Oil Search exec discusses impact of LNG projects

 THE integration of the PNG LNG project and the Papua LNG project is essential to maximise their value under the current environment of low oil and gas prices, Oil Search managing director Peter Botten says.

Commenting on the company’s March quarter performance, he said activities continued during the quarter on the potential expansion of the PNG LNG project, and on the proposed Papua LNG project development.

He said the company believed that cooperation in the development of those projects would bring value and avoid duplication of high-cost infrastructure in the country.

“Based on our studies, there are a wide range of development activities which, if pursued in a coordinated and cooperative manner, could generate material value, with benefits not just from lower costs but also from on-going operational synergies and potential schedule acceleration,” Botten said.

“The PNG Government, which will have equity in both PNG LNG expansion and Papua LNG, would also benefit significantly from generating maximum shared value during this next phase of LNG development in PNG.”

Total SA chairman and chief executive officer Patrick Pouyanné told The National last week: “We are selecting Caution Bay because potentially we would like to see if we could have some synergies between the Papua project and the PNG (LNG) project. This is the idea.”

Meanwhile, Botten said Oil Search believed there was already sufficient resource across both 

projects to deliver two 4 LNG 

trains, with the option of a third expansion train, subject to additional resource.

He said the intention was to integrate P’nyang into the PNG LNG project to support the potential expansion of the PNG LNG project.

Botten said the development of the Papua LNG project remained a priority for the PRL 15 joint venture and the PNG Government.