Origin Energy Limited

Origin reported FY11 underlying profit of $673m (+15%, matching the earlier guidance) and statutory profit of $186m (down 70%), the gap due to transaction costs, impairments and financial instrument fair value falls. Full-year dividend stays at 50 cents. Its 42.5% share of APLNG's first phase needs around US$6bn over four years.

annual report

Origin agreed conditional farm-in terms to earn 40% of Perth Basin permits EP 368 and EP 426 by operating and paying 80% of a 100 sq km 3D seismic survey, targeting the North Erregulla prospect. Formal agreement still needs board approvals; announced by Empire, not Origin.

farm in farm out agreement

Sinopec's purchase of 15% of APLNG completed, bringing in US$1.765bn and diluting Origin and ConocoPhillips to 42.5% each. Each partner's funding need falls by US$750m, and Sinopec's LNG supply deal (4.31 mtpa from 2015) is now unconditional. This closes the open Sinopec thread.

material agreement

APLNG's board approved FID on the first phase of a two-train CSG-to-LNG project: US$14bn for train one (US$20bn for both), first gas mid-2015. Sinopec's 15% subscription is now unconditional, cutting Origin to 42.5%, and the contingent FID payment is deferred. This resolves the long-open FID thread.

material agreement

Origin's 2P reserves at 30 June 2011 were 7,041 PJe, up 834 PJe (13%) from 6,207 PJe, after 135 PJe of production. Ironbark gets its first 2P booking of 118 PJe. Sinopec's completion would cut Origin's APLNG share by 883 PJe.

resource reserve update

Dao Ruang-3, the appraisal well in Thailand's L15/50 where Origin holds 40%, reached 1,800m and will be plugged and abandoned without a flow test. It found gas shows but limited producer potential, resolving the open result and adding to the Salamander farm-in's dry wells.

drilling result

Origin completed the sale of 50% of Kenya Block L8 to Apache, which becomes operator. Origin was reimbursed US$13.2m, and Apache will meet part of Origin's cost of the first Mbawa well. Origin now holds 25%; timing of drilling is not set.

farm in farm out completion

Origin priced a €500m (about A$680m) hybrid capital security maturing in 60 years, with a 7.875% fixed distribution for 7 years (7.48% after hedging into US dollars). S&P gives 100% equity credit, Moody's 50%. It supports the BBB+/Baa1 ratings ahead of Origin's APLNG contribution. It is treated as debt and carries no conversion rights.

debt financing

Celsius 1 geothermal well was cased and suspended: temperatures above 145°C were found, but permeability is below target, a setback for the Innamincka Shallows. Next candidates are Boyle 1 (Origin 100%, GEL 185) and Fahrenheit 1 (50:50 with Geodynamics).

drilling result

Origin bought a 40% stake in Chilean geothermal explorer Energía Andina from ENAP after a competitive process; Antofagasta Minerals keeps 60%. The company holds eight exploration projects covering 553,400 ha. Price not stated. Extends Origin's geothermal push after Sorik Marapi.

asset acquisition disposition

Australia Pacific LNG signed binding agreements with Sinopec: 4.3 Mtpa of LNG for 20 years and a 15% equity stake for US$1.5bn, cutting Origin and ConocoPhillips to 42.5% each. Converts the February heads of agreement; still needs Chinese and FIRB approvals and an FID.

material agreement

The retail shortfall bookbuild cleared at $15.80 a share, $2.80 above the $13.00 offer price, completing the roughly $2.3bn raising (retail $1.17bn). Non-participating holders receive $2.80 per share not taken up; new shares trade 29 April.

capital raising announcement

Dao Ruang-2 in Thailand (Origin 40%) failed to flow at a sustained commercial rate in an open-hole test, despite gas shows to total depth. The well is being suspended; Dao Ruang-3 is to spud within about 8 days.

well test result

Origin completed syndication of a $2.15bn and US$350m bank facility, with $500m of oversubscriptions accepted, maturing in three to five years. It refinances the December 2010 $2.0bn underwritten facility used for the NSW deal; average debt maturity is 3.9 years.

debt financing

The institutional part of the entitlement offer raised about $1.13bn, with 95% take-up at $13.00. The leftover shares cleared in a bookbuild at $15.00. The retail offer, for the remaining $1.17bn at $13.00, opens 21 March and closes 13 April.

capital raising announcement

Origin launched a fully underwritten 1-for-5 renounceable entitlement offer at $13.00 a share to raise about $2.3bn. It partly refinances debt from the $3.26bn NSW acquisition completed 1 March; the offer price is a 17.0% discount to the 14 March close. This is the equity raising previously signalled.

capital raising announcement

Origin completed the $3.25bn purchase of the Integral Energy and Country Energy retail businesses and entered binding Eraring GenTrader arrangements, as scheduled for 1 March. It now has 4.6 million customer accounts. The pro-rata equity offering to partly refinance the debt is reconfirmed.

asset acquisition disposition

Australia Pacific LNG signed a non-binding Heads of Agreement for Sinopec to buy up to 4.3 million tonnes a year of LNG for 20 years and take 15% of the project. Origin's stake would fall from 50% to 42.5%; binding agreements are still to come.

material agreement

Origin's half-year underlying profit fell 14% to $304m, with a statutory loss of $136m after $440m of non-underlying expenses including Geodynamics/Innamincka Deeps impairments. Interim dividend held at 25c; FY11 underlying EBITDA guided up ~35%, and the equity offering is reconfirmed.

half year report

Australia Pacific LNG, Origin's 50:50 joint venture with ConocoPhillips, received Federal environmental approval for its CSG-to-LNG project, subject to many conditions. This follows the Queensland approval of November 2010 and clears a key approval ahead of a final investment decision.

regulatory community update

Origin agreed to sell 50% of Kenya Block L8 to Apache, which becomes operator. Origin will be reimbursed US$13.2m of past costs and Apache will meet part of the Mbawa well cost. Origin falls from 75% to 25%; completion expected by end June. This resolves the farm-in search.

farm in farm out agreement

Contact Energy (Origin holds 51.92% of quoted shares) said MD David Baldwin will move over three months to become Origin's Chief Development Officer. Origin's Dennis Barnes, general manager of energy risk management, becomes Contact's CEO. Baldwin stays a Contact director.

director officer appointment

Silvereye 1 in T/44P (Origin 60% operator, AWE 40%) reached 2,318.2m with no significant hydrocarbon indications and will be plugged and abandoned. This is a dry hole, resolving the well awaited since its 3 December spud.

drilling result

Origin signed agreements with the NSW Government to buy the Integral Energy and Country Energy retail businesses and Eraring GenTrader rights for $3,250m, completing around 1 March 2011. Funded by new debt, partly refinanced by a pro-rata equity offering within 12 months. Customers rise from 3m to 4.6m.

asset acquisition disposition

The ACCC said it will not oppose Origin acquiring EnergyAustralia, Country Energy, Integral Energy, or Country Energy plus Integral Energy, with one gentrader bundle and one generator development site. This is competition clearance only, not a bid or purchase. It signals Origin's interest in the NSW privatisation (inference).

