cash flow," Origin's Chairman Kevin McCann, said in a statement.

"As Origin's existing business matures, it is important that we improve our operational effectiveness. We are focused on lowering our cost base, meeting competition more effectively and maximizing cash flow from our existing business. We [will] also continue to review our activities and close, discontinue or divest non-core assets, which will improve our available cash flow in the short to medium term," McCann added.

Origin disclosed Thursday that the APLNG coal seam gas to liquefied natural gas (LNG) project is progressing, with the upstream component of the project 29 percent complete and the downstream component 31 percent complete.

"Gathering locations for more than 960 wells – approximately 90 percent of wells required – have been scouted. Installation of gathering flow lines and electrical and fiber optic cables started in the second quarter of the 2013 financial year," Origin said in a separate statement addressing APLNG's progress.

"Construction of the first gas processing plant at Condabri Central Gas Plant was 60 percent complete in December last year and remains on track to be mechanically complete in mid-2013. Construction of the Condabri South and North gas processing facilities are also progressing to plan. The main pipeline is on track to be complete in early 2014. The Narrows Crossing, which is being executed by QCLNG, is progressing largely in accordance with its revised plan," Origin added.

The first 4.5 million tonnes per annum (mtpa) train will produce its first LNG cargo by mid-2015, while its second 4.5 mtpa train will be started up in 4Q 2015.

Quintella has reported on the upstream and downstream oil and petrochemicals markets from 2004. Email Quintella at quintella.koh@rigzone.com.

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Senex Strikes Gas at Unconventional Well in Cooper Basin

Senex has intersected 384 feet (117 meters) of net gas pay following the completion of drilling and casing of the Paning-2 unconventional gas exploration well in the onshore permit PEL 90, in the northern Cooper Basin.

Paning-2 is the first unconventional gas well to be drilled in the region and has confirmed the potential of the tight sands and deep coals to host material gas volumes.

The well drilled into a 13-square mile (36-square kilometer) structure – which Senex estimates to contain 2.1 trillion cubic feet of potential gas in place – and intersected 154 feet (47 meters) of net gas pay in the Permian tight sands and 230 feet (70 meters) in the deep coals of the Patchawarra Trough.

Senex's Managing Director Ian Davies noted that the result highlighted the untapped potential of the company's interests in the northern Cooper Basin.

"Paning-2 confirms the potential of the Patchawarra Trough and the northern Cooper Basin as a new province for unconventional gas exploration. Following the success of the well, we will continue to test for similar targets across the region," Davies said in the company's disclosure.

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Eni Awards Neptune Marine Services Blacktip Gas Field IRM Contract

Neptune Marine Services said Thursday that it has been awarded a contract from Italian major Eni to perform an inspection, repair and maintenance (IRM) scope in the Blacktip gas field, in the Bonaparte Basin offshore Australia in the Timor Sea on permit WA-279-P.

The Crest Odyssey 2, a saturation dive support vessel, will be used for the IRM scope, Neptune said in a statement.

The contract, expected to deliver $6 million, is due to start in March this year.

In 2001, Blacktip was discovered by the Blacktip-1 well, which flowed at a rate of 89 million cubic feet pre day principally from the Permian interval. The Transocean Sedco Forex jackup drilled the discovery well in 164 feet (50 meters) of water. Shortly after the discovery, the Eni-operated field was further explored and deemed commercially viable.

Blacktip holds an estimated 933 billion standard cubic feet of raw gas and 5.7 million barrels of condensate.

Quintella has reported on the upstream and downstream oil and petrochemicals markets from 2004. Email Quintella at quintella.koh@rigzone.com.

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Woodside's Net Profit Leaps to $2.98B on Strong Delivery from Pluto

Woodside Petroleum reported Wednesday a full-year net profit of $2.98 billion in the 12 months ended Dec. 31, up 97.9 percent from a year earlier.

The company, in its earnings statement, said that reliable production from its flagship Pluto project offshore Western Australia – started up in April last year – is the major contributing factor to its positive result.

"Pluto played a significant role in [the company's] profit result. The project contributed revenues of $1.4 billion and a gross profit of $642 million, for a part of year operations," Woodside's CEO & Managing Director Peter Coleman, said in a statement.

