The ASX-listed, Papua New Guinea-focused company reported total operating revenue of $US151.3 million ($A202.2 million) for the quarter ended December 31, 2004. This was a 74% increase on the third quarter and a 50% improvement on the previous corresponding period.

This brought total operating revenue for the full year 2004 to a record $US400 million, 19% higher than in 2003.

Oil and gas production in the fourth quarter was 2.90 million barrels of oil equivalent (boe), an increase of 14% on the third quarter.

Production for the full year was a record 11.05 million boe, compared to 10.4 million boe in 2003.

At the end of 2004, Oil Search had cash of US$209m and debt of US$168 million.

Oil Search managing director Peter Botten said 2005 should be even better for the company.

"Oil production is forecast to grow again in 2005, with three new sources to come onstream during the year," he said.

These sources are the NW Moran and SE Mananda developments in PNG and the Nabrajah field in Block 43 in Yemen.