regulatory community update

Origin, operator of T/44P (Origin 60%, AWE 40%), began drilling the Silvereye 1 exploration well on 3 December using the Kan Tan IV rig. Planned depth is 2,400m, targeting Paleocene and Cretaceous sandstones, about 65km from Yolla. Origin's interest is stated as 60%, not the 100% in earlier records.

drilling spud

Tarapunga-1 (Origin 100%) reached 1,000m. Gas shows were seen in the target interval but nothing economically significant, and abandonment has begun. Both wells of the New Zealand programme have now been dry.

drilling result

The Queensland Coordinator-General approved the Australia Pacific LNG (Origin 50%) environmental impact statement, subject to strict conditions: gas field, 450km pipeline and Curtis Island LNG plant. Commonwealth approval is still required. This resolves the pending state EIS report ahead of the expected December FID.

regulatory community update

Korimako-1 (Origin 100%) reached 1,946m and is being plugged and abandoned. The primary target was intersected near prediction, but minor shows only, nothing economically significant. A disappointing exploration result; the rig moves to Tarapunga-1.

drilling result

September quarter production hit a record 37.1 PJe (+45% on a year earlier, +22% on June) and revenue $230m. Redback 2 flowed about 5 mmscfd and Tom Hum Xanh 1X in Vietnam was dry. Origin also reports the BTEX finding and the Korimako-1 spud.

quarterly activities report

Origin (100% operator) began drilling the Korimako-1 exploration well in the Northland Basin, NZ on 18 October, with planned depth 1,920m and about three weeks to drill. It is the first of two wells, with Kokako-1 to follow. This is the greenfield well flagged earlier.

drilling spud

Australia Pacific LNG (Origin 50%) found traces of BTEX chemicals in fluid from eight fracture-stimulated Surat Basin exploration wells. Independent confirmatory testing is under way, and further fracture stimulation of exploration wells is paused until it is resolved. It reports no evidence of impact on landholder bores.

regulatory community update

Origin and PNG EDL (50:50 JV with PNG Sustainable Development Program) are signing a cooperation memorandum with the PNG and Queensland governments to study a roughly 1,800 MW Purari hydro project. Feasibility study due 2012; early-stage, no investment decision or cost stated.

material agreement

Origin, with Tata Power and PT Supraco, won the Sorik Marapi geothermal exploration concession in Northern Sumatra, Indonesia. Origin holds 47.5% effective interest. The concession could support 200-300 MW; an 18-month exploration program follows, with construction possibly late 2012 if successful.

asset acquisition disposition

Origin's FY2010 revenue rose 6% to $8,534m; statutory profit fell 91% to $612m, against $6,941m a year earlier. Final dividend is 25c fully franked, paid 28 September. (Inference: the prior-year figure appears to include a large one-off gain, not stated here.)

annual report

Origin signed a contract to sell up to 25 PJ of Perth Basin gas to an AWE subsidiary, onsold to Synergy, for over five years, starting in August. It commercialises the Redback discoveries via spare Beharra Springs plant capacity. Subject to reserves confirmation by November 2010.

material agreement

Bang Nouan-1 in Laos (Origin 30%) was plugged and abandoned as a dry hole after the drill stem test found no significant hydrocarbon flow. This is the third dry well in the Salamander farm-in, after the two Vietnam wells, and resolves the earlier gas-show hope.

drilling result

Origin's net 2P reserves rose 38% to 6,207 PJe, driven by APLNG's 2P reserves rising 40% to 10,143 PJ (Origin share 5,071 PJe), plus gains at Kupe and Otway. This lifts the earlier 4,484 PJe figure from 30 June 2009. Annual production was 104 PJe.

resource reserve update

Tom Hum Xanh-1X in Vietnam's Block 31 (Origin earning 25%) was plugged and abandoned as a dry hole, with no significant hydrocarbons found. This is the second dry Vietnam well in the Salamander farm-in, after Tom Su Lua-1X in June.

drilling result

Origin, as Kupe operator, confirmed the 2P reserve increase: gas up 8% to 273 PJ, LPG up 5%, light oil up 27% to 18.6 million barrels, or 74.2 million BOE total. Origin holds 50%. This revises the earlier life-of-project estimate of 254 PJ gas and 14.7 million barrels.

resource reserve update

Origin welcomed the Federal Government's decision to apply the existing Petroleum Resource Rent Tax to onshore oil and gas instead of the proposed RSPT, saying it gives more certainty. Starting asset value would use market value. Details still to be finalised.

regulatory community update

Origin completed final commissioning of the 630MW Darling Downs gas power station in Queensland, an investment of over $1 billion. Origin starts booking revenue and earnings from 1 July 2010. It also bought an adjacent 77-hectare block for possible expansion.

production update

Tom Su Lua-1X in Vietnam's Block DBSCL-01 (Origin earning 25%) was plugged and abandoned as a dry hole. It found good reservoir sandstones and seals, but they were water-bearing. Rig moves to Block 31 for the Tom Hum Xanh-1X well (Origin 25%).

drilling result

Redback 2 (Origin 67%) reached 3,966m, but pressure data could not be acquired from the Wagina reservoir because of hole conditions. The well is being cased and suspended for later completion and tie-in to Beharra Springs, allowing further assessment of the accumulation's size.

drilling result

AWE reports Redback-2 intersected the Wagina reservoir at 3,861m: about 14m thick and gas charged on initial log analysis. AWE calls it encouraging but says it is too early to comment on size or commercial significance. Origin holds 67%.

drilling result

Origin signed $2.6bn of new bank facilities (A$2.3bn and US$200m syndicated loan, plus a A$100m guarantee facility), three to five years. They refinance A$1.8bn and US$200m of debt maturing in FY2010-11. The syndication was oversubscribed, with A$500m of the oversubscriptions accepted; average debt maturity rises to 4.4 years.

debt financing

Kupe Gas Project, where commissioning began in December 2009, was officially opened by NZ's Prime Minister and is now described as fully operational. Origin (50%, operator) says it will supply 10-15% of NZ gas demand and 50% of LPG demand at peak; the JV invested over NZ$1.3bn.

production update

Origin completed the Otway Gas Project purchase from Woodside, lifting its interest to 67.23% (Thylacine and Geographe fields). Adjusted price is $520m, up from the $507.2m announced in November, funded from the balance sheet. Operatorship handover expected June quarter; earnings accretive from 2010/11.

asset acquisition disposition

Australia Pacific LNG and QGC agreed a joint development framework and conditional gas sales for ATP 648P and ATP 620P. APLNG expects to sell about 190 PJ over the first two years, then an average of 25 PJ a year over 20 years. This depends on QGC's final investment decision.

material agreement

Half-year to December 2009: underlying profit up 28% to $355m; statutory profit $371m versus $6,663m a year earlier, when the APLNG dilution gain was booked. Interim dividend held at 25 cents fully franked. Full-year underlying profit still expected around 15% higher.

half year report

Origin farmed out 50% of New Zealand Canterbury Basin permit PEP 38262 to Anadarko, which becomes operator and funds the first US$30m of an exploration well. The Carrack/Caravel prospect could hold over 500 million boe if hydrocarbons are found. Drilling is most likely in 2011.

