Woodside wobbles

The oil and gas producer’s shares have taken a tumble after its oil production slipped and impairments struck its Pluto plant.

Woodside Petroleum shares fell after the oil and gas explorer and producer said its production and sales fell in the second quarter while costs rose amid lower global oil prices.

At 1013 AEST Perth-based Woodside shares dropped 13 cents, or 0.4%, to $37.32, after earlier falling as low as $37.24 after the company said in an ASX statement its sales in the three months to June 30 were $US1.34 billion, down 6% from the three months to March 31.

Woodside said second quarter production dropped 8.6% to 20 million barrels of oil equivalent (MMboe) from 21.9 (MMboE) in the first quarter. Maintenance and an unplanned gas outage at its Western Australian liquid natural gas project called Pluto was blamed for the drop in production by the company.

The average price of Brent crude oil in the second quarter was $US103.35 a barrel compared with $US108.76 a barrel in the first quarter, Woodside said.

Depreciation, depletion and amortisation costs for the company in the six months to June 30 will be between $590 million and $620 million, up from the corresponding period a year ago due to a fall in production from its Pluto gas plant. The company said impairment costs are likely to be between $120 million and $140 million for the first half of this year (see Woodside's yield-growth challenge by Tim Treadgold).

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