Monday, 24 November 2014

INTEROIL CEO Dr Michael Hession has reminded shareholders of the “natural advantages” held by the Elk-Antelope gas fields in Papua New Guinea.

Antelope-3 flare image courtesy of InterOil.

In a statement to investors published on the company’s website, Hession said Elk-Antelope would support at least a two-train project and benefit from several advantages over other gas developments in PNG.

Concept selection studies are well advanced and onshore and offshore surveys are due to start before the end of 2014.

"It is closer to infrastructure than any other developed gas field in the country and it is close to a major river, an important cost benefit when transporting people and equipment,” Hession said in a statement.

“It also has the natural advantage of being in a less-mountainous region than other major gas fields, a big factor in development cost.

“But more importantly, it is a single gas field that can be developed without the expense of pipelines and processing facilities to collect gas from multiple fields.

“Our opportunity – and the opportunity for Papua New Guinea – is to make the most of these metrics in developing Elk-Antelope efficiently and effectively.”

Hession said planning for the Elk-Antelope LNG Project continued to step up with more than 500 people now working on the project in Papua New Guinea, Australia, Singapore and France.

“The project promises to benefit from the pioneering PNG LNG project, which has shown the world that Papua New Guinea can build and operate mega-projects,” he added.

“In addition, Papua New Guinea is now recognised as having one of the lowest-cost greenfield LNG projects in the world, a huge advantage over other competing LNG projects in Australasia.

“We believe Elk-Antelope will support at least a two-train project and will benefit from several advantages over other gas developments in Papua New Guinea.”

The field has 9.07 trillion cubic feet of initial recoverable sales gas, according to GLJ Petroleum Consultant’s best-case estimate.

Meanwhile the PNG government told local media that it would renew Elk-Antelope’s PRL 15 licence next April.

Petroleum and Energy Minister Nixon Duban told journalists that the potential of the project’s gas fields would raise the country’s profile in terms of the LNG industry.

“It is something that the government wants to see immediately off the ground,” Duban said.

“Let me assure you … licence for PRL 15 will be renewed.

“We are appealing for the company now to apply for the development licence. We want to talk about landowner benefits, project agreements.

“Those must now become the pivotal part of the project. We’ve asked for the project to be brought forward.

“I am now advising the company to put in the petroleum development application.”

This is a new deal for the Gov't to be pushing for the Company to apply for a PDL. In the past I thought they were always trying to delay. This means the Gov't wants Total, IOC and OSH to reach FID earlier than they have been saying because we can not apply for a PDL until we have FID. I expect to see an expidited FID but don't know how fast they can push it. Hope they don't make the Gov't mad again.

'petrengr1' pid='52398' datel Wrote:

This is a new deal for the Gov't to be pushing for the Company to apply for a PDL. In the past I thought they were always trying to delay. This means the Gov't wants Total, IOC and OSH to reach FID earlier than they have been saying because we can not apply for a PDL until we have FID. I expect to see an expidited FID but don't know how fast they can push it. Hope they don't make the Gov't mad again.

I haven't researched  or refreshed myself on it, but I'm thinking it may be the other way around.  Do we not need the PDL, issued after

work on environmental issues, landowner information, etc., to proceed with FID?  I think IOC has already done a lot of work on this.

'Getitrt2' pid='52412' datel Wrote:

'petrengr1' pid='52398' datel Wrote:

This is a new deal for the Gov't to be pushing for the Company to apply for a PDL. In the past I thought they were always trying to delay. This means the Gov't wants Total, IOC and OSH to reach FID earlier than they have been saying because we can not apply for a PDL until we have FID. I expect to see an expidited FID but don't know how fast they can push it. Hope they don't make the Gov't mad again.

I haven't researched  or refreshed myself on it, but I'm thinking it may be the other way around.  Do we not need the PDL, issued after

work on environmental issues, landowner information, etc., to proceed with FID?  I think IOC has already done a lot of work on this.

Here is something IOC previously published:

"Petroleum Development License (“PDL&rdquo
In order to progress the proposed development and
commercialization of the Elk, Antelope and Triceratops fields, we will need to apply for and obtain a PDL from the State. Assuming that a PDL is issued, it will replace PRL 15 and include the Elk and Antelope fields and additional acreage required for in-field facilities and gathering systems. We will also need to apply for and be granted a Petroleum Processing Facilities License (“PPFL&rdquo for
the LNG Project and Pipeline Licenses (“PLs&rdquo for the dry gas and condensate pipelines. We have commenced preparation of an application for a PDL.
The application for a PDL is made to the DPE and must be
accompanied by detailed proposals for the financing, construction, establishment and operation of all facilities and services for and  incidental to the recovery, processing, storage and transportation of gas from the PDL area. Collectively these will constitute the Development Plan. In addition, certain agreements and approvals from the State will need to be in place prior to the grant of the PDL
including a gas agreement defining the fiscal regime applicable to the development and providing for the State’s equity participation in the fields. Environmental approvals will be necessary and we will also be obliged to submit comprehensive social mapping and landowner identifications studies of those customary landowners
within the PDL area. Ministerial recognition of landowner groups is customarily based on such reports.
Upon application, the State will undertake a comprehensive review of the Development Plan and any other incidental agreement or approval required before granting the PDL application. Following its review, the State shall take steps to conduct a ‘forum’ as set out under the Oil & Gas Act. The forum requires that the State co-ordinate a meeting for all affected stakeholders including the provincial, local level governments and customary landowners with a view towards establishing a regime for the distribution of royalties
and other benefits that will arise from the commercialization of thefields

Once all formalities are completed and the State is satisfied, the State may grant the PDL, the PPFL and the PLs. Should the licenses be issued, the acreage would be held subject to;
(i) periodic review provided for in PNG’s Oil & Gas Act, and (ii) the license holders continuing to meet commitments associated with the license grant."

The part I have highlighted kind of sounds like what you would have to have to reach FID. Also I think Phil had said FID would come before PDL.

'jft310' pid='52437' datel Wrote:One question is how much of the old work is transferable to the new project ..?. Social mapping, land ownership and environmental all have had work applied but is it sufficient ??

Add to the the CSP, the pipeline route to the coast, the preliminary harbor investigations, the limestone bluff location for the original modular plant.  Lots has been done.  Heck, even the first road to Kerema has been built in the past couple of years.