Moller-Maersk Net Profit Falls, Demand to Stay Subdued

The world's largest container shipping company A.P. Moller-Maersk A/S Friday posted a smaller-than-expected drop in first-quarter net profit, supported by increased freight rates and efficiency measures at its main shipping unit, but said it expects container transport demand to remain subdued this year amid "challenging" conditions.

Last year's earnings were boosted by the settlement of a tax dispute in Algeria.

The Danish shipping and oil conglomerate said it is maintaining its full-year guidance, expecting a result for 2013 below that of 2012 of $4 billion, while the net result excluding exceptionals is expected to be in line with the 2012 figure of $2.9 billion.

"Global demand for seaborne containers is expected to increase by 2%-4% in 2013, lower on the Asia-Europe trades but supported by higher growth for imports to emerging economies," the company said.

Indications for the first quarter of 2013 "show modest improvements in the global demand for container transport, reflecting the weak economic situation, especially in developed countries."

"Demand is expected to stay subdued in 2013 while capacity will grow significantly. Accordingly, conditions for the container industry remain challenging and managing supply will be even more important this year," it said.

The company posted a first-quarter net profit of 4.01 billion Danish kroner ($693 million), beating analyst expectations of DKK3.4 billion. In the year-earlier period, the company recorded a net of DKK6.15 billion.

Revenue was lower than expected, dipping 2% to DKK79.32 billion, from DKK81.31 billion in the year-ago period. Analysts had forecast revenue of DKK82.32 billion.

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Apache 1Q Profit Falls 10% Amid Weak Commodity Prices

Apache Corp. said it would seek to sell $4 billion in assets this year, doubling its divestiture program as the U.S. oil and gas company tries to pay down debt and boost its stock price.

The move by the Houston company follows similar strategies by Chesapeake Energy Corp. and other independent energy producers, which expanded aggressively during the recent energy boom but now are scaling back. Apache, which engaged in acquisitions in the deep-water U.S. Gulf of Mexico and other places, now plans to focus on production in onshore North America, which it thinks will provide the best return, and jettison land that has turned out less profitable than first hoped. Apache declined to say, however, which assets were on its sales list.

"We've spent the past several months going through assets to see which to keep and which would be worth more to others," Chief Executive Steven Farris said during a call with investors. "The asset list we have generated, at today's prices, would exceed $4 billion."

Apache plans to use the first half of the expected proceeds to pay down its debt. The company reported $11.5 billion in long-term debt for the first quarter, up from $7.4 billion a year ago, partly because of the $3 billion debt-financed acquisition of West Texas energy producer Cordilla Energy Partners III LLC in May 2012 and a $2 billion debt offering in November.

The remaining $2 billion will go toward buying back up to 30 million Apache shares, the company said.

Investors who had been worried that Apache was taking a hands-off approach to share price cheered the announcement. Apache shares climbed 4.2% to reach $81.04 in recent trading, the first highest price since February.

"See, management does care," Wells Fargo analyst David Tameron said in a note to clients.

Apache had been said to be trying to sell properties in the U.S. Gulf Coast, The Wall Street Journal reported in April, citing people familiar with the sales plan. Apache drills globally, with operations in Australia, Alaska, Canada, Egypt and offshore England.

Apache wants to focus more of its efforts on onshore drilling in the U.S., which accounted for more than a quarter of its daily oil and gas output of 781,819 barrels in the first three months of this year, the company said.

Apache's share buyback plan helped turn attention away from what had been a weak first quarter. Apache reported Thursday a profit of $698 million, or $1.76 a share, down from $778 million, or $2 a share, a year earlier. Excluding merger-and-acquisition expenses, asset write-downs and other items, adjusted earnings were down at $2.02 from $3. Revenue fell 10% to $4.08 billion.

Output in Egypt declined by 2%, to 365.6 million cubic feet a day. Mr. Farris told investors The production decline, plus worries about civil unrest in the region, "has had some impact on our stock price."

Analysts polled by Thomson Reuters most recently projected earnings of $2.21 on revenue of $4.31 billion.

Production rose 1.6% to 781,819 barrels of oil equivalent a day, driven by a 45% increase in North American onshore liquid hydrocarbons output.

