Oil Search has recorded a core profit $ US 359.9 million (K1,032.12m) in 2015, compared to $US 482.8 million (K1,384.57m) in 2014.
This result was achieved despite 2015 being one of the most challenging years in recent history for the oil and gas industry.
Managing Director Peter Botten said despite strong operating results from their key assets, Oil Search is clearly not immune to low oil and gas prices.
“Fortunately, our producing assets are in the lowest quartile of operating costs in the region and we have a strong balance sheet, which allows us to continue to judiciously invest in what we believe are very competitive, potentially high returning growth projects.
“We will continue to drive further efficiencies and reduce costs in 2016, in line with what is likely to be a sustained period of low prices. We do, however, believe that there will be a progressive rebalancing of supply and demand that will see a lift in oil prices in 2017 and 2018.”
At the end of 2015, Oil Search had total liquidity of $ US 1.66 billion.
He said together with cash flow from their operations, this is sufficient to fund all current committed activities, including continued investment in their highly competitive potential LNG growth projects, which they believe can deliver strong returns even in a sustained low oil price environment.
Botten added that Oil Search enters 2016 in a strong position with PNG LNG Project and the PNG oil fields generating positive free cash flow and the company continues to invest in value-adding growth.
“Oil Search believes that there is a high probability that the low-cost, globally competitive PNG LNG expansion and Papua LNG development will proceed while many other proposed LNG developments are delayed or deferred, enabling the company to continue generating strong long-term returns for shareholders.”