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05-21-2013, 02:25 AM
(This post was last modified: 05-21-2013, 02:28 AM by petrengr1.)
I do not believe Pertamina has any interest in being the upstream operator. They do not have any experience, know how and qualified personnel to do this type work.
In Indonesia the Government grants PSC’s (Production Sharing Contracts) to various oil companies, in the past primarily International Majors. The winner of the PSC’s do the exploration and/or development of the license areas. The production is split in accordance with the terms of the PSC.
I the case of Arun, Mobil (Now ExxonMobil) is the owner of the PSC license, originally acquired in 1968.
In the case of Bontang, gas was originally discovered by Huffco (Now Vico). Over the years gas has come from three different PSC’s. The Offshore Mahakam PSC (50% Total, 50% Inpex), Sanga Sanga PSC (23.13% Vico, 26.25% ENI (ex-Lasmo), 26.25% BP, 20% CPC Taiwan, 4.37% Universe Gas and Oil (Osaka Gas) and East Kalimantan PSC (100% Unocal). Unocal is now Chevron.
You can see here the ownership of the Upstream and Downstream Operations. I think the PSC contractors drilled and developed the gas fields including the installation of the infrastructure. A JV company was set up at both Arun (P.T. Arun NGL Co.) and Bontang (P.T. Badak NGL Co.) to operate the LNG plants or downstream operations with ownership as shown at the above site. Over the years these JV operating companies have been completely Indonesianized or Operated by Indonesian personnel. These two JV operating companies are “site specific” with ownership associated with that particular project. I doubt that these companies would be used to operate an LNG Plant in PNG.
I think Pertamina is trying to branch out into International areas to become minority owners of gas from various sources, including Elk/Antelope Fields, in order to have access to gas for domestic use. I doubt that they are interested in being either the Project Operator or the Plant Operator. Of course that is just my opinion.
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Well, based on the description you've provided, your opinion seems well founded, as usual. Still, the alternative, and more probable role for them to seek out a minority stake is a positive as well.
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As long as they bring a thick wallet that opens let them have 10 percent
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Last we know IOC's amended PA/Gas Agreement has a requirement that IOC deliver an 'international recognized LNG operator'. Last we know 3 SMs and JKM plus possibly another NOC is in the bid mix still.
JKM has been publicly accurately deemed as not having LNG operational experience.
TOT has been reported as a Gulf LNG bidder and they too have no LNG operational experience.
The conundrum for TOT and JKM both is they may need to partner with the 'international recognized LNG operator' as opposed to hiring that operator which is common practice as not all SMs involved with LNG have LNG operator capabilities. It is a stretch for PNG to assert that TOT or JKM with a contract operator would not be a suitable partner for IOC as it is a stretch to assert TOT or JAPEX (recall the recent MOU with PNG) of JKM would not be suitable upstream operators.
I haven't checked but it's a safe bet to state that Pertamina has more LNG operator experience than any other entity world wide as Pertamina was involved in the creation of the LNG business with Arun and Bontang. The entity operating Gulf LNG will be project specific and will not be an existing operating entity. Pertamina also has E-P division and operates 8 Indo refineries and owns 2 of them. Pertamina is the real deal in the energy world and they would appear more than adequate as project operators. They would make a great partner for PNG and IOC.
Good thing is IOC's bidder short-list is still at least 4 strong and likely is 6 bidder long.
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Well, I've wondered why Japex wouldn't qualify as an operator as they run the Yufutsu LNG plant (build by Nippon Steel)
JAPEX has constructed a natural gas liquefaction plant at the Yufutsu oil and gas field to supply natural gas to customers in Hokkaido in geographic areas outside the reach of its pipeline network. Shipments of LNG by road and rail to LDCs in Hokkaido began in October 2003 using a container system we call the LNG Satellite System. The Yufutsu LNG Plant is a groundbreaking project that has paved the way for the supply of LNG in Hokkaido. In addition, we completed the second train at the Yufutsu LNG plant in November 2007. Looking ahead, plans call for promoting the introduction of natural gas and expanding supply volumes with an emphasis on LDCs far from the Yufutsu oil and gas field.