farm in farm out agreement

Salamander, operator, spudded the Bang Nouan-1 gas exploration well in Laos's Savannakhet PSC, where Origin holds 30% under its December 2009 farm-in. The mean pre-drill resource estimate is about 1.1 Tcf, with a high-risk target and about 75 days to drill.

drilling spud

Australia Pacific LNG, Origin's 50:50 venture with ConocoPhillips, lodged its draft environmental impact statement with the Queensland Government. It covers the gas fields, the 450km pipeline and a four-train LNG plant on Curtis Island. Final investment decision is expected by December 2010, first export late 2014. The EIS milestone comes ahead of that decision.

regulatory community update

Australia Pacific LNG began commissioning Stage Two of the Talinga CSG plant, after Stage One in November. Capacity passes 30 TJ/d now, 90 TJ/d on completion. APLNG's CSG capacity rises to about 250 TJ/d, targeted at 350 TJ/d later in 2010.

production update

Origin and US semiconductor maker Micron formed a 50:50 joint venture to develop photovoltaic technology. The near-term aim is to combine Origin's solar work with Micron's capabilities and examine commercialisation. No funding or financial terms stated.

joint venture update

Australia Pacific LNG (50:50 Origin/ConocoPhillips) signed pipeline and upstream facilities contracts with two contractor joint ventures, following the Savanna rig deal. Both are scalable to the full 450km pipeline. Final investment decision is still expected at end-2010. No contract values stated.

contract award

Rockhopper 1 was confirmed as a new oil and gas discovery in the Bass Basin: wireline data show multiple hydrocarbon columns, with oil recovered from some sands and liquids-rich gas from others. Reservoir quality appears variable, and a downflank sidetrack is being considered. Commercial significance is not yet known.

drilling result

Rockhopper 1 reached 3,522m, drilling through its target with several sand intervals between 2,827m and 3,421m showing good gas shows and elevated resistivity, indicating hydrocarbons. Type and commercial significance await wireline logs and samples. Encouraging early sign after the Trefoil 2 appraisal.

drilling result

Australia Pacific LNG (50:50 Origin/ConocoPhillips) awarded a $220m contract to Savanna for two drilling rigs and two workover rigs, five years from September 2010. Final investment decision is still expected at end-2010, with the environmental statement due in the March quarter 2010.

contract award

Origin, as BassGas operator, approved the $345m Yolla Mid-Life Enhancement: two new wells (Yolla-5, -6), crew accommodation and compression, with Origin's share $147m. Wells and accommodation due June quarter 2011, compression mid 2012. BassGas is offline for maintenance until late February 2010.

material agreement

Origin completed its gas transport agreement with Epic: up to 1,200 PJ over 22 years from January 2012, with extension options of up to 10 more years on some capacity. Origin did not exercise its option to help fund the expansion. Follows the conditional June 2009 deal.

material agreement

Hastings (HDF) said financing for Epic Energy's South West Queensland Pipeline expansion is signed, with a total cost of $858m. Epic says Origin's gas transport contract is now firm and binding. Completion is targeted by 1 January 2012. Resolves the earlier conditional agreement.

material agreement

Benaris will exercise pre-emption on part of Woodside's Otway stake and CalEnergy will not. Origin's price falls from $712.5m to $507.2m, lifting it to 67.23% of the main joint venture and 82.30% in T/34P. Completion is still expected by end-2009.

asset acquisition disposition

Kupe (Origin 50%, operator) began commissioning on 4 December, with first gas and liquids piped ashore to Hawera. Full steady production is expected in the next couple of months. This delivers the first gas flagged for the December quarter 2009.

production update

Origin agreed a planned farm-in with Salamander Energy to take 25-40% in five exploration blocks across Thailand, Laos and Vietnam, funding the next US$50m of spending (up to US$40m more on success). Wells start January 2010; completion is subject to final terms and approvals.

farm in farm out agreement

Trefoil 2 reached 3,235m, intersected several gas-bearing sandstones in the target coals and is being plugged and abandoned. Significance will be determined over coming months after analysis; the rig then moves to Rockhopper-1. Appraisal of the 2004 discovery (Origin 39.0%), size not yet stated.

drilling result

Redback South 1 (Origin 67%, operator) began flow testing on 17 November, with initial gas rates up to 38.4 mmscf/day on a 1-inch choke. Origin says flow rate alone does not show discovery size; pressure build-up data will indicate commercial significance. Follows the 22 September discovery.

flow test result

Somerset 1 (Origin 30.75%) reached 2,912m and found only minor gas shows in thin sands that appear water-bearing on logs. Deeper targets were not reached for operational reasons, and the well is being plugged and abandoned. A disappointing exploration result.

drilling result

Origin agreed to buy Woodside's 51.55% of the Otway Gas Project for $712.5m, lifting its stake from 30.75% to about 82%. Funded from existing capacity ($4.4bn). Completion expected by end-2009; subject to pre-emptive rights of Benaris and CalEnergy.

asset acquisition disposition

Origin agreed to farm into Eden Energy's Cooper Basin geothermal licence GEL 185 in South Australia, paying $1m cash and the first $500,000 of spending to earn 70% and operate. It sits beside Geodynamics' licences; subject to SA Government approval.

farm in farm out agreement

Redback South 1 (Origin 67%, AWE 33%) found gas in the uppermost Wagina Sandstone, reaching 3,934m total depth. Gas is similar to the nearby Beharra Springs field; commercial significance depends on flow testing.

drilling result

Origin's FY09 results filing: underlying profit $530m (up 20%), statutory profit $6,941m (boosted by the APLNG transaction), revenue $8,042m (down 3%), EBITDAF $1,219m (down 8%). Final dividend 25c fully franked. Origin reports no net debt.

annual report

Australia Pacific LNG secured the 230-hectare Laird Point site on Curtis Island, Gladstone, for its LNG plant. A KPMG analysis projects an average 10,300 jobs during construction. Final investment decision stays targeted for end 2010, first train by end 2014.

regulatory community update

Origin completed its purchase of 100% of Queensland coal seam gas permit ATP 788P from Pangaea for $660m, funded from existing balance sheet capacity. This closes the deal announced in May; the permit has over 1,000 PJe of expected 3P.

asset acquisition disposition

Australia Pacific LNG's 2P reserves more than doubled to 7,265 PJe and 3P rose about 25% to 12,627 PJe. Origin's own 2P fell from 5,770 to 4,484 PJe, mainly due to the APLNG transaction. ATP788P (over 1,000 PJe 3P) is not yet included.

resource reserve update

Origin signed a deal with Carbon Conscious to plant over six million Mallee trees in 2009-2011 for about $26m, with options to $169m in total if fully exercised. It manages Origin's carbon scheme (CPRS) liability; if the scheme is delayed, credits go to voluntary offsets.

material agreement

AWE reported Apium North-1 (Origin 50%) reached 2,655m with no significant hydrocarbons in the Irwin River Coal Measures. It is being plugged and abandoned, a dry hole. The rig moves to Jingemia-12.

drilling result

Origin signed a conditional agreement with Epic Energy to ship up to 1,200 PJ of gas over 22 years from January 2012 on an expanded South West Queensland Pipeline. It depends on Epic securing funding, which Origin may help provide.

