Over the past week, the S&P ASX 50 Index (ASX: XFL) closed down 2.4%. Only three of the 50 companies made gains for the week, and bringing up the bottom as the biggest loser of the week in the ASX 50 was Qantas (ASX: QAN).
Biggest gainers
Santos (ASX: STO) was up 4% for the week, closing at $14.55. It flagged in its investor briefing higher production for FY2014, expected to be 52-57 millions of barrels equivalent, driven by the PNG LNG start up. Production for 2013 is now expected to be 51 mmboe. It also projected the start of the GLNG project is on track for first LNG in 2015, stating the project is now 72% complete.
Oil Search (ASX: OSH) was also up 4%, ending at $8.28. French oil major Total announced last week that it was intending to buy into the Elk/Antelope gas field currently held by InterOil in PNG. OilSearch said it was in discussions over the purchase of equity in the licence area covering the Elk and Antelope fields itself.
There is some speculation that the two companies could possibly swap equity in this gas field for another called Taza in Kurdistan, in which Total has about a 20% stake and OilSearch has 60%.
Rio Tinto (ASX: RIO) closed at $66.41 on Friday, up 1% for the week. At its investor seminar, it reaffirmed more cost management by stating that forecast 2013 total capital expenditure will be less than $14 billion, making it 20% lower than that of 2012.
It has plans for increasing iron ore production through a low capital expenditure pathway to grow its annual production to at least 330 million tonnes in 2015, up from 290 million tonnes. Projected cost savings are around US$3 billion.
Biggest loser
Qantas (ASX: QAN) fell by 16% over the past week, closing Friday at $1.03.
The airline company announced that it would be cutting 1,000 jobs, and warned it may have a $300 million loss in the first half of next year. Its credit rating was cut to lower than investment grade, now at junk status, which prompted the heavy selling downwards.
It complained that the $350 million cash injection that Virgin Australia Holdings (ASX: VAH) is to receive from its major shareholders, international airlines companies themselves, will allow it to unfairly undercut Qantas in an attempt to weaken the domestic air travel leader and take over its routes.
Foolish takeaway
This year may have seen the weakening of the mining industry slow things down, but the market still has the oil and gas development expansion to look forward for the next couple of years to balance that out.
Qantas may not have too much maneuvering room, and being downgraded to junk status means that some institutional investors may not be able to purchase its shares due to restrictions on buying equities of less than investment grade rating.
