Woodside Petroleum Ltd., Australia’s second-largest oil producer, ended talks with companies to obtain natural gas supplies needed to enable an expansion of its A$15 billion ($15.4 billion) Pluto project.
“There are no active discussions with other resource owners with regard to Pluto expansion,” the Perth-based company said today in a statement while reporting a 21 percent increase in first-quarter sales. “Woodside is continuing its efforts in the pursuit of expansion gas and has exploration activities scheduled in the region over the coming years.”
The company last year put a planned second stage at Pluto on hold after its drilling campaign failed to find enough gas, though said it was talking with other owners of gas resources in a bid to expand the development. Woodside’s decision comes after it last week scrapped plans to develop the Browse liquefied natural gas project at an onshore site in Western Australia, estimated to cost $46 billion.
Shares of Woodside fell 3.5 percent, the most in almost a year, to A$33.86 at the close in Sydney. Australia’s benchmark S&P/ASX 200 Index declined 1.6 percent.
Exxon Mobil Corp.’s Scarborough field with BHP Billiton Ltd. off Western Australia was seen as a potential source of supply to expand Pluto, Citigroup Inc. said in an April 4 report. Exxon now plans to develop a floating LNG project for Scarborough, according to documents the company filed earlier this month with the Australian government.
“Pluto expansion has no other options without further exploration success,” Mark Greenwood, Citigroup’s Sydney-based energy analyst, said in the report.
Boosted by Pluto, Woodside’s sales climbed to $1.45 billion in the three months ended March 31, from $1.2 billion a year earlier, the company said today in a production report. That compared with UBS AG’s estimate of $1.43 billion.
Production rose 55 percent to 21.9 million barrels of oil equivalent from 14.1 million barrels a year earlier, the company said. UBS forecast 21 million barrels.