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BG 1Q Profit Down on Lower Production

LONDON - BG Group PLC said Thursday its first-quarter net profit was down 0.8% on lower production and increased costs in exploration and production, but said it had delivered three key milestones on projects in Brazil and the U.K. 

The company, which last year surprised the market by downgrading its production targets, said it was on track to meet its project milestones for this year. 

The U.K.'s third-largest oil and natural gas company by market value said net profit for the three months ended March 31 totaled $1.21 billion, compared with $1.22 billion for the first quarter of 2012. 

"We have made a good start to the year, delivering the three key milestones for the first quarter, whilst also making progress with our project execution program for the year," said Chief Executive Chris Finlayson. 

Excluding gains or losses from one-off items, such as asset sales, the company's profit was $1.18 billion, down 3.4% from $1.23 billion in the same period a year earlier. This was 6.1% above average expectations of $1.12 billion in a Dow Jones Newswires poll of six analysts. 

Total oil and gas production was 659,000 barrels of oil equivalent a day, a 1.5% fall from the same period a year ago, but slightly above analysts' expectations of 648,000 barrels of oil equivalent a day. 

Revenue for the quarter was up 0.6% to $4.91 billion from $4.88 billion a year ago. 

Diluted earnings per share were 35.3 cents compared with 34.2 cents the previous year.

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ConocoPhillips First-Quarter Profit Off 27% on Spinoff, Divestitures

ConocoPhillips' first-quarter earnings fell 27% after the exploration and production company reported lower revenue amid the spinoff of its refining and marketing arm in 2012 and as the year-earlier period benefited from $950 million in asset sale gains.

ConocoPhillips reported a profit of $2.14 billion, or $1.73 a share, down from $2.94 billion, or $2.27 a share, a year earlier. The year-earlier period included a $712 million income contribution from ConocoPhillips former refining and marketing arm, which was spun off as Phillips 66 nearly a year ago as part of the multiyear revamp aimed at improving the company's finances.

Excluding asset write-downs, asset-sale gains, spinoff-related expenses and other items, adjusted earnings from continuing operations were up at $1.42 from $1.38. Revenue decreased 8.9% to $14.65 billion.

Analysts polled by Thomson Reuters had most recently projected earnings of $1.41 on revenue of $13.57 billion.

The newly independent exploration and production company is in the midst of a three-year repositioning in which the oil major has shed billions of dollars in assets and is planning to divest itself of more operations as it seeks to focus on fast-growing shale plays in the U.S.

Average daily production fell 1.6% amid the asset sales and the company warned that it will likely fall further in the second quarter.

ConocoPhillips executives had said at the end of the 2012 fourth quarter that 2013 would be a low point for the company's production, as it aims to refocus its efforts on North America while shedding other international assets.

But the company reported that in the Eagle Ford, Bakken and Permian basins, unconventional U.S. reservoirs that ConocoPhillips expects to be drivers of its future growth, combined production climbed 42%.

Simmons and Co. analysts said the ConocoPhillips exceeded expectations with low corporate charges and "well-behaved" productions.

"Overall, results were better than we had expected, and in-line to better than the street had expected as well," they wrote.

Chairman and Chief Executive Ryan Lance said the company is on track to grow production and improve margins this year, pointing to discoveries in the Gulf of Mexico last quarter.

"Our base business is operating to plan, our development programs and major projects are performing as expected and we are on track to deliver production and margin improvements this year," he said.

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ConocoPhillips First-Quarter Profit Off 27% on Spinoff, Divestitures

ConocoPhillips' first-quarter earnings fell 27% after the exploration and production company reported lower revenue amid the spinoff of its refining and marketing arm in 2012 and as the year-earlier period benefited from $950 million in asset sale gains.

ConocoPhillips reported a profit of $2.14 billion, or $1.73 a share, down from $2.94 billion, or $2.27 a share, a year earlier. The year-earlier period included a $712 million income contribution from ConocoPhillips former refining and marketing arm, which was spun off as Phillips 66 nearly a year ago as part of the multiyear revamp aimed at improving the company's finances.

Excluding asset write-downs, asset-sale gains, spinoff-related expenses and other items, adjusted earnings from continuing operations were up at $1.42 from $1.38. Revenue decreased 8.9% to $14.65 billion.

