Profit for calendar 2008 rose 128.4 per cent on the previous corresponding period to $US313.36 million ($487.72 million) due to higher oil prices in the first half.
Underlying profit, before significant items, increased 70.4 per cent to $US239.96 million after a 13.3 per cent rise in revenue to $US814.33 million.
Oil Search managing director Peter Botten said discretionary spending on exploration would be cut back during the year due to lower oil prices and cashflows.
"It is a particularly dynamic time in the world economic and commodity markets - a time that requires proactive management of all facets of our business to ensure continued superior performance," Mr Botten said in a statement.
Oil Search (osh.ASX:Quote,News) will reduce its exploration expenditure to $US70 million in 2009, down from $US176 million in the 2008 fiscal year.
The company also will cut its development expenditure to $US130 million own from $US162 million in 2008.
"Based on a $US40 per barrel scenario, a number of previously planned infill development wells and work-over activity in PNG have been deferred, to be reviewed again should oil prices recover," Mr Botten said.
The company has forecast output during the 2009 fiscal year to be in the range of eight million barrels of oil equivalent (mmboe) to 8.3 mmboe.
Oil Search produced 8.579 mmboe in calendar 2008.
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