Woodside shares up 3% on targets

Shares in Woodside Petroleum have gained almost three per cent as the energy giant says it's on track to lift oil production this year after posting a 98 per cent boost to its full year profit.

Woodside's net profit rose to $US2.98 billion ($A2.89 billion) for the 2012 calendar year, from $US1.5 billion ($A1.46 billion).

The 2011 result was dragged down by the cost of delays to its $US14.9 billion Pluto liquefied natural gas (LNG) project off the northwest coast of Western Australia.

Sales revenue in 2012 rose 29.6 per cent to $US6.2 billion ($A6.12 billion), from $US4.8 billion ($A4.66 billion).

Woodside's shares were 105 cents, or 2.8 per cent, higher at $38.96 at 1408 AEDT.

Chief executive Peter Coleman said the 2012 result was underpinned by a 31 per cent increase in production and 30 per cent lift in sales revenue.

Production in 2012 was 84.9 mmboe, up 31 per cent from 64.6 mmboe in 2011.

The Pluto LNG project and higher contributions from the Vincent and North West Shelf oil facilities also helped improve earnings.

"Woodside's production target for 2013 remains unchanged at a range of 88 to 94 MMboe (million barrels of oil equivalent), comprising 47 per cent from NWS Gas facilities, 41 per cent from Pluto LNG and 12 per cent from other assets," Woodside said.

Pluto had performed at better-than-expected rates due to high reliability in the production ramp-up phase, it said.

Between its start-up last April and the end of calendar 2012, it produced 2.7 million tonnes of LNG and 2.1 million barrels of condensate.

Woodside's investment expenditure fell 53 per cent in 2012 to $US1.8 billion ($A1.75 billion), largely driven by lower expenditure at Pluto.

The company will push ahead with a $2.6 billion expenditure program for projects in Israel and Myanmar.

Woodside increased its capital expenditure budget for 2013, with a forecast it will spend about $US1.0 billion on the Leviathan gas project in Israel.

"Investment expenditure for 2013 is expected to be $US2.6 billion ($A2.52 billion), which is higher than previous guidance due to anticipated additional expenditures associated with the Leviathan and Myanmar opportunities," Woodside said.

The expected investment expenditure comprises $US2.1 billion ($A2.04 billion) capital plus $US500 million ($A485.34 million) of exploration expenditure.

Morningstar analyst Mark Taylor said the strong profit result was within market expectations on the back of Pluto's solid contribution.

But, he said, he was disappointed the company would push ahead with the Israel project.

"It's an unnecessary diversification away from their core area of expertise and where they're located," he said.

Mr Coleman's $7.3 million 2012 pay packet was up from $3.8 million in 2011 and included $2.6 million in shares.

Woodside lifted its fully-franked final dividend by 10 US cents, to 65 US cents.

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