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Woodside first-half profit rises 49% on higher crude prices

[SYDNEY] Woodside Petroleum Ltd, the largest oil and gas producer in Australia, posted a 49 per cent increase in first-half profit amid higher energy prices and lower production costs.

Net income rose to US$507 million from US$340 million a year ago, the Perth-based company said Wednesday in a statement. That beat an estimate of US$452 million from UBS Group AG analyst Nik Burns. The result was buoyed by a 6 per cent fall in production costs to US$4.90 per barrel of oil equivalent.

Woodside, which operates the Pluto and North West Shelf liquefied natural gas projects in Western Australia, reported last month its first-half output had declined to 42.2 million barrel of oil equivalent or boe on revenue of US$1.76 billion.

The Perth-based company is on the verge of seeing first production from the Chevron Corp.-operated Wheatstone LNG plant where it owns a 13 per cent stake. The two companies may also team up on the Woodside-operated North West Shelf plant where Chevron could be offered a tolling opportunity for its equity gas, Macquarie Group Ltd said on June 30. It also hopes to accelerate its long-stalled gas resource Browse in 2018, potentially piping the gas back through either the North West Shelf or Pluto plants.

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Woodside expects Brent oil to average US$55 a barrel in 2017, ticking up to US$65 a barrel next year as the market begins to rebalance. Crude has averaged about US$52 a barrel this year compared with about US$45 in 2016.