Origin To Take A$1.9B Charge On LNG, Exploration Assets
MELBOURNE, Feb 15 (Reuters) - Origin Energy tweaked up its earnings forecast but warned on Wednesday it will book a A$1.89 billion ($1.45 billion) charge in its half-year results, mainly on its stake in the Australia Pacific liquefied natural gas (APLNG) project.
Origin raised the bottom end of its forecast range for annual underlying earnings before interest, tax, depreciation and amortisation (EBITDA) by 3 percent to A$2.45 billion, but kept the top end of the forecast at A$2.62 billion.
It is due to report half-year results on Thursday, the first results under its new chief executive, Frank Calabria, who took the helm in October.
Origin's shares jumped as much as 2.3 percent to a 17-month high following the announcement, but shed those gains to trade flat by midday.
Analysts said the A$1.03 billion impairment charge on its 37.5 percent stake in the APLNG project was not a big surprise in the wake of writedowns taken by rivals, like Santos Ltd , on their LNG projects last year.
"The market is probably just seeing it as clearing the decks for the new CEO," said a Sydney-based analyst who declined to be named as he was not authorised to speak to the media.
APLNG, operated by ConocoPhillips, is one of three coal seam gas-to-LNG plants which opened over the past two years in the northeastern state of Queensland amid a sharp slump in global oil and gas prices.
APLNG had no immediate comment on the impairment. Origin said it was mostly due to a change in assumptions on U.S. dollar interest rates.
Origin also flagged it would book a A$578 million charge against its Browse Basin assets, which it bought for US$600 million in 2014, as it does not see them being developed anytime soon to supply ConocoPhillips' Darwin LNG plant.
It said it believed another asset in the area, the Caldita-Barossa fields owned by ConocoPhillips, Santos and PetroChina, was likely to be chosen to supply Darwin LNG when its existing gas source, Bayu-Undan, runs out early in the next decade.
Origin also flagged a A$170 million charge against the exploration assets which it plans to spin off in an initial public offering this year, which had been expected to fetch around A$1 billion.
(Reporting by Sonali Paul; Editing by Richard Pullin)
WHAT DO YOU THINK?
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.
- Weatherford CEO's Rebound Plan Relies On Getting Smaller
- Iran Says Oil Market Is Too Tight For US Zero Exports Target
- China's Squeezed 'Teapots' Eye Petchem Path To Riches
- Baker Hughes: US Drillers Add Oil Rigs For Second Week In Three
- Venezuela Hands China More Oil Presence, But No Mention Of New Funds
- ExxonMobil Racks Up Discoveries in Guyana Block Eyed by Chevron
- Oil Market Sentiment Has Improved Significantly
- EU, US Eye Collaboration on Nuclear Materials
- USA Driving Activity to Increase to All-Time Highs
- EU Electricity Export to Ukraine Up 94 Percent in Two Years
- China Coal Output Falls for First Time since Government Ordered More
- TC Energy to Sell Prince Rupert Gas Pipeline Project to First Nation
- BP Pulse Buys One of Europe's Largest Truck Stops
- UK CCUS Plans Outdated: Think Tank
- I Squared Eyes Full Ownership of Europe Gas Storage Firm
- Norway Regulator Blasts Proposal to Halt New Oil and Gas Permits
- Chinese Mega Company Makes Major Oilfield Discovery
- EIA Drops 2024 Henry Hub Gas Price Forecast
- EIA and Standard Chartered Offer Up Latest Oil Price Predictions
- Red Sea Region Sees Another Watershed Incident
- Chevron Oil Project in Kazakhstan to Cost $48.5B
- OPEC Voices Encouragement after IEA Affirms Support for Oil Security
- Biden Govt Bares Strategy for Freight Charging, Hydrogen Fueling Infra
- Ukraine Hits Third Russian Refinery In Escalating Drone Strikes
- Rystad Looks at the Buzz Around White Hydrogen
- VIDEO: Missile Attack Kills Crew Transiting Gulf of Aden
- Norway Regulator Blasts Proposal to Halt New Oil and Gas Permits
- Chinese Mega Company Makes Major Oilfield Discovery
- What Is the Biggest Risk to Offshore Oil and Gas Personnel in 2024?
- Is Peak Oil Demand Close?
- Vessel Sinks in Red Sea After Missile Strike
- JP Morgan, Standard Chartered Reveal Latest Oil Price Forecasts
- Exxon Rights in Stabroek Do Not Apply to Hess Merger with Chevron: Hess
- Rystad Forecasts Net Production of Top Permian Producers in 2024
- Analysts Reveal Latest Oil Price Outlook Following OPEC+ Cut Extension