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APLNG reaps benefits for Origin results

Origin Energy APLNG

Origin Energy chief executive officer Frank Calabria has described operating conditions as challenging this year due to low prices and the impacts of COVID-19 across its key commodities of electricity, natural gas and oil.

Outlined in the company’s full year results, Australia Pacific LNG (APLNG) highlights included stable production of 263 petajoules on record low development activity and operation expenditure and strong field performance.

Origin’s share of APLNG 2P reserves increased by 6 per cent before production translating to a 94 per cent reserves replacement ration, due to higher estimated recoveries from producing fields and maturation of the Ramyard South and Spring Gully East Flank fields to reserves.

In the growth assets and future fuels portfolios, initial flowback and production testing on the Kyalla well in the Beetaloo Basin was completed, with preparations for an extended production test continuing.

The first well in the Canning Basin farm-in was spudded in July. Work on a number of hydrogen renewable fuels projects continues, with a feasibility study on a green ammonia export project in Tasmania’s Bell Bay expected to be completed by the end of 2021. 

“Our immediate focus is on capital discipline and cost management to continue to build balance sheet resilience, with a rebound in the energy markets earnings expected in the 2023 financial year assuming current forward commodity prices continue and flow through to tariffs,” Calabria said.

“APLNG was outstanding, safely curtailing output when the market was subdued, and rapidly ramping up production when demand recovered, matching previous daily production records and shipping a record 130 cargoes for the year.”

Calabria also added that strong field capability and improved productivity helped deliver record low costs, with a distraction breakeven almost half what it was three years ago.

In addition, cash flow from APLNG are estimated to be greater than $1 billion in the 2022 financial year net of oil heading based on an assumption of a realised $US68/bbl oil price.

APLNG is expected to have stable production of between 685-710 PJ, reflecting strong field performance and a distribution breakeven of between $US20-25/bbl.

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