Origin Boosts Total 2P Reserves by 13%

- Origin Boosts Total 2P Reserves by 13%

Friday, July 29, 2011
Origin Energy Ltd.

Origin announced record annual production and sales revenues for its Exploration and Production business, released in the company's Production Report for the quarter to June 30, 2011.

This follows the release yesterday of Origin's 2011 Annual Reserves Report, in which the company announced a 13 percent annual increase in total Proved plus Probable (2P) reserves.

Origin Executive Director, Finance and Strategy, Ms. Karen Moses, said, "The Exploration and Production business has delivered record annual production of 135 Petajoules equivalent (PJe), up 30 percent on the prior year. Sales revenues also increased to a record $835 million, an increase of 32 percent on the prior year.

"The strong performance was driven by a 36 percent increase in production from Australia Pacific LNG as gas was supplied into major new contracts, higher production from Origin's increased share of Otway, a full year's contribution from Kupe and higher production from BassGas after an extended shutdown in 2009/2010.

"Notably, the record increases were achieved amid a challenging operating environment with extreme weather conditions impacting a number of our assets.

"Origin also reported a 13 percent annual increase in 2P reserves to 7,041 PJe, driven by increases in our CSG reserves held through Australia Pacific LNG and in the Ironbark area," Ms. Moses said.

During the year, Australia Pacific LNG made significant progress on its CSG to LNG project, culminating with a Final Investment Decision announced on July 28, 2011. The decision initiates development of the first LNG train and infrastructure to support a second train, and is underpinned by a sale and purchase agreement with Sinopec for the supply of 4.3 million tonnes per annum of LNG. Sinopec has also subscribed for a 15% equity interest in Australia Pacific LNG1.

"The Final Investment Decision on the first phase of the Australia Pacific LNG project marks the commencement of one of Australia’s largest LNG export projects," Ms. Moses said.

"Australia Pacific LNG holds Australia's largest 2P CSG reserves, including extensive acreage within the premier production fairways providing high quality gas resources with high deliverability," Ms. Moses said.

Production for the quarter to 30 June 2011 was 37 PJe, or 23 percent, higher than the June Quarter in 2010, with all asset areas either increasing production or maintaining production at comparable levels. Most notably, Otway increased production by 49 percent. Total sales volumes and revenues increased by 8 percent and 11 percent respectively.

Compared with the March Quarter 2011, production was 28 percent higher, as Otway returned to higher production levels and CSG and Cooper Basin production increased after the floods experienced earlier in the year. Sales volumes and revenues were 19 percent and 14 percent higher respectively, reflecting the increased production.

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