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Imagine what an "LNG Satellite System" would do for the remote areas of PNG...CNG for vehicles, local (distributed) electric power, refrigeration. PNG has a lot of interests in the IOC projects. A dizzying decision matrix. I trust the board and O'Neil have the wisdom to see there is no "best" solution, only the need to choose from several very, very good ones.
Seems the shorts tried to drive the market down at 10 am today, only to succumb to buying support. Will the capitulate before the selldown announcement? I think that is starting to happen now, another postive gain on above average volume.
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So is it buy the dips, Art? Isn't that always the case (at least as long as the longer-term uptrend is intact)
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Heres my take on Pertamina.
First a Definition-Downstream (petroleum industry)
From Wikipedia, the free encyclopedia
For other uses, see Downstream (disambiguation).
The oil and gas industry is usually divided into three major sectors: upstream, midstream and downstream. The downstream sector commonly refers to the refining of petroleum crude oil and the***** processing and purifying of raw natural gas****,[1][2][3] as well as the marketing and distribution of products derived from crude oil and natural gas. The downstream sector touches consumers through products such as gasoline or petrol, kerosene, jet fuel, diesel oil, heating oil, fuel oils, lubricants, waxes, asphalt, natural gas, and liquified petroleum gas (LPG) as well as hundreds of petrochemicals.
Midstream operations are often included in the downstream category and considered to be a part of the downstream sector
Second from PET's links
Ownership Downstream (9) P.T. Badak NGL Co. at Bontang (*****55% Pertamina****, 20% Vico, 15% Japan
Indonesia LNG Co.); P.T. Arun NGL Co. at Aceh (****55% Pertamina*****, 30%
ExxonMobil and 15% Japan Indonesia LNG Co
Conclusion-The Pertamina owned entities performed the Downstream activites for Arun...Or they have over 20 years experience as an operator with over 15 mtpa plants.
No reason what they did for Indonesia at Arun they couldn't do for PNG at E/A!!!
And yes this is why JKM partnered with them for a Bid on some unknown size for E/A. Now will they win????
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["And yes this is why JKM partnered with them for a Bid on some unknown size for E/A."]
That's a remarkably robust statement there, JFT. Hope you're right!
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Connect the dots STP. JKM was told they needed a operator. And it appears they connected with one of the largest operators. Pertamina.Thats what the streets of PNG say .
Maybe you missed this :kommonsents
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RE: Pertima the NOC of Indonesia, Are they in??
Indonesian interest, says source Blair Price Friday, 17 May 2013 INDONESIAN LNG powerhouse Pertamina is rumoured to have made a bid for InterOil’s Elk-Antelope discoveries in Papua New Guinea.
An industry source said the leading LNG producer and exporter was bidding for a stake of the Elk-Antelope field.
Whether the bid is for an operating or smaller stake is not known. The source said the Indonesian state-owned company needed to import LNG to meet existing export commitments because its production was falling.
There is no other confirmation at this stage and PNGIndustryNews.net’s questions to Pertamina have gone unanswered for a week.
InterOil cannot legally reveal which parties have made bids, but previously signalled they had come from supermajors, and national oil and gas companies.
Pertamina raised $US3.25 billion through an Indonesian record bond issue this week and yesterday announced it signed a production sharing contract for a shale gas block in North Sumatra, with $7.8 billion to be invested over 30 years.
Various reports indicate that at least three supermajors have made bids for an operating stake of the Elk-Antelope field, which underpins InterOil’s Gulf LNG project that targets at least 3.8 million tonnes per annum but has scope for expansion.
http://www.pngindustrynews.net/storyview...nsource=s0
Thanks for posting Kommon
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