Analysts polled by Thomson Reuters had most recently projected earnings of $1.41 on revenue of $13.57 billion.

The newly independent exploration and production company is in the midst of a three-year repositioning in which the oil major has shed billions of dollars in assets and is planning to divest itself of more operations as it seeks to focus on fast-growing shale plays in the U.S.

Average daily production fell 1.6% amid the asset sales and the company warned that it will likely fall further in the second quarter.

ConocoPhillips executives had said at the end of the 2012 fourth quarter that 2013 would be a low point for the company's production, as it aims to refocus its efforts on North America while shedding other international assets.

But the company reported that in the Eagle Ford, Bakken and Permian basins, unconventional U.S. reservoirs that ConocoPhillips expects to be drivers of its future growth, combined production climbed 42%.

Simmons and Co. analysts said the ConocoPhillips exceeded expectations with low corporate charges and "well-behaved" productions.

"Overall, results were better than we had expected, and in-line to better than the street had expected as well," they wrote.

Chairman and Chief Executive Ryan Lance said the company is on track to grow production and improve margins this year, pointing to discoveries in the Gulf of Mexico last quarter.

"Our base business is operating to plan, our development programs and major projects are performing as expected and we are on track to deliver production and margin improvements this year," he said.

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Hess 1Q Profit Doubles on Asset-Sales Gains

Hess Corp.'s first-quarter earnings more than doubled on gains from asset sales, while the oil and gas producer's revenue improved despite lower production.

Hess has been shedding assets to fund drilling and exploration efforts as it struggles with lackluster profits and a shareholder revolt. So far this year, the company has completed or agreed to sales that will bring in $3.4 billion. Earlier this month, Hess agreed to sell its stake in a Russian subsidiary to OAO Lukoil (LKOH.RS) for $1.8 billion.

Proceeds from the sales helped boosts Hess's first-quarter profits to $1.28 billion, or $3.72 per share, from $545 million, or $1.60 a share, a year earlier. Excluding those sales, the company's adjusted earnings were $1.95 a share, up 30% from a year ago and well ahead the $1.59 a share analysts had predicted. Revenue jumped 39% to $4.12 billion.

Shares rose 2.8% Wednesday morning to $70.11.

Hess has been battling criticism from dissident investor Elliott Management Corp., which has aimed to elect five board members and directly pay them bonuses based on how Hess shares perform. The hedge fund, which controls 4.4% of Hess's shares, also wants to split Hess into two companies in a bid to boost the stock's performance.

Both Hess and Elliott have put forward slates of board nominees. Shareholders will vote at the company's annual meeting next month.

In the Bakken, which Hess has said will drive growth as it transforms itself into a pure exploration and production company, the company reported production grew by 55% from a year ago to 65,000 barrels of oil equivalent per day, even as costs per well fell 36%. Elliott Management has criticized Hess for cost overruns in the Bakken.

Hess said during a conference call following its earnings report that it expects Bakken production to average between 64,000 and 70,000 barrels of oil equivalent a day through the rest of the year.

Hess announced earlier this year that it planned to focus exclusively on upstream work, divesting its terminal, retail energy marketing and trading operations as well as closing its last remaining refinery in Port Reading, N.J.

During a conference call, Hess Chief Executive John Hess said the company now has a "focused, liquids-rich portfolio that is lower risk," and does not plan to sell more assets.

Elliott has called for Hess to separate its high growth Bakken assets from costly international assets, but Hess has said that idea won't be good for shareholders.

Mr. Hess said during the call that the asset portfolio as is will generate returns for investors.

Earnings at Hess's exploration and production business doubled to $1.29 billion, due primarily to gains on asset sales. Average daily production decreased 2% to 389,000 barrels of oil equivalent as asset sales and lower production from the Valhall Field in Norway partially offset increased production from the Bakken oil-shale play.

The marketing and refining segment's results are now booked as discontinued operations. Marketing and refining earnings--which comprise retail, energy-marketing, refining, and energy-trading results--rose to $100 million from $12 million a year ago.

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CNOOC 2012 Net Profit Falls 9.3%; Slightly Below Analysts' View

HONG KONG - CNOOC Ltd., which completed its acquisition of Canada's Nexen Inc. last month, Friday posted a 9.3% fall in 2012 net profit, a decline that was largely anticipated because of rising operating costs and higher resources tax expenses.