material agreement

Origin, as Kupe operator (50%), said first gas ashore is now expected in the December quarter 2009, with testing and pre-commissioning running later than planned. This pushes back the earlier September-quarter timing. Capital costs remain in line.

production update

NZ Oil & Gas, a Kupe partner, relayed Origin's update: first Kupe gas ashore is now in the fourth quarter of 2009, later than the September-quarter expectation. Capital costs are unchanged and December-quarter output is likely reduced.

production update

Origin lodged Contact Energy's 8 June guidance: full-year underlying earnings after tax are expected 30-33% below last year, from low wholesale prices after high hydro inflows. Origin holds 51.42% of Contact, so this feeds into Origin's own guidance.

other

Origin cut its full-year outlook: underlying profit is now unlikely to be more than 20% higher than last year, versus 20-25% previously. It cites Contact's weaker guidance and about $40m of retail margin foregone in Queensland. Results are due 19 August 2009.

other

Geodynamics said Habanero 3 was brought under control on day 28 after the incident, with flow stopped and two cement plugs set. An investigation will take at least six weeks and drilling is on hold. Origin holds 30% of the JV.

joint venture update

Origin agreed conditionally to take over Babcock & Brown Power's contracts for the 180 MW Osborne cogeneration plant in South Australia for $1, giving power cover to 2018. Expected to add to earnings from FY2009/10; completion is expected in June 2009.

material agreement

Australia Pacific LNG said it will not exercise its right to take ATP 788P, so Origin will acquire 100% for $660m, as agreed 22 April. About 1,150 PJ of 3P reserves are expected on completion, which still needs government approvals.

asset acquisition disposition

Geodynamics expects to attempt to stop the Habanero 3 flow within 1 to 2 weeks and now says the 1MW pilot plant could be delayed about 6 to 9 months. Long-term plans are stated as unaffected. Origin holds 30% of the JV.

joint venture update

Origin bought Wind Power Pty Ltd, adding 1,460 MW of Victorian wind development sites, including the 484 MW Stockyard Hill project, and lifting its wind portfolio to over 2,000 MW. The price was not stated in the text.

asset acquisition disposition

Geodynamics, operator of the Innamincka JV (Origin 30%), reported a well incident at Habanero 3: water and steam flowing to surface on 24 April. No injuries; a well control team was mobilised. A setback for the geothermal project.

joint venture update

Origin agreed to buy 100% of ATP 788P, southern Undulla Nose CSG permit in Queensland, from Pangaea for $660m cash, expecting about 1,150 PJ of 3P reserves (~57c/GJ) at 30 June. APLNG can take the interest before completion; conditions apply.

asset acquisition disposition

The Queensland Co-ordinator General declared the Australia Pacific LNG project (Origin 50%, ConocoPhillips 50%) 'significant', allowing environmental impact statement terms to be set. The project is described as around $35bn of investment, up to four trains and 14-16 Mtpa.

regulatory community update

Karen Moses was appointed a director of Origin as Executive Director, Finance and Strategy. This completes the board seat flagged to follow the February half-year result.

director officer appointment

Construction began on Origin's 550MW, $640m gas-fired Mortlake Power Station in Victoria, with a first-sod ceremony. Bilfinger Berger is the main contractor, Siemens supplies the turbines, and AJ Lucas builds the pipeline carrying Otway Basin gas. Moves a pending project into construction.

contract award

Origin's half-year underlying profit rose 38% to $277m, with statutory profit $6.7bn including the APLNG gain, and revenue up 10% to $4,216m. It has $4,073m cash and $2,313m undrawn facilities. The interim dividend is 25c.

half year report

Origin declared a fully franked 25c interim dividend, up 108%, payable 25 March (record date 10 March). It reaffirmed a final dividend of at least 25c, for at least 50c for the year. The $2.3bn APLNG work program to FID in late 2010 is underway.

dividend declaration

Geodynamics says the closed-loop test is complete, with validation due by end March. Savina 1 stuck pipe could not be recovered and the well is plugged at 2,640m. Origin (30% JV) and Geodynamics are weighing a sidetrack. Pilot plant commissioning is delayed to end April.

joint venture update

Contact Energy (Origin owns 51.36%) says drought, then heavy South Island hydro spill, transmission limits and higher gas costs will cut this year's EBITDAF about 15% and underlying after-tax earnings about 20-23% versus last year.

other

Origin's 640MW Uranquinty gas peaking power station, bought from Babcock and Brown Power for $700m in July 2008, is fully operating with all four 160MW units online. This completes the pending purchase and build.

production update

Partner Pancontinental says Origin will fully fund a 3D seismic survey (minimum US$10m) and all costs for two years from 22 Jan 2009, lifting its earned interest in Kenya L8 to 75%. L8 area shrinks, L9 is relinquished; this follows the pending 21 Jan decision.

farm in farm out agreement

Managing director Grant King's contract is extended five years from 1 July 2009, with fixed pay unchanged at $2.1m and incentives raised to up to 120% each. Karen Moses becomes Executive Director, Finance and Strategy, joining the board after February results. Frank Calabria moves to run Australian energy markets.

director officer appointment

Origin and ConocoPhillips complete formation of Australia Pacific LNG, a 50:50 CSG-to-LNG joint venture, with A$6.9bn received for the US$5bn upfront. It targets a 14 million tonne per annum project, an FID on Train 1 at the end of 2010 and first LNG in 2014.

business combination

The ConocoPhillips deal completes and Origin receives US$5bn (A$6.9bn). It declares an extra 25c fully franked dividend, paid 21 November, and starts a buy-back of up to A$1.275bn on 13 November. Origin now has no net interest-bearing debt.

capital raising announcement

ConocoPhillips receives FIRB approval, so the 50% CSG-to-LNG joint venture is now unconditional. The US$5.0bn upfront payment settles in about a week. This clears the last condition, after which the 25c dividend and buy-back follow.

material agreement

Origin updates the ConocoPhillips deal after the Australian dollar fell: the US$5bn upfront is hedged, and the benefit of depreciation is shared. FIRB is the only condition left. After completion it plans A$1.5bn of returns: 25c extra dividend (A$225m) and buy-back of up to A$1.275bn.

capital raising announcement

Origin confirms BG's takeover offer formally lapsed with conditions unsatisfied at 7pm on 26 September 2008. Shareholders who accepted keep their shares. Ends the BG bid that began in April.

business combination

BG says it will not raise or extend its $15.50 offer and expects it to lapse on 26 September 2008, citing the ConocoPhillips deal price as higher than it can justify. Shareholders who accepted keep their shares if it lapses, ending the takeover threat.

business combination

Origin selects ConocoPhillips to buy 50% of a CSG-to-LNG joint venture for up to A$9.6bn, including US$5.0bn upfront. The deal needs FIRB approval and any approvals required because of BG's offer. Origin says it would have no net debt and plans a $1.5bn capital management initiative; the independent expert values shares at $28.55-$30.71.

asset acquisition disposition

Origin reports FY08 underlying profit up 20% to a record $443m and statutory profit $517m, up 13%. Revenue was $8,275m, with a final dividend of 13c (25c for the year). It targets at least 10% underlying EPS growth in FY09.

