PNG gets first offshore project


THE Twinza Oil Ltd will be the first company to conduct offshore petroleum development in Papua New Guinea. Business Editor SHIRLEY MAULUDU discusses with Twinza managing director HUW EVANS the Pasca A field in Gulf which the company will be developing.

MAULUDU: Tell us about Twinza Oil Limited
EVANS: We founded the company in 2006 with the backing of the Clough Family from Perth.
The Clough family founded Clough Engineering and have been active in Papua New Guinea infrastructure development since the Kutubu development.
While the Clough family have since sold their interest in Clough Engineering, they have of course a great depth of experience in working in PNG and have remained strong supporters of investment in the country.
We were pleased to introduce Kerogen Capital, a specialist oil and gas private equity fund manager, as a shareholder in Twinza in March 2014.
Kerogen manages more than US$2 billion (K6 billion) which is invested in global upstream oil and gas development.
It has brought a wealth of in-house industry and financial expertise as well as operating and technical experience.
I came to PNG in 1984 and worked on the first commercial oil discovery at Iagifu-2X in 1985 before spending five years in the highlands on helicopter-supported geological fieldwork for Gulf /Chevron.
Since our establishment we have been active as an Operator in Myanmar, Thailand, Australia and of course PNG.
During this time we have conducted offshore and onshore drilling and seismic operations and are applying this experience to PNG.
We have very capable teams in Port Moresby and Singapore who have a wealth of planning, implementation and operating experience.
Our PNG development team is experienced in the development of offshore oil and gas fields and we have the additional advantage of having access to the deep pool of construction, marine and logistical expertise in Singapore.
All this experience and expertise is being directly focused on the development of Pasca A.

MAULUDU: Tell us about the Pasca A field.
EVANS: The Pasca A rich gas-condensate field is located about 90 km offshore in the Gulf of Papua in 93 metres of water depth.
The field was first discovered in 1968 by a consortium of five companies (Philips, Arco, Sunray, Canadian Superior and Australian Superior).
The field name comprises the first letter of each company name.
Three historical wells were drilled in Pasca A in 1968, 1969 and the most recent one being in 1983.
However, no commercial development solution could be found at that time. Size-wise, Pasca A is modest in comparison to some of the onshore fields that have recently been developed but it has a substantial volume of LPG that can easily be supplied into the PNG domestic market.
Twinza identified the potential of Pasca A in 2008 and were awarded PPL 328 over the field in 2011.
Since then a complete re-evaluation of the field has been undertaken through the application of modern data and methods, including 3D seismic technology through to digital core analysis.
Most of the techniques applied did not exist when the field was first discovered, and through their use Twinza has been able to propose a commercial development solution to the government.
We are excited about the road ahead for the Pasca A field and with the support from the PNG government we look forward to developing PNG’s first offshore production infrastructure.

MAULUDU: How will the company extract the gas resource at the Pasca A field?
EVANS: The Pasca A wet gas condensate field development requires wells to be drilled into a reefal limestone reservoir.
Offshore processing facilities will be installed at the field location. We are currently drilling the Pasca A4 well which the fourth and final appraisal well and the first since the last drilling campaign 34 years ago.
This well will be completed for use in the development.
The facilities design comprises two offshore platforms and two floating storage and off-take vessels or FSOs. The smaller wellhead platform will support the wells, from which production flows across to the adjacent processing platform.
The larger processing facility will contain gas processing units to extract LPG and condensate products which will be stored in the FSOs for export.
The dry gas stream will be reinjected into the reservoir for future extraction in a second phase of development.
The offshore facilities will be pre-fabricated and brought to PNG for installation in the Gulf of Papua.
The main processing platform will be self-installing, using a similar design to the jack-up drilling rig that was recently brought into PNG and unloaded just near Port Moresby.
We expect the offshore facilities will take two years to design and fabricate, hence Twinza could be producing LPG and condensate from Pasca A in 2020.

MAULUDU: Given the nature of the project, would there be any implication on the environment when Twinza starts on the development of the project?
EVANS: There are always environmental concerns for any new development and our project is no different.
It is important to note that offshore projects and operations in the upstream oil and gas industry are very well established globally since the 1950s.
There is already a large body of knowledge to draw from for a project like ours.
We will be installing the first offshore production facility in PNG, nevertheless the technology and operational approach we are adopting are proven and well established in the industry.
Since 2015, we conducted environmental baseline surveys and site-specific sampling and tests, as part of our Environment Impact Statement (EIS) for the project.
The EIS was a collaborative approach in accordance with the Environment Act (2000) and involves working closely with the Conservation and Environment Protection Authority and other key institutional stakeholders such as National Fisheries Authority (NFA), National Maritime Safety Authority (NMSA), PNG Ports Corporation, the Gulf Provincial Government.
They all have made valuable contributions to the Pasca A EIS which I am pleased to say was produced to the World Bank standard.
Through endorsement of the Environment Council, the Pasca A Project’s Environment Permit was granted to Twinza in April this year.
Our operations from here on adheres to prescribed conditions of our Environment Permit.
As part of the EIS process we conducted hazards assessments to identify potential accidental events.
These hazard assessments are being progressively refined with mitigation measures built into the project’s design to reduce risk of these events.
Our project’s location at 90 km from the nearest landfall is distant from any sensitive marine fauna and flora or resource use and conservation value.
The great distances from sensitive nearshore marine resources provide extensive time for effective implementation if we must respond to a condensate spill from our facility.
We have an Environment Management Plan that guides our operations and adheres to conditions of our environment permit.
Through our site selection, modern drilling techniques, and design of our wells and production facilities, we managed to avoid many potential impacts to the environment.
For example, our use of a self-installing processing platform design allows for us to leave behind minimal environmental footprint at the end of the field life as the platform can simply be jacked down and towed away from the location.

MAULUDU: There have been recent comments on laws governing the sector to be reviewed to suit offshore projects like Pasca A which Twinza is working on. What is the company’s comments on that?
EVANS: PNG has historically seen mostly terrestrial projects in the upstream oil and gas sector and there are ongoing discussions amongst stakeholders on the application of regulations and standards for off-shore projects.
PNG already has key legislations in place such as the Oil and Gas Act (1998), the Oil and Gas Regulations (2002), and the Environment Act (2000).
These are the principal legislations for all upstream oil and gas exploration and production activities in the country.
Twinza takes compliance with established laws and regulations seriously.
We recognise that there will be some unprecedented challenges for our project located far from shore as we set out to install the first off-shore hydrocarbon production and export facility in the Gulf of Papua.
Twinza has taken all prescribed steps under the Oil and Gas Act.
This includes undertaking a Social Mapping and Landowner Identification (SMLI) study by an independent third party who engaged with all key stakeholders in twhe SMLI process.
All key stakeholders recognize that our project location 90 km from shore is within the National Government’s 200 nm exclusive economic zone with the 3 nm – 12 nm being the territorial water belonging to the Provincial Government.
There are technical and operational considerations which will require contributions from relevant regulators such as CEPA, DPE, NFA and NMSA.
They have all been engaged on the project, especially with the process leading to our Environment Permit award.
The future of the project will require constant dialogue to ensure we are kept abreast of any regulatory changes or updates these key agencies institute.

Leave a Reply