CNOOC, China's largest publicly traded offshore oil-and-gas producer by capacity, posted a net profit of 63.69 billion yuan (US $10.3 billion) in 2012, down from CNY70.26 billion the previous year. The figure was slightly below the average CNY64.86 billion net profit forecast of 32 analysts polled earlier by Thomson Reuters.

Revenue rose 2.8% to CNY247.63 billion from CNY240.94 billion on higher oil and gas sales.

China's state-run CNOOC and its parent China National Offshore Oil Corp. have been the most aggressive among Chinese oil giants in terms of acquiring overseas shale gas and oil assets. Since 2011, the two have spent over US $24.8 billion on overseas upstream assets, mostly in Africa, Australia and Canada.

The Nexen acquisition, China's largest single overseas investment, is vital for CNOOC's long-term growth and energy security, as its oil-and-gas output growth has been slowing since 2011 due to maturing fields.

"We strongly believe that the acquisition of Nexen conforms to our development strategy and will bring long-term benefits to our shareholders," CNOOC Chairman Wang Yilin said Friday.

The company proposed a final dividend of HK$0.32, up from HK$0.28 a year earlier.

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Lukoil 4Q 2012 Profit Almost Doubles

MOSCOW - OAO Lukoil Holdings, Russia's No. 2 crude oil producer, said Thursday its net profit for the final three months of 2012 nearly doubled compared with the same period the previous year, when it was hit by a nearly $1 billion write-off.

Lukoil said net profit for the period totaled $2.69 billion, compared with $1.35 billion in 2011. That was slightly below a forecast of $2.72 billion from a Dow Jones Newswires survey of five analysts.

The company didn't provide a breakdown of fourth-quarter results, but said revenue for the full year increased 4.1% to $139.2 billion from $133.7 billion, on the back of higher oil prices. Earnings before interest, taxation, depreciation and amortization, or Ebitda, rose 1.7% to $18.9 billion from $18.6 billion. Net profit for the year was up 6.2% on 2011 at $11.0 billion.

Lukoil will host a presentation later Thursday, where analysts say they are looking for information on the company's progress on stabilizing production and plans for international projects, such as West Qurna-2 in Iraq.

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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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Sembcorp Marine Sees Profit Dip, Admits 2012 Challenging Year

Sembcorp Marine posted late Thursday a net profit for the final quarter of 2012 at $135 million (SGD167 million), down 27 percent from the same period last year. In 4Q 2011, Sembcorp Marine booked a net profit of $185 million (SGD229 million).

Operating profit for the quarter was $120 million (SGD 148 million), down 26 percent from one year ago.

Sembcorp Marine also saw its net and operating profits slide on a full year basis. For the year ended Dec. 31, 2012, the company posted a net profit of $435 million (SGD 538 million) and an operating profit of $448 million (SGD 554 million), down 28 percent and 25 percent respectively.

Sembcorp Marine noted in its earnings release that it was operating in a challenging environment last year. The company ended last year having to grapple with the aftermath of an offshore accident; the Noble Regina Allen (400' ILC jackup) tilted during a jacking system test Dec. 3, 2012. The incident led to some 89 workers being injured.

Sembcorp Marine revealed in its earnings report that the company has a net order book of $11 billion (SGD 13.6 billion) with completion and deliveries stretching into 2019.

"Amid the fragile global environment, the long-term industry fundamentals for the Offshore Oil and Gas sector remain sound underpinned by high oil prices and projected increases in offshore exploration and production spending," Sembcorp Marine said in a statement.

"Yard activity level will remain high over the next two years, supported by Sembcorp Marine's $11 billion net order book. However, margins may continue to normalize. In this rig order cycle, price increase is slower and we believe this is attributed to rising competition for offshore orders," OSK Research's analyst Jason Saw said in an opinion statement.

"The jackup rig replacement theme is still intact but this market segment will see competition from Chinese and Middle East yards," Saw noted.

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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Sembcorp Marine Sees Profit Dip, Admits 2012 Challenging Year

Sembcorp Marine posted late Thursday a net profit for the final quarter of 2012 at $135 million (SGD167 million), down 27 percent from the same period last year. In 4Q 2011, Sembcorp Marine booked a net profit of $185 million (SGD229 million).