annual report

Origin's board unanimously recommends shareholders reject BG's $15.50 offer, giving seven reasons including largest CSG reserves, a possible CSG-to-LNG project and a potential tax liability. The offer closes 26 September unless extended; results are due 28 August.

business combination

Origin (100%) will enter Year 4 of Canterbury Basin permit PEP38262 on 21 August, which commits it to drill. The Carrack/Caravel prospect has a mean 750 million barrels of oil or 2.7 tcf gas if charged; high risk and a deepwater rig is hard to source. It is seeking partners.

drilling scheduled

Chairman's letter urges shareholders to ignore BG and reject the $15.50 bid. It says a short-list of LNG companies are in detailed talks on accelerating CSG development, after significant responses in early July. Target's Statement is due mid-August; results 28 August.

business combination

BG has now sent shareholders its replacement Bidder's Statement. The $15.50 cash offer is dated 4 August and closes 26 September 2008 unless extended. This fills in the offer dates left blank earlier; the board recommends rejection.

business combination

Origin lifts 2P reserves 66% to 5,770 PJe from 3,471 PJe, mostly Queensland CSG (4,751 PJe); CSG 3P reached 10,138 PJ (NSAI). Updates the May CSG figures. It is in talks with global energy companies about a CSG-to-LNG development.

resource reserve update

The Takeovers Panel says Origin has applied about BG's bid documents, alleging misleading statements on the Santos/Petronas deal and CSG reversionary rights, and inadequate disclosure of BG's CSG intentions. Origin seeks interim orders and a corrected replacement statement.

regulatory community update

Origin buys 300MW of electricity hedges for at least 10 years from the Braemar 2 450MW gas-fired station (options over 150MW more), and may supply some of its gas in 2009-10. With Braemar 1, gives Origin up to 825MW of capacity.

material agreement

Momoho 1 found a small gas condensate pool in the Farewell Formation, with a gross column of 2,896 to 2,921m, after reaching 3,145m TD. The well will be plugged and abandoned. Origin calls it the third small hydrocarbon find on this trend; potential remains on the fault's downthrown side.

drilling result

BG Group's Bidder's Statement formally sets out its conditional off-market cash offer of $15.50 per Origin share, dated 10 July 2008. Offer and closing dates are left blank in this text. The Origin board has said it intends to recommend rejecting it.

business combination

Momoho 1 hit good gas shows at 2,896m in the primary Farewell Formation target, at a depth of 2,898m. NZOG says the commercial significance can't be judged until the full reservoir is drilled and logged. Encouraging but unproven for Origin's 50% Kupe partnership.

drilling result

Origin's board intends to recommend rejecting BG's $15.50 bid, citing higher CSG valuations and the ongoing process to invite proposals for its CSG assets. It also announced buying the 640MW Uranquinty power station for $700m enterprise value and committing to the 550MW Mortlake project at an expected $640m.

business combination

BG Group advises it intends to make a conditional cash offer of $15.50 per share for all of Origin. This revives the price rejected on 30 May; shareholders are told to take no action for now.

business combination

Drilling has started on Momoho 1, an exploration well six kilometres southeast of the Kupe field that could hold oil, gas or both. It sits between two earlier wells that found sub-commercial gas and oil; about 40 days of drilling are planned. Origin holds 50%.

drilling spud

Origin's independently assessed coal seam gas reserves rose: 2P up 91% to 4,715 PJ and 3P up 121% to 10,122 PJ as at 15 May 2008. It also reports 13,497 PJ of contingent resources. The review was brought forward given BG's proposal.

resource reserve update

Origin's board rejected BG's revised A$15.50 cash scheme proposal, up from A$14.70. It cited the 121% jump in coal seam gas reserves and the Santos-Petronas Gladstone LNG deal, and says third-party approaches may create more value. This resolves the BG thread.

other

Freshwater Point 1 was a dry hole: total depth 1,817m, with no hydrocarbons interpreted in the primary or secondary targets. It was plugged and abandoned on 29 May. This resolves the Perth Basin well Origin operates with 49.189%.

drilling result

NZOG says the Momoho exploration well, about 5.5km from the Kupe platform, is due to start in late May after the Kupe development wells. NZOG's P50 estimate is 200 BCF equivalent if hydrocarbons are found, with no-hydrocarbon or sub-commercial outcomes possible.

drilling scheduled

BG Group approaches Origin with a proposal to buy all shares for A$14.70 cash each, subject to shareholder and regulatory approvals. Origin has not yet considered it, and talks may not lead to a deal. Shareholders are told to take no action.

business combination

Origin signs a gas supply agreement with the Esso Australia–BHP Billiton Gippsland Basin joint venture to buy up to 250 PJ over 10 years, starting late 2009 as the Gascor contract ends. It supports retail demand and the proposed Mortlake power station.

material agreement

Contact Energy (Origin 51.36%) signed contracts with GE and United Group (NZ) for two 100MW gas peaking units at Stratford, costing about $250m. In service is expected before winter 2010, alongside the Ahuroa gas storage facility.

contract award

The Kupe JV (Origin 50% operator) will drill the Momoho exploration well from May, 6km south of the Kupe field, to about 3,150m, before the Ensco 107 rig is released. A discovery could possibly connect to the Kupe platform.

drilling scheduled

Origin raised $1.54bn, including $420m of oversubscriptions, from syndicating the 3-year credit facility announced on 11 February. Margin is 65 basis points over base rate; it is senior unsecured, A$1.32bn plus a US$200m tranche, to fund growth capex.

debt financing

Origin reports first-half underlying profit of $200m, down 3%, but statutory profit up 44% to $335m. Interim dividend rises 20% to 12 cents. Directors now expect full-year profit growth of at least 15%, up from the earlier 10-15% guidance, on a stronger second half.

half year report

Riverslea Southeast-1 reached 1,585m with only weak oil shows in poorly developed upper Boxvale Sandstone and will be plugged and abandoned. A dry hole for Origin (88.2% of the well incl. subsidiaries) in a small near-field exploration test.

drilling result

Origin signs an underwritten 3-year senior unsecured credit facility: A$900m revolving and term tranches plus a US$200m revolving tranche, with five banks. To fund growth projects including Darling Downs and coal seam gas. Ratings BBB+ stable; syndication due March 2008.

debt financing

Origin buys Woodside's 62.5% of the VIC/P37(V) permit for $13.6m, taking 100% of the Halladale and Black Watch gas fields (55 PJe contingent resource, found 2005). Intended to support retail and the proposed Mortlake power station; subject to regulatory approval.

asset acquisition disposition

Emu Apple 3 reached 1,484m with good oil shows and was cased as a future producer. A test of the Hutton Sandstone recovered 6.1 barrels of oil, a new oil pool for the Emu Apple field. Origin holds 90% via subsidiaries, Santos 10%.

drilling result

Origin commits $92m to add a 126MW GE gas turbine at the Mt Stuart peaking station in Townsville, a 45% rise on the existing 288MW. Planned completion by mid-2009. Adds to Darling Downs and Quarantine as part of Origin's new generation build.