Woodside revealed Wednesday that it is moving ahead with the Browse LNG project, offshore Western Australia, as well as the Sunrise floating LNG venture in the Timor Sea. The company noted that it is in the midst of evaluating tender bids for onshore and offshore infrastructure for the Browse LNG project, while development for the Sunrise project is still in an early stage.

"At Browse, we continue to take a disciplined approach to the assessment of tender bids for offshore and onshore infrastructure to be in a position to consider a final investment decision by the end of June,"  Coleman noted.

"Onto Sunrise, we have had a number of productive technical engagements with the Timor-Leste Government in recent months. Although this engagement does not represent any agreement at this stage, we continue to build on dialogue with both governments to agree on a development which satisfies the requirements of all parties," Coleman added.

Woodside is also making a series of bold bets on projects in Israel and Myanmar.

The company reached an in-principle agreement in December last year to acquire a 30 percent participating interest in the 349/Rachel and 350/Amit petroleum licenses, which contain the mammoth Leviathan gas field offshore Israel.

"We are working with the Leviathan joint venture to finalize the agreement. This year, we also expect to be in a position to consider a final investment decision on a domestic gas development for the Leviathan field," Coleman disclosed.

In the fourth quarter of last year, Woodside's offers to acquire an interest in blocks AD-7 and A-6, offshore Myanmar; were also accepted. Entry into the blocks gives Woodside the opportunity to acquire 3D seismic in 2013/14, with options to drill exploration wells in subsequent exploration periods. AD-7 is operated by South Korea's Daewoo, while A-6 is operated by India's MRPL E&P.

"With potential investment spending at Browse and Leviathan, we have maintained $4.1 billion of available funds in the form of cash and undrawn debt facilities. The balance sheet is well positioned to support growth," Woodside's Executive Vice President and CFO Lawrie Tremaine, detailed his address focused on the company's funding facilities.

Quintella has reported on the upstream and downstream oil and petrochemicals markets from 2004. Email Quintella at quintella.koh@rigzone.com.

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Kreuz's Expanded Fleet Gives 430% boost to 4Q Profit

Singapore-listed Kreuz Holdings posted Friday a fourth quarter profit ended Dec. 31, 2012, of $5.7 million, up 430 percent from the same period last year. In 4Q 2011, Kreuz reported a net profit of $1.07 million.

For the full year ended Dec.31, 2012, Kreuz booked a profit of $39.6 million, up 49 percent from one year ago.

Kreuz said in its earnings report that the acquisition of a dynamic positioning construction class diving support vessel in April last year contributed to an increase in gross profit margin, as it reduced the company's reliance on third party vessels.

"The subsea sector is maintaining its current trend of continued growth in the shallow, medium and ultra-deep waters as subsea technology becomes an economically viable solution for increasingly remote or ultra-deepwater fields," the company noted in its disclosure.

"The high demand expected in the subsea sector along with the need to reinvigorate aging offshore fields augur well for Kreuz’s subsea construction and installation services, and inspection, repair and maintenance," the company added.

In the Southeast Asian region, oil-rich countries such as Malaysia and Indonesia are placing a renewed emphasis on reinvigorating their aging offshore oil fields. Both of these countries are also looking at promoting exploration deeper offshore and on their smaller oil fields.

Quintella has reported on the upstream and downstream oil and petrochemicals markets from 2004. Email Quintella at quintella.koh@rigzone.com.

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Regal Petroleum Spuds Ukraine SV-59 Well

Regal Petroleum plc announced the spud of the SV-59 well at its 100% owned and operated Mekhediviska-Golotvshinska and Svyrydivske (SV) gas and condensate fields in Ukraine.

The well has a target depth of 17,946 feet (5,470 meters), with drilling operations scheduled to be completed in December 2013 and, subject to successful testing, production hook-up by the end of the first quarter of 2014. The well is targeting the Visean reservoirs ("B-Sands").

