(Adds comment on new PNG govt, production, capital spending)
Aug 22 (Reuters) - Australia's Oil Search Ltd (OSH) reported a five-fold jump in half-year profit on higher oil and gas prices and lower costs, and said it expects its partners to agree by the end of the year on how to coordinate development of their gas projects in Papua New Guinea (PNG).
Net profit rose to $129.1 million for the six months to June from $25.6 million a year ago, in line with three analysts' estimates.
The oil and gas explorer declared an interim dividend of 4 cents a share, up from 1 cent a year ago and in line with analysts' forecasts.
Oil Search is a partner in the PNG LNG project and P’nyang field, operated by ExxonMobil Corp
, as well as a partner in the undeveloped Elk-Antelope gas assets operated by France’s Total SA . The two projects are in talks over how best to develop their gas fields without spending billions of dollars duplicating infrastructure, with plans that could double output from the PNG LNG plant by the mid-2020s.
"Oil Search believes that the most likely development scenario will involve the sharing of downstream infrastructure, through the location of at least eight million tonnes per annum of additional LNG capacity on the existing PNG LNG Project plant site," it said.
PNG is seen as one of the most attractive places in the world to develop LNG projects, thanks to the quality of its gas, low costs and proximity to Asia's big LNG consumers.
The newly elected PNG government is working on a 100-day plan, due to be released this week, which places high priority on LNG expansion plans, Oil Search said in a statement.
Oil Search cut its capital expenditure forecast range for the year to $350 million and $400 million from its previous guidance of $380 million and $480 million.
It also raised the lower end of its full-year production guidance range to now expect production of between 29 million and 30.5 million barrels of oil equivalent for 2017.
Shares of the Papua New Guinea-based company rose as much as 4.4 percent after the result, their biggest intraday percentage gain in over seven weeks.