material agreement

Origin takes an option over up to 590MW of Epuron wind projects, starting with building the 30MW Cullerin Range wind farm in NSW, with commissioning from 2009. It is Origin's first self-built wind farm and first NSW generation investment. No price is given.

material agreement

A fire on 24 December shut the Beharra Springs gas plant (Origin 67% operator, ARC 33%). No one was hurt; the cause is unknown. Origin anticipates the plant will be operational before the end of January. The plant produces about 10TJ/day.

production update

Origin, as Kupe operator (50%), confirms the Ensco 107 rig has started batch drilling three development wells, about 3,400m deep each, taking around five months. Platform installation went smoothly. Completion is still expected by mid-2009.

drilling spud

Geodynamics shareholders approved Origin's 30% geothermal joint venture at the 19 December meeting, leaving no outstanding conditions. Origin commits $96m, plus $9.6m if Stage One is completed on time and budget. Resolves the pending 29 October farm-in.

farm in farm out completion

Origin and Contact (Origin 51.36%) will buy Swift Energy's New Zealand Taranaki oil and gas assets for about US$87.8m (NZ$115m), including two producing areas, processing stations and pipelines. Contact contributes about NZ$54m for the Ahuroa gas storage rights. Origin also gets 50% of two offshore permits near Kupe. Completion is expected in Q1 2008, subject to Overseas Investment Office consent.

asset acquisition disposition

Moana 1 (Origin one third) reached 3,674m with no significant hydrocarbon shows in the primary reservoir and will be plugged and abandoned. A dry hole for Origin's New Zealand exploration.

drilling result

Origin signs a binding heads of agreement for a 30% stake in Geodynamics' South Australian geothermal tenements, committing $96m of project spending plus 30% of ongoing costs, and a further $9.6m if Stage One is met. It keeps its 10% Geodynamics shareholding. Needs Geodynamics shareholder approval in December.

farm in farm out agreement

Contact says its New Plymouth power station will be closed at least six months over asbestos. Two units could return by May 2008 if remedial work goes ahead, but permanent closure cannot be ruled out. Escalates the outage from three to four weeks.

regulatory community update

Woodside reports the Otway plant produced 198 TJ from 16 September (Origin share 61 TJ) but has been shut in since 24 September for start-up issues, including a glycol pipeline leak. Steady production is expected by January. Delays the ramp-up after first gas on 17 September.

production update

Origin's subsidiary completed the NZ$200m preference share issue on 9 October, with a 10.23% dividend rate to October 2008 (8.73% benchmark plus 1.50%). Trading on the NZ exchange starts 10 October. Closes the offer opened 4 September.

capital raising announcement

Beharra Springs 4 (Origin 67%, operator; ARC 33%) hit gas at 3,337m and stabilised at about 35 million cubic feet a day through a 1-inch choke. Early indications suggest partial pressure communication with the existing field. Drilling to 3,374m resumes.

flow test result

Woodside reports the Otway Gas plant has started gas export, with output expected to rise in coming weeks and condensate and LPG to follow. Origin holds 30.75%. This resolves the end-August first sales thread, about two weeks later than flagged.

production update

The NZ$200m preference share offer (NZ$50m oversubscriptions possible) opened 4 September and closes 5 October, with issue on 9 October. The dividend is at least 10%, and the shares are rated BBB-/BBB. Proceeds repay bank debt tied to Origin's 51.4% Contact stake.

capital raising announcement

Origin and the BassGas joint venturers agreed to settle the Clough arbitration, and proceedings will be discontinued. This ends the dispute, with a hearing on the amount previously planned for April 2008. Settlement terms and any cost are not disclosed.

material agreement

Origin lodges its full-year 2007 accounts and management discussion: statutory profit $456.9m (up 38%), underlying profit $370.2m (up 10%), final dividend 11c fully franked, EBITDAF $1,201m. Cover letter; the detail is in the media release.

annual report

Origin reports FY07 statutory profit of $457m (up 38%) and underlying profit of $370m (up 10%), with total dividends of 21c (up 17%). Management targets about 15% underlying profit growth for 2007/08.

annual report

A wholly-owned Origin subsidiary is considering a NZ$200m preference share offer in New Zealand (NZ$50m oversubscriptions), expected to open 3 September. Proceeds would refinance bank debt tied to Origin's 51.4% Contact Energy stake. This is the previously flagged possible hybrid-style funding.

capital raising announcement

Origin lifts 2P reserves 42% to 3,471 PJe from 2,436, with coal seam gas up 1,095 PJe (80%) to 2,470 PJe. Record FY07 sales revenue of $475m; Otway Gas Project first sales expected by end of August.

resource reserve update

Origin signs a 20-year gas supply agreement with Rio Tinto Aluminium for 470 PJ of coal seam gas to its Yarwun refinery, starting between March and July 2010 and ramping to 22.8 PJ a year. Origin expects to spend about $260m developing Walloon gas fields.

contract award

Origin completes the sale of its Networks business to APA for $556.5m, including its 33.3% SEA Gas stake ($133.2m, completed 29 June) and its 17% Envestra stake. This resolves the sale agreed on 4 April, on the expected July timing.

asset acquisition disposition

ARC reports Drakea 2 (Origin 50%) found hydrocarbons in the High Cliff and Kingia Sandstones but with low permeability, so commercial production at this location is unlikely. The well is suspended for possible re-entry. This resolves the sidetrack hope from Drakea 1.

drilling result

Origin agrees a heads of agreement for ARC to take 40% of Bass Basin permit T/44P (granted 100% to Origin in the March quarter) by reimbursing Origin's back-costs, with an option for a further 10%. It is subject to formal documents and approvals; seismic is planned for early 2008 and a well later.

farm in farm out agreement

Origin commits to build the 630MW Darling Downs gas-fired power station near Braemar, Qld, with $780m of contracts signed with GE and CH2M Hill. About $500m more goes to Spring Gully and Walloon gas development. Commissioning is due Q4 2009, resolving the pending decision on Darling Downs.

material agreement

The first stage of the BassGas arbitration favours the joint venture, which Origin operates (Origin 42.5%). It dismisses Clough's $95.7m Trade Practices claim and finds Clough liable for most first-tranche defects. Amounts are to be set at an April 2008 hearing, later than the earlier expectation of an award in the first half of 2007.

joint venture update

ARC reports Drakea 1 (Origin 50%) reached 3,080m and found an oil column of about 3-5m at the top of the roughly 35m-thick High Cliff Sandstone. The joint venture is considering a seven-day sidetrack to a higher position.

drilling result

Origin confirms its own notice that Drakea 1 (Origin 50%, ARC operator) started drilling 11 May 2007 in Perth Basin L1, targeting the High Cliff Sandstone at about 2,589m, with planned total depth of about 2,839m. Repeats ARC's release.

drilling spud

Origin commits $80m to add a 120 MW gas peaking unit beside its existing 95 MW Quarantine Power Station near Adelaide, signing a General Electric turbine contract. Completion is expected in the December quarter 2008, in time for summer 2008/09.

