08-02-2013, 05:32 AM
From Seeking Alpha:
The PNG LNG project construction is currently 88% complete and is achieving project milestones towards a 2014 startup.
Commissioning activities for the first train at the LNG plant are ongoing while construction activities for the second train continue. Progress also continues at the Hides gas conditioning plant for equipment including gas turbine generators and utility systems that’s being received and installed. We are also advancing expansion opportunities, including negotiations with NOL Corporation and Pacific LNG on the future development of the Elk, Antelope resource. Major terms have already been agreed and should negotiations successfully conclude Exxon Mobil is proposing that 4.6 TCF of the gas resource from the Elk Antelope field be used to underpin the construction of an additional train at the PNG LNG project site, subject to partner and government agreement.
Evan Cleo - Morgan Stanley- My first question on P&G. I mean it’s clearly a differentiated position for Exxon I know you discussed your negotiations required additional supply and you picked up some exploration acreage in the quarter. But could you discuss how additional expansion trend compared within your portfolio versus other projects that I know you overviewed globally. And additionally with one and two were I think in their five years from FID to expected first gas I would presume expansion trains could be much faster than that. And then based upon the availability of gas the Exxon vision replicating style development here of per type of a concept. I have a follow up.
David Rosenthal
Yeah, let me kind of start at the back of your question first. Clearly as we’d be true of your project once you’ve got all the facilities in play the pipelines the capacity the trends the utilities all the common facilities any addition is typically going to be quicker and have quite attractive incremental economics. So I wouldn’t want give a specific time frame on an additional trend beginning other than they say we have plenty of land space there, we have plenty of infrastructure. So we certainly have the ability to as rapidly as possible expand that facility over the course of the next few years and we do have a number of opportunities we mentioned the – oil discussions are going on we have had some success in exploration recently and – south and we have got some other exploration opportunities in the area. So we are optimistic on that.
In terms of relative economics of Papua New Guinea versus other project I wouldn’t to give any specific comparisons or numbers other than to say we do view that project quite attractive for us and we certainly look forward to bringing forward some expansion opportunities and continuing to improve further on those economics.
And we’ve got to Pablo with Raymond James.
Unidentified Analyst
Thanks for taking my question. First just a quick one on P&G, LNG any sense of when you’re looking to make a decision price extension on trend free?
David Rosenthal
No, I really don’t have an outlook on that. We’re still in the commercial discussion on the potential for extension. So until those concluded it would be difficult to give any forward guidance on timing after that. Other than we’re working on it if those negotiations are successfully concluded we’ll be in the better position to talk about the going forward timeframe.
The PNG LNG project construction is currently 88% complete and is achieving project milestones towards a 2014 startup.
Commissioning activities for the first train at the LNG plant are ongoing while construction activities for the second train continue. Progress also continues at the Hides gas conditioning plant for equipment including gas turbine generators and utility systems that’s being received and installed. We are also advancing expansion opportunities, including negotiations with NOL Corporation and Pacific LNG on the future development of the Elk, Antelope resource. Major terms have already been agreed and should negotiations successfully conclude Exxon Mobil is proposing that 4.6 TCF of the gas resource from the Elk Antelope field be used to underpin the construction of an additional train at the PNG LNG project site, subject to partner and government agreement.
Evan Cleo - Morgan Stanley- My first question on P&G. I mean it’s clearly a differentiated position for Exxon I know you discussed your negotiations required additional supply and you picked up some exploration acreage in the quarter. But could you discuss how additional expansion trend compared within your portfolio versus other projects that I know you overviewed globally. And additionally with one and two were I think in their five years from FID to expected first gas I would presume expansion trains could be much faster than that. And then based upon the availability of gas the Exxon vision replicating style development here of per type of a concept. I have a follow up.
David Rosenthal
Yeah, let me kind of start at the back of your question first. Clearly as we’d be true of your project once you’ve got all the facilities in play the pipelines the capacity the trends the utilities all the common facilities any addition is typically going to be quicker and have quite attractive incremental economics. So I wouldn’t want give a specific time frame on an additional trend beginning other than they say we have plenty of land space there, we have plenty of infrastructure. So we certainly have the ability to as rapidly as possible expand that facility over the course of the next few years and we do have a number of opportunities we mentioned the – oil discussions are going on we have had some success in exploration recently and – south and we have got some other exploration opportunities in the area. So we are optimistic on that.
In terms of relative economics of Papua New Guinea versus other project I wouldn’t to give any specific comparisons or numbers other than to say we do view that project quite attractive for us and we certainly look forward to bringing forward some expansion opportunities and continuing to improve further on those economics.
And we’ve got to Pablo with Raymond James.
Unidentified Analyst
Thanks for taking my question. First just a quick one on P&G, LNG any sense of when you’re looking to make a decision price extension on trend free?
David Rosenthal
No, I really don’t have an outlook on that. We’re still in the commercial discussion on the potential for extension. So until those concluded it would be difficult to give any forward guidance on timing after that. Other than we’re working on it if those negotiations are successfully concluded we’ll be in the better position to talk about the going forward timeframe.