The first cargo of Pluto LNG sets sail for Japan. Picture: Woodside Petroleum.
The first cargo of Pluto LNG sets sail for Japan. Picture: Woodside Petroleum.

UPDATE 7.25am: Woodside Petroleum has provided first insights into the development concept for Leviathan, the massive gas field of Israel it is in the throes of buying into, by declaring that all gas processing will happen at sea.

Chief executive Peter Coleman said the offshore solution replaced earlier plans for an onshore gas processing hub in Israel.

But it remained to be seen whether the Leviathan partners would use pipelines or a floating LNG facility to export gas to customers outside of Israel.

Woodside has set a March 27 deadline to finalise a deal with the Leviathan partners, led by operator Noble Energy, to acquire a 25 per cent stake in the field's permits.

Speaking alongside Woodside's full-year profit announcement this morning, Mr Coleman said planning for a first-up, domestic gas phase for Leviathan was well advanced while front-end engineering and design studies for the second-phase export development were likely to start late this year, for a possible final investment decision trigger point in late 2015.

Mr Coleman said the start-up of Leviathan, with a domestic gas project, was expected to fill a void in Woodside's near-term production growth ambitions as the company waited for bigger ventures, such as Leviathan's second stage and the Browse FLNG development, to be completed.

Mr Coleman was speaking after Woodside announced it had followed up on a record-breaking production performance in 2013 with the second best full-year profit in the company's 59-year history.

Woodside this morning announced a $US1.75 billion after-tax profit for the year to December 31, in line with analysts' consensus.

The profit included $US387 million of impairments, including a $US58 million write-off of Pluto expansion work and a $US154 million charge to the Enfield oil project.

The profit was eclipsed only by the 2012 net result of $US2.98 billion, which was boosted by the successful sale of a big stake in Woodside's Browse project, with provided a $US974 million gain, as well as a higher mix of oil-to-gas revenues.

Mr Coleman said the past year had been exceptional but also one highlighted by Woodside "making the tough decisions", such as walking away from plans for an LNG plant development at James Price Point.

He described Woodside's financial position as "excellent".

Woodside produced 87 million barrels of oil equivalent last year, driven by a strong performance from its 90 per cent owned Pluto LNG plant.

Free cash flow was $US2.27 billion and net debt was reduced another 20 per cent to $US1.54 billion.

Woodside's board declared a record final dividend of $US1.03 a share, up 58 per cent on 2012.

Woodside had promised higher dividends in the lead-up to the profit result announcement.

Woodside shares were up five cents to $38.55 at 7.25am.

The West Australian

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