material agreement

Origin completes the sale of New Zealand LPG distributor Rockgas to Contact Energy, announced 6 March 2007, for a one-off NZ$156m. Origin says the sale will not materially affect its consolidated results.

asset acquisition disposition

AWE will take an extra 7.4% of the Trefoil/White Ibis T/18P permit from Origin, lifting it to 30% and carrying part of Origin's forward exploration spend. Origin also buys AWE's 24.29% onshore Otway Basin interests for $5m cash.

farm in farm out agreement

Origin agrees to sell its Networks business (Envestra management, 17% Envestra, 33.3% SEA Gas) to APA for $556.5m, resolving the sale process begun after Sun Retail. It is conditional on Envestra consents to transfer the management agreements.

asset acquisition disposition

Origin commits a further $53m to lift Spring Gully coal seam gas output by 20 TJ/d and build a water treatment plant, on top of the $114m expansion announced last July. It will serve Incitec Pivot contracts from the second half of 2007.

production update

Origin says Jingemia 11 hit the Dongara Sandstone at 2,489m, about 10m updip of the field's previous highest well. Early logs suggest the full ~31m reservoir is likely oil-saturated. Well will be drilled to 2,614m and connected to the Jingemia facility.

drilling result

AGL's managing director said AGL will not pursue its merger-of-equals proposal, saying Origin rejected it and refused to engage. This resolves the open question of whether AGL would return after Origin's 23 Feb rejection.

business combination

Origin agreed to sell Rockgas, New Zealand's largest LPG distributor, to its 51.36%-owned Contact Energy for NZ$156m, with completion due in the second quarter of 2007. Origin says the sale has no material impact on its consolidated results and it keeps LPG supply contracts with Rockgas.

asset acquisition disposition

Half-year to 31 Dec 2006: net profit $233m (up 20%), EBITDA $640m (up 9%), EPS 29.0 cents. Fully franked 10 cent dividend (up 11%) payable 30 March. Exploration & Production EBITDA rose 38%; Mount Stuart contract termination added $19.6m.

half year report

Share Purchase Plan closed oversubscribed: $262m applied against a $75m target, scaled back to a 200-share cap, raising $83m at $7.10 (about 11.7m shares). Completes the equity funding for the Sun Retail acquisition.

capital raising announcement

Origin has been offered a new 100% Bass Basin permit (T06-4) next to Trefoil and White Ibis gas discoveries, committing to seismic and one well in three years. Also seismic plans in NZ Canterbury and Northland, and Kenya L8/L9 decision due 3Q 2007; seeking exploration partners.

regulatory community update

Origin's board rejected AGL's nil-premium merger of equals, citing relative value, value leakage from required divestments and its own growth outlook. Resolves the talks that began 5 Feb; Origin will focus on its existing business and Sun Retail integration.

business combination

Eremia 7 (Origin 50%) reached 2,996m and hit the Dongara Sandstone about 12m high to prognosis, with an 11m oil column. It will be cased as an oil producer; a good sign for Eremia field reserves.

drilling result

Origin accelerates a roughly 500MW gas-fired Darling Downs power station near Braemar, gained with Sun Retail, alongside the 1,000MW Spring Gully plan. Final investment decision stays on track for Q2 2007 (previously March quarter, Spring Gully).

other

Origin confirms it has entered merger discussions with AGL Energy, moving on from evaluating AGL's 4 January approach. It warns there is no certainty of an agreed proposal.

business combination

Origin completes the $1,202m purchase of Sun Retail from the Queensland Government, adding about 840,000 electricity and 55,000 LPG customers. Funded by the $400m placement, a planned $75m share purchase plan and debt.

asset acquisition disposition

Origin is proceeding with the sale of its Networks business (Envestra manager, 17% of Envestra, 33.3% of SEA Gas) after strong interest, and says it is confident of completing a sale. Follows the 27 November review; no price or buyer named.

asset acquisition disposition

Alinta says it will not bid for Origin's infrastructure assets (17% Envestra, 33.3% SEA Gas, asset management), and has asked the competition regulator to end its inquiries. This ends the Alinta thread; the AGL approach remains.

business combination

Origin opens a share purchase plan of up to $5,000 per eligible holder, aiming to raise up to $75m toward Sun Retail. The price is the lower of $7.10 or the 8–19 January average price less 2.5%. Offer closes 19 February 2007.

capital raising announcement

The competition regulator has begun inquiries into Alinta's proposed purchase of Origin's gas infrastructure assets, including its 17% Envestra stake and 33.3% of the SEA Gas pipeline. Submissions are due 29 January 2007. Follows Origin's Networks ownership review.

regulatory community update

AGL confirms it has made a preliminary approach to Origin for a nil-premium scrip merger to form an integrated energy major. It cites gas reserve and cost benefits and is working on competition (ACCC) issues. A potential takeover-style combination, not agreed.

business combination

Origin confirms it received an unsolicited, indicative and preliminary merger approach from AGL, but says it is not currently in discussions. It will complete an evaluation first and tell the market if it decides to proceed.

business combination

ARC reports Lyginia 1 (Origin 50%) reached 2,345m and found the Dongara Sandstone 12m deeper than expected, but preliminary logs show no hydrocarbons. It is a dry first exploration well after the Eremia 6 and other Perth Basin successes.

drilling result

Origin's own release confirms Lyginia 1 (Origin 50%) reached 2,345m; the Dongara Sandstone came in about 12m deeper than expected and logs indicate no hydrocarbons. The well is being plugged and abandoned. Repeats the ARC result already reported: a dry first exploration well.

drilling result

Origin completes its $400m placement of about 56.3m shares at $7.10, a 2.6% discount to the 24 November close. Proceeds part-fund Sun Retail. A share purchase plan of up to $5,000 per holder is planned for early 2007.

capital raising announcement

ARC reports Eremia 6 (Origin 50%) flowed 3,790 barrels of oil a day on test, with no water, from an 8m interval. It is the third strong Perth Basin development well after Jingemia 8 and Hovea 12; a permanent flowline is due in about three weeks.

flow test result

Origin agrees to buy Sun Retail from the Queensland Government for $1,202m: 833,000 retail customers, wholesale and LPG businesses. Settlement is 1 February 2007. Funded by a $400m placement and debt, with a share purchase plan, a possible hybrid and a Networks review. Resolves the Queensland tender.

asset acquisition disposition

ARC reports Eremia 6 (Origin 50%) reached 2,315m and, on early logging-while-drilling data, found a 23m oil column in the Dongara Sandstone, 8m higher than any prior field intersection. Suggests an undrained part of the field, resolving the Eremia 5 miss; wireline confirmation still needed.

drilling result

Origin reports clean-up flows of 3,520 bopd at Jingemia 8 (49.189%) and 3,230 bopd at Hovea 12 (50%). Both are being tied in, and sustainable rates will be tested over two weeks. This resolves the open completion threads for both wells.

well test result

Woodside says the Otway Gas Project (Origin 30.75%) is delayed by onshore gas plant construction. Start-up readiness moves to the end of the March quarter 2007, from the Q4 2006 expected earlier. Wells, platform and pipeline are finished.

