Business Description:
Oil Search Limited (OSH) is engaged in the exploration, development and production of oil and gas in Papua New Guinea (PNG). OSH's main producing operations are Kutubu, Moran, SE Mananda, Gobe and Hides, which provided total oil and gas production of 7.657 MMboe (net) for FY10.

Strategy Analysis:
The principal activities of OSH are exploration, development and production of oil and gas in PNG. LNG and other in-country developments including plans for a petrochemical plant, compressed natural gas project and other are vital to the strategy of unlocking value from stranded gas resources. Gas increasingly takes precedence over the oil business with the latter being run to fund gas expansion. Oil Search reported NPAT up 116.6% to US$114.5m for the half-year ended 30 June 2011. This increase was primarily driven by a 53% increase in realised oil prices. Revenues from ordinary activities were US$371.13m, up 34.2% from the same period last year. Diluted EPS was 8.67 US cents compared to 4.04 US cents last year. Net operating cash flow was US$259.81m compared to US$202.41m last year. The interim dividend declared was 2 US cents compared with 2 US cents last year. During the second half of 2011, activity will continue on all of the PNG LNG work fronts including: continued construction of Train 1, the marine jetty and associated facilities at the LNG plant site near Port Moresby; and mobilisation of the offshore contractor to PNG and the commencement of offshore pipe laying.