Origin Energy chief executive Grant King says dividends to shareholders and capital spending plans will escape an impact from the oil price slump, thanks to the company's limited exposure to the commodity.
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Mr King also insisted the economics of Origin's $24.7 billion Australia Pacific Liquefied Natural Gas project in Queensland would remain profitable even after the sharp drop in prices.
"Lower prices mean lower revenues and lower returns but that doesn't mean it is uneconomic," he said. "We are still comfortable with the project."
Mr King's comments tie in with the decision by Standard & Poor's earlier on Friday to leave Origin's BBB credit rating unchanged even after slashing its oil price assumptions.
S&P said on Friday that its reduction in assumed prices for Brent crude oil has only "limited impact" on Origin's financial metrics in 2015-16, the key focus of its analysis. It has a negative outlook on Origin's rating.
In contrast, ratings on some other oil and gas players such as Santos are understood to be under review.
Earlier this week, the ratings agency reduced its assumptions for average Brent crude oil prices for 2015 by $US10 a barrel to $US80 (95.20) a barrel, and cut its 2016 average assumption by $US5 to $US85 a barrel.
Price drop will have little impact on Origin
Brent crude was under $US70 a barrel in the Asian trading day on Friday. Mr King said the drop in prices would have relatively little effect on Origin.
"It's not that big an impact because we're just not that big an oil producer at the moment, and we won't be a big oil producer in two, three or five years, it's just the fact that LNG is linked to oil."
Origin's APLNG project is due to begin production in mid-2015, and some analysts have estimated that rates of return would be well down into single figures at current prices.
Others say those calculations ignore the offsetting impact of the weaker Australian dollar, and the protection built into its LNG sales contracts through so-called "S curves", which include a floor for oil prices.
Mr King said Origin had believed for some time that the inexorable rise in US shale liquids production would have an impact on global crude prices, but it had been very difficult to say when.
"History tells us that when prices of any commodity move, they tend to move dramatically," he said.
Santos the worst hit
Mr King noted that the recovery in commodity prices could also be swift, but he voiced no confidence in any rapid rebound in crude oil. "I'm not sure I'd say oil is going to be a hundred bucks in six months," he said. In contrast to the stability of Origin's ratings, Santos is widely expected to see pressure on its BBB+ rating with negative outlook as a result of the lower oil price assumptions.
Santos has been the worst hit of the larger listed energy stocks from the slump in oil prices, losing 27 per cent of its market value since last Thursday.
The impact is due to its lower-margin portfolio of projects, as well as the perceived risks to its credit rating, although shorting of the stock by hedge funds is also being blamed.
"Santos has been heavily attacked by hedge funds shorting the stock since oil price started falling," said John Colnan at Shaw Stockbroking.
"Over the last month and on many given days, 30-50 per cent of traded volume is shorting."
The hit to the shares of Origin and Woodside Petroleum has been mild in contrast, with Origin falling by about 15¢ over the past week and Woodside by 7.3 per cent.