production update

Origin marks the official opening of BassGas (Origin 42.5% in total, $750m cost), which reached contractual production levels after starting in June 2006. It expects about 23 PJ a year of gas. Endurance testing is nearly complete. This follows the earlier ramp-up.

production update

Origin confirms Kenya approved the deeds for Blocks L8/L9, so its farm-in is complete and it holds 75%. It must fund at least US$4m of 2D seismic, due to start December 2006. A 3,000m well is required if it continues.

farm in farm out completion

Pancontinental says Kenya's government executed the deeds for Blocks L8/L9, satisfying the farm-in condition so Origin now holds 75%. Origin must fund at least US$4m of 2D seismic by October 2007. It can drop out of drilling by 14 July 2007.

farm in farm out completion

Origin agreed with Enertrade to end the power purchase agreement for its 288 MW Mt Stuart peaking plant from 31 December 2006. Origin will then decide when the plant runs, and it will keep its peak and grid-support roles.

material agreement termination

Queensland's Co-ordinator General recommended approval of the 1,000 MW Spring Gully power station, a step before the Bungil Shire's development approval. The Origin board will consider it in the March 2007 quarter; it would be built in two 500 MW stages.

regulatory community update

Origin issued tenders for the first 500 MW of a nominal 1,000 MW coal seam gas power station at Spring Gully. The board will decide whether to build around the end of the March 2007 quarter; construction would take two and a half years.

regulatory community update

Origin, as Kupe operator, awarded the US$200m contract for the NZ$980m Kupe project's development to Technip, confirming the earlier alliance. Platform installation starts in the March quarter of 2007, with production by the first half of 2009.

contract award

Origin confirms Jingemia 8 (49.189%) found oil-saturated Dongara Sandstone from 2,482m, about 30m above the original oil-water contact. Pressure data shows it is not connected to the rest of the field. The well will be completed and connected to the Jingemia facility.

drilling result

Origin reported FY2006 profit of $332m, up 10%, on revenue of $5,950m, with a final dividend of 9c (18c for the year). Exploration and Production EBITDA fell 11% to $205m. Guidance is for production to reach about 100 PJe a year by year end, from 78 PJe.

annual report

Origin will spend a further $114m to double Spring Gully coal seam gas capacity to about 85 TJ/d, supplying QAL, Incitec Pivot and Energex. This follows the Phase 3 and 4 expansion already noted. It is also seeking approval for a 1,000 MW power station on the site.

material agreement

BassGas has begun selling gas (mid-May) and liquids (June), with ramp-up continuing. Cost has risen from $450m to about $750m after rectification work. Arbitration against builder Clough is not expected to conclude until late 2007; Origin's claim is about $100m.

production update

Origin, as 50% operator, announced the Kupe joint venture's go-ahead: cost now estimated at NZ$980m, reserves up about 15% to 389 PJe, online mid-2009 at about 20 PJ a year of gas. Resolves the pending decision; production is a year later than the 2008 previously expected.

material agreement

Origin and Contact agreed to terminate the dual-listed merger agreement signed 20 February 2006, because Origin saw insufficient support from key Contact shareholders. Origin would not improve terms for Contact minorities. Origin keeps its 51.4% Contact stake and Kupe operatorship.

material agreement termination

Emu Apple 1 (Origin 90%, Santos 10%) is a new oil pool discovery: Boxvale Sandstone recovered 10.5 barrels of 35.5 API oil on test. A deeper zone flowed water. The well is cased and suspended pending completion as an oil producer; the rig moves to Ooline 1.

drilling result

Braeburn 1 (Origin 100%) reached 2,125 metres with only a trace of gas and condensate on test; other targets were tight or water-bearing. The well is being plugged and abandoned, a dry hole. The rig moves to Emu Apple 1.

drilling result

Origin and Contact report in-principle approvals from the NZ Takeovers Panel, ASIC and ASX, plus Foreign Investment Review Board approval for the merger. NZX and Overseas Investment Office approvals are pending. Meetings are now expected by early August, completion by end August 2006.

business combination

Origin named Technip Oceania preferred contractor for both the onshore and offshore parts of the Kupe project (Origin 50%), with an alliance team to be formed if the final investment decision proceeds. That decision is still expected later this half-year.

contract award

Origin discovered new gas pools in the Surat Basin at Ogilvie Creek 1 and 2 (100%). Ogilvie Creek 2 flowed 5.1 mmcfd; Ogilvie Creek 1 flowed 0.4 mmcfd from a separate accumulation. Both wells will be tied in to Myall Creek for long-term testing.

drilling result

BassGas commissioning is taking longer because of unexpected construction defects. First product sales now expected in May, not April as previously guided, with ramp-up into June. Origin does not expect a significant financial contribution this financial year, to 30 June 2006. Lang Lang plant got a three-year operating licence.

production update

David Baldwin, from Ritchie Capital and formerly MidAmerican Energy, will be seconded from Origin to be Contact Energy's CEO from 1 May 2006. He fills the vacancy left by David Hunt's February resignation. Contact reimburses Origin for his pay, fixed $650,000 a year.

director officer appointment

Technip Oceania was named preferred tenderer to build the onshore Kupe gas production station in New Zealand. Origin calls it an important step toward the final investment decision, still timed for the first half of 2006, with production in 2008. Origin holds 50%.

contract award

Origin and Contact Energy agreed to merge via a dual-listed company structure, ContactOrigin, with a combined value over A$7 billion. Origin shareholders would hold 75.7%, Contact minorities 24.3%. Origin's 51.4% Contact stake is amalgamated. Subject to regulatory, court and shareholder approval.

business combination

Half-year profit to December 2005 rose 14% to $193.7 million on revenue of $3,008 million, helped by a full six months of Contact. Interim dividend is 9 cents, up 29%. Full-year earnings still expected 10-15% above restated prior year; BassGas full output in fourth quarter.

half year report

Snottygobble 1 flowed gas at only about 0.5 million cubic feet a day on test, against a pre-drill estimate of 20 BCF. ARC calls it 'more like a sniffle than a sneeze' and pauses onshore drilling until mid-year. Origin was not in the well.

flow test result

Kyeen Creek 1 reached 2,587 metres and found only thin shows with low permeability. It is being plugged and abandoned, a dry hole. The rig moves to the Merriwee oil well in PL14. This resolves the earlier weak Basal Rewan test.

drilling result

Origin won two offshore Northland Basin exploration permits in New Zealand (PEP 38618 and 38619). It holds 50% as operator, with OMV holding the rest. Seismic surveys are being planned.

asset acquisition disposition

Origin agreed to buy Pangaea's stakes in the Argyle coal seam gas project in Queensland for $70 million. The 40.625% Argyle interest carries 117 PJ of 2P reserves, about 30 PJ already contracted to Incitec Pivot. It sits next to Origin's Talinga project. Subject to approvals.

asset acquisition disposition

ENSCO won the contract to drill three development wells at the Kupe gas field in New Zealand, starting in the first half of 2007. Origin holds 50% as operator. A final investment decision is expected in the first half of 2006, with production in 2008.

contract award

Origin says the BassGas Project start-up is delayed about one month. Product sales are now expected from March and full production from late April 2006. Origin holds 37.5% as operator plus 5% through a subsidiary.

production update