Operating profit for the quarter was $120 million (SGD 148 million), down 26 percent from one year ago.

Sembcorp Marine also saw its net and operating profits slide on a full year basis. For the year ended Dec. 31, 2012, the company posted a net profit of $435 million (SGD 538 million) and an operating profit of $448 million (SGD 554 million), down 28 percent and 25 percent respectively.

Sembcorp Marine noted in its earnings release that it was operating in a challenging environment last year. The company ended last year having to grapple with the aftermath of an offshore accident; the Noble Regina Allen (400' ILC jackup) tilted during a jacking system test Dec. 3, 2012. The incident led to some 89 workers being injured.

Sembcorp Marine revealed in its earnings report that the company has a net order book of $11 billion (SGD 13.6 billion) with completion and deliveries stretching into 2019.

"Amid the fragile global environment, the long-term industry fundamentals for the Offshore Oil and Gas sector remain sound underpinned by high oil prices and projected increases in offshore exploration and production spending," Sembcorp Marine said in a statement.

"Yard activity level will remain high over the next two years, supported by Sembcorp Marine's $11 billion net order book. However, margins may continue to normalize. In this rig order cycle, price increase is slower and we believe this is attributed to rising competition for offshore orders," OSK Research's analyst Jason Saw said in an opinion statement.

"The jackup rig replacement theme is still intact but this market segment will see competition from Chinese and Middle East yards," Saw noted.

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.

Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.

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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.

Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.

View the original article here

Sembcorp Marine Sees Profit Dip, Admits 2012 Challenging Year

Sembcorp Marine posted late Thursday a net profit for the final quarter of 2012 at $135 million (SGD167 million), down 27 percent from the same period last year. In 4Q 2011, Sembcorp Marine booked a net profit of $185 million (SGD229 million).

Operating profit for the quarter was $120 million (SGD 148 million), down 26 percent from one year ago.

Sembcorp Marine also saw its net and operating profits slide on a full year basis. For the year ended Dec. 31, 2012, the company posted a net profit of $435 million (SGD 538 million) and an operating profit of $448 million (SGD 554 million), down 28 percent and 25 percent respectively.

Sembcorp Marine noted in its earnings release that it was operating in a challenging environment last year. The company ended last year having to grapple with the aftermath of an offshore accident; the Noble Regina Allen (400' ILC jackup) tilted during a jacking system test Dec. 3, 2012. The incident led to some 89 workers being injured.

Sembcorp Marine revealed in its earnings report that the company has a net order book of $11 billion (SGD 13.6 billion) with completion and deliveries stretching into 2019.

"Amid the fragile global environment, the long-term industry fundamentals for the Offshore Oil and Gas sector remain sound underpinned by high oil prices and projected increases in offshore exploration and production spending," Sembcorp Marine said in a statement.

"Yard activity level will remain high over the next two years, supported by Sembcorp Marine's $11 billion net order book. However, margins may continue to normalize. In this rig order cycle, price increase is slower and we believe this is attributed to rising competition for offshore orders," OSK Research's analyst Jason Saw said in an opinion statement.

"The jackup rig replacement theme is still intact but this market segment will see competition from Chinese and Middle East yards," Saw noted.

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

Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.

View the original article here

Sembcorp Marine Sees Profit Dip, Admits 2012 is a Challenging Year

Sembcorp Marine posted late Thursday a net profit for the final quarter of 2012 at $135 million (SGD167 million), down 27 percent from the same period last year. In 4Q 2011, Sembcorp Marine booked a net profit of $185 million (SGD229 million).

Operating profit for the quarter was $120 million (SGD148 million), down 26 percent from one year ago.

Sembcorp Marine also saw its net and operating profits slide on a full year basis. For the year ended Dec. 31, 2012, the company posted a net profit of $435 million (SGD538 million) and an operating profit of $448 million (SGD554 million), down 28 percent and 25 percent respectively.

Sembcorp Marine noted in its earnings release that it was operating in a challenging environment last year. The company ended last year having to grapple with the aftermath of an offshore accident; the Noble Regina Allen (400’ILC jackup) tilted during a jacking system test on Dec. 3, 2012. The incident led to some 89 workers being injured.

