Origin Energy saw a lower quarterly revenue from the Australia Pacific LNG project but it managed to renegotiate a crucial supply deal with China’s Sinopec.
Origin Energy, which holds a 37.5 percent stake in the APLNG project, said Thursday the first price review under Sinopec’s long-term contract was completed with no change to the contract price.
APLNG is a joint venture between Origin, ConocoPhillips, and Sinopec.
Production at APLNG rose 6 percent year-on-year to 66.8 petajoules during January-March, but dropped slightly below the December quarter’s record level.
Origin’s revenue from APLNG came in at A$628.5 million ($411.60 million) for the January-March period, down from A$763.9 million a year earlier.
Revenue dropped due to lower contracted LNG sales.
APLNG’s effective oil price in the March quarter was $65 per barrel, down from $69/bbl in the Dec-19 quarter and $78/bbl in the Mar-19 quarter.
Both JCC and spot LNG prices softened in the March quarter as a result of demand weakness linked to the Covid-19 coronavirus pandemic.
Chief executive Frank Calabria said “in energy markets, we are already seeing an initial impact from the pandemic on electricity demand.”
This along with “milder weather and lower customer numbers and usage, contributed to lower volumes compared to this time last year,” he said.