AUSTRALIAN energy giant Woodside Petroleum has recorded an increase in quarterly production and revenue, but left investors feeling uneasy after flagging impairments to the tune of US$400 million.

In its fourth quarter report to the end of December, Woodside managed a 5.9 per cent increase in output on the third quarter with production tipping in at 23.2 million barrels of oil equivalent (MMboe). The company attributed the increase in production volumes to increased output from Pluto following the re-start of the liquefied natural gas train as well as the change-out of dehydrator beds during Q3.

While revenue for the quarter represented a 23.2% increase on Q3 to $1.65 billion, the result was 6.7% lower than the revenue achieved in the 2012 fourth quarter of $1.77. The average Brent price for the three-month period was $109.35 per barrel, slightly below the $110.13/bbl in the corresponding period.

For 2013, Woodside achieved record annual production within guidance of 87 Mmboe, up 2.5% on 2012. Despite the increase, revenues dropped 7.2%, albeit, to $5.78 billion.

Some of the highlights of the fourth quarter included the North Rankin redevelopment project achieving start-up, while oil production at its Vincent Field restarted on 29 November. The refurbished Vincent floating production, storage and offloading vessel is expected to contribute to a higher share of oil output in 2014.

Woodside also warned shareholders that it expected to book a full-year impairment of $380-$400 million on some of its oil and gas properties would have made investors nervous.

Woodside said the proposed impairment figure included adjustments to the carrying values of Stybarrow, Enfield, Laminaria Corallina.

However, the impairments could be partially offset with an expected $200-$250 million benefit from the Petroleum Resource Rent Tax for 2013.

For 2014, Woodside is targeting production of between 86 to 93 Mmboe, of which the majority will come from Pluto LNG.

2014 looks to be another busy year for the company, which developments both at home in Australia and overseas.

Woodside said it hoped to be in a position to consider the start of front-end engineering and design for the Browse floating liquefied natural gas project off the coast of Western Australia in the second half of the year.

Work will also continue on the A$2.5 billion Greater Western Flank phase one project. The project is 63% complete and remains on schedule for start-up in early 2016.

Further afield to the Sunrise LNG project in the Timor Sea, Woodside said it remained stalled by the dispute between the Australian and Timor-Leste government, but reiterated its commitment to developing Greater Sunrise once a resolution is achieved.

As for Leviathan, Woodside is still waiting for the Israeli government to finalise its tax policy settings for gas exports, which it expects to gain clarity on in the first half of 2014.

Woodside will release its full-year earnings on 19 February.