Sembcorp Marine revealed in its earnings report that the company has a net order book of $11 billion (SGD13.6 billion) with completion and deliveries stretching into 2019.

"Amid the fragile global environment, the long-term industry fundamentals for the Offshore Oil and Gas sector remain sound underpinned by high oil prices and projected increases in offshore exploration and production spending," Sembcorp Marine said in a statement.

"Yard activity level will remain high over the next two years, supported by Sembcorp Marine’s $11 billion net order book. However, margins may continue to normalize. In this rig order cycle, price increase is slower and we believe this is attributed to rising competition for offshore orders," OSK Research's analyst, Jason Saw, said in an opinion statement.

"The jackup rig replacement theme is still intact but this market segment will see competition from Chinese and Middle East yards," Saw noted.

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

Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.

View the original article here

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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Sembcorp Marine Sees Profit Dip, Admits 2012 is a Challenging Year

Sembcorp Marine posted late Thursday a net profit for the final quarter of 2012 at $135 million (SGD167 million), down 27 percent from the same period last year. In 4Q 2011, Sembcorp Marine booked a net profit of $185 million (SGD229 million).

Operating profit for the quarter was $120 million (SGD148 million), down 26 percent from one year ago.

Sembcorp Marine also saw its net and operating profits slide on a full year basis. For the year ended Dec. 31, 2012, the company posted a net profit of $435 million (SGD538 million) and an operating profit of $448 million (SGD554 million), down 28 percent and 25 percent respectively.

Sembcorp Marine noted in its earnings release that it was operating in a challenging environment last year. The company ended last year having to grapple with the aftermath of an offshore accident; the Noble Regina Allen (400’ILC jackup) tilted during a jacking system test on Dec. 3, 2012. The incident led to some 89 workers being injured.

Sembcorp Marine revealed in its earnings report that the company has a net order book of $11 billion (SGD13.6 billion) with completion and deliveries stretching into 2019.

"Amid the fragile global environment, the long-term industry fundamentals for the Offshore Oil and Gas sector remain sound underpinned by high oil prices and projected increases in offshore exploration and production spending," Sembcorp Marine said in a statement.

"Yard activity level will remain high over the next two years, supported by Sembcorp Marine’s $11 billion net order book. However, margins may continue to normalize. In this rig order cycle, price increase is slower and we believe this is attributed to rising competition for offshore orders," OSK Research's analyst, Jason Saw, said in an opinion statement.

"The jackup rig replacement theme is still intact but this market segment will see competition from Chinese and Middle East yards," Saw noted.

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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Santos Confident on Achieving Production Target despite Profit Drop

Santos' full year net profit dropped by nearly a third, but the oil and gas producer remains optimistic about its ability to meet its production targets this year.

The company's net profit for the full year to Dec. 31, 2012, fell to $534.8 million (AUD 519 million), from $776.5 million (AUD 753 million). Santos explained in its earnings disclosure that in 2011, it made an exceptional gain on an asset sale.

Underlying net profit rose 34 percent to $625 million (AUD 606 million), driven by higher liquid volumes and gas prices.

Meanwhile, the company's oil production volume is up ten percent to 52.1 million barrels of oil equivalent.

"Production in 2012 was driven by new assets in Western Australia and Vietnam, and strong Cooper oil production. We expect a further lift in production this year," Santos' CEO, David Knox, said in a statement.

"Our liquefied natural gas (LNG) projects are poised to deliver significant shareholder value and remain on schedule with Papua New Guinea LNG on track for first LNG in 2014 and Gladstone LNG (GLNG) in 2015. Cost estimates for both projects are unchanged," Knox noted.

The company's main LNG project is the $19 billion (AUD18.5 billion) GLNG development on Queensland, which utilizes coal seam gas to LNG technology.

Santos disclosed in January this year that the production cost associated with GLNG blew out $53 million (AUD 50 million). At that time, Santos said GLNG’s production costs for 2012 were expected to be at $694 million (AUD 660 million), much higher than its previous cost guidance – issued in October last year – of $641 million to $673 million (AUD 610 million to AUD 640 million).

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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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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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.

Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.

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