Shares of oil and gas producer, Oil Search Limited (ASX: OSH), slumped as much as 6% lower today after the company released its quarterly production report.

In an ASX announcement, Oil Search reported a 1% increase in production, from 7.42 mmboe (million barrels of oil equivalent) to 7.51 mmboe, for the quarter ended 31 December 2015.

Total sales also rose 1% to 7.13 mmboe during the quarter. However, revenue fell 10% to $US342.9 million as a result of falling commodity prices.

Over the full year, Oil Search’s production was a whopping 52% higher, but its revenue fell 2% to $US1,585.7 million.

During the quarter, rival Woodside Petroleum Limited (ASX: WPL) withdrew its non-binding takeover offer of Oil Search.

“Following a strong performance from both the PNG LNG Project and our operated oil fields during the fourth quarter, 2015 full year production was 29.3 mmboe, which was an all-time record for the Company and above the top end of our 27 – 29 mmboe guidance range,” Managing Director, Peter Botten, said. “Despite the present oil price weakness, the PNG LNG Project co-venturers remain committed to pursuing PNG LNG Project expansion activities, as maximising production through the existing trains and the construction of a potential third train continues to offer attractive returns.”

At the reporting date, Oil Search said it had available debt facilities totaling $US748 million and cash of $US910 million.

Mr Botten said the company’s 2015 financial results will be released on February 23 2016, and that it is carrying out a comprehensive impairment review of its assets. The company said it expects a “material impairment charge to be recognised…with respect to the Taza PSC in Kurdistan (which presently has a book value of US$399.3 million), following disappointing appraisal drilling during 2015.”

Foolish takeaway

It’s common in the resources sector for miners to report write-downs or impairments on the carrying value of their assets when commodity prices take a turn for the worst. As we saw earlier this month, even the mighty BHP Billiton Limited (ASX: BHP) is not immune from reporting write-downs when prices slump.

And with no end in sight for low oil prices, it’d take a brave investor to wade into oil shares – even at these prices – in my opinion.

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Motley Fool writer/analyst Owen Raszkiewicz does not have a financial interest in any company mentioned. Owen welcomes -- and encourages -- your feedback on Google+, LinkedIn or you can follow him on Twitter @ASXinvest.

Unless otherwise noted, the author does not have a position in any stocks mentioned by the author in the comments below. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.