Production has increased strongly with third quarter production up by 12%, and revenue up 26% compared with the second quarter to 30 June 2004.
Revenue rose by 9% when compared with the September 2003 quarter, while production declined by 11% as forecast. Production optimization, acquisitions and new projects continued to slow the rate of decline.
Revenue for the latest quarter was Santos' highest quarterly revenue since 2001. The higher average oil price for the quarter more than offset the impact of lower sales volumes and resulted in the Company's sales revenue increasing to $420.3 million compared with $386.4 million in the September 2003 quarter.
The average oil price for the quarter increased to A$57.36 per barrel – up 34% over the third quarter of 2003.
Recent performance in quarterly production and sales is depicted in the chart at the end of this release.
"Lower third quarter production in 2004 was due mainly to reduced Cooper Basin gas and liquids production as a result of the Moomba incident and lower firm contracted demand," said Santos' Managing Director, Mr. John Ellice-Flint.
"Pleasingly, crude oil production from the Cooper increased against the second quarter and also against the third quarter last year. This is the highest quarterly production in four years," he said.
"The Moomba plant was fully recommissioned during the third quarter. Losses during the quarter will be included in the Company's insurance claim, which is currently in progress."
Mr. Ellice-Flint said Santos' production outlook for 2004 remained unchanged at 45 to 46 million barrels of oil equivalent (mmboe) despite higher production losses than first anticipated from the Moomba incident.
"The rapid development of new projects continues to be a priority and we have maintained a high level of spending with third quarter development expenditure of $158.5 million," he said.
Significant progress on key growth projects was achieved during the third quarter, including:
This quarter marked the start of an active exploration period for Santos with several potentially high impact exploration wells spudded. More are planned for the fourth quarter. Exploration results to date include the successful Torres 1A well in the United States, which was recently brought onto production. In the opening weeks of October, the Jeruk 2 well, which was drilling in the third quarter, was tested with an encouraging flow of 7,488 barrels of 33 API oil per day through a 1/2 inch choke at a flowing pressure of 2,762 psi.
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