XOM or TOT?

[IOCHUHU]

IMHO lots of effort has been wasted here and elsewhere trying to determine how the E/A gas will get processed. I believe that IOC will soon close the deal with Total and we will still not know. The appraisal wells and certification will determine the route the PRL 15 JV chooses. If there is only 4.0 TCF then it doesn't make sense to build your own LNG plant. If there is 9+ TCF (and maybe some of the exploration wells are successful) then it will probably be advantageous to build your own LNG facility (probably not in the Gulf btw).

[Putncalls]

After all these years would there be less than 9TCF in the estemate for E/A?

[IOCHUHU]

I certainly think there is but majors need more clarification. They aren't going to commit to a particular plan until (re)-certification. These are process driven organizations not The Hoffmans (Gold Rush). So if there is more than 9TCF (and maybe exploration wells yield more TCFs then the TOT/IOC/OSH/PNG JV probably chooses to build their own LNG facility. Otherwise, the JV always dances to XOM's tune.  Sure their is duplication but the PNG Government will happily have the extra jobs and guaranteed revenues in case of a disaster at PNG LNG or the fields that supply it. Having 2 plants also encourages drilling by 3rd parties as they could count on competitive bidding for any gas they find, which would encourage more E&P investment.

However, while nearly ever IOC investor probably believes E/A will certify from 6-9 TCF, I don't think TOT will commit to how the gas will be processed until the information about the certification wells is analyzed.

Doesn't this just make sense to you guys?

[Kaliboo]

I certainly think there is but majors need more clarification. They aren't going to commit to a particular plan until (re)-certification. These are process driven organizations not The Hoffmans (Gold Rush). So if there is more than 9TCF (and maybe exploration wells yield more TCFs then the TOT/IOC/OSH/PNG JV probably chooses to build their own LNG facility. Otherwise, the JV always dances to XOM's tune.  Sure their is duplication but the PNG Government will happily have the extra jobs and guaranteed revenues in case of a disaster at PNG LNG or the fields that supply it. Having 2 plants also encourages drilling by 3rd parties as they could count on competitive bidding for any gas they find, which would encourage more E&P investment.

However, while nearly ever IOC investor probably believes E/A will certify from 6-9 TCF, I don't think TOT will commit to how the gas will be processed until the information about the certification wells is analyzed.

Doesn't this just make sense to you guys?

I was wondering how susceptible PNG is to tsunamis.  If so, the PNG LNG plant looks quite vulnerable.  Seems like they should have chosen higher ground a little further from the coast.