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Tullow's Twiga South-1 Discovery Flows at 2,812 bopd

Africa-focused Tullow Oil unveiled results from flow tests at its Twiga South-1 oil discovery in Kenya, which showed a combined flow rate of 2,812 barrels of oil per day (bopd) from three reservoir zones.

In a statement released Thursday, Tullow added that the combined rate has the potential to flow at around 5,200 bopd. However, the company also said that its Ugandan Ondyek-1 exploration well did not encounter hydrocarbons.

Tullow said the Twiga South-1 results provide encouragement for the company's forthcoming testing program at Ngamia-1A on Block 10BB, where four zones are planned to be tested using the Weatherford 804 rig. Testing activities here are expected to begin in March and be complete by the end of May.

Meanwhile, the firm said Ondyek-1 well in Uganda has now been plugged and abandoned after it failed to find hydrocarbons but that it is carrying out further evaluation of the nearby Lyec-1 discovery, with the partners on block EA-1A reevaluating the remaining exploration potential of the area.

Tullow Exploration Director Angus McCoss commented in a statement:

"While it is still early days for our exploration campaign in Kenya, these flow tests results at Twiga South-1 are an important step on the way towards understanding the commercial potential of the two discoveries we have made so far. The Ondyek-1 well in Uganda did not encounter hydrocarbons but has contributed much to our understanding of the limits of the EA-1A block."

Tullow has a 50-percent operated interest in the Twiga South-1 well.

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Total, Wintershall to Invest $2.1B in Argentina Natural-Gas Production

BUENOS AIRES - France's Total SA and Germany's Wintershall AG will each invest about one billion U.S. dollars in Argentina over the next five years to boost natural-gas production, the Argentine government said in a statement Friday.

Total will invest $1.1 billion, while Wintershall will invest $1 billion in projects that will increase the country's annual natural-gas output by 3.1% between 2013 and 2017, according to the statement. Increased output from the investments is expected to total 12 million cubic meters per day.

Argentina is on a big push to try and attract investment in its energy sector to boost output.

Oil-and-gas production has declined in recent years while has demand soared, turning Argentina into a net energy importer and forcing the government to spend billions each year on gas and fuel imports. In 2011, Argentina spent more than $9 billion on imported energy.

Last year, the government nationalized a controlling stake in the country's leading oil-and-gas company from YPF SA from Spain's Repsol SA, accusing the company of bleeding YPF dry with dividends and failing to invest. Now, the government is pouring billions into expanding YPF's production.

Copyright (c) 2012 Dow Jones & Company, Inc.

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Anadarko Sets Capital Spending for 2013 at Up to $7.6B

Anadarko Petroleum Corp. unveiled capital spending plans for 2013 at $7.2 billion to $7.6 billion, as the energy producer seeks to put more funds into U.S. onshore and Gulf of Mexico projects.

The spending program is sharply higher than 2012's budget projections of $6.6 billion to $6.9 billion, which were disclosed last March.

"Following our highly successful 2012 exploration program where we nearly doubled our original targeted resources, we plan to be among the most active deepwater explorers in the world again in 2013," Chief Executive Al Walker said. "We expect to drill approximately 25 deepwater exploration and appraisal wells this year, including high-potential prospects in the Gulf of Mexico and three potentially play-opening international opportunities."

Anadarko plans to allocate most of its spending to U.S. onshore projects, accounting for 60% of the total budget, up from the 55% estimated for 2012. The company expects to increase U.S. onshore sales volumes by approximately 10% over last year, increasing sales of higher-margin oil volumes by approximately 30,000 barrels per day.

Gulf of Mexico projects are expected to take up 15% of the budget, up from 10% slated for 2012.

International projects should account for 15% of spending, down from the 25% set for last year.

Midstream and other spending will be 10%, the same level set for 2012.

Anadarko's operations in shale fields such as the Eagle Ford in south Texas and the Wattenburg in northeast Colorado have driven higher production in recent quarters. The company has also had a string of exploration successes off the coast of Mozambique.

The company this month said it swung to a fourth-quarter profit, compared with a prior year hit by charges tied to the 2010 Deepwater Horizon oil spill, though revenue declined as energy prices fell.

Copyright (c) 2012 Dow Jones & Company, Inc.

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