http://www.oilsearch.com/Media/docs/1H%2...fa4e-0.pdf
Oil Search achieved a strong operational and financial start to 2015, reporting record half year production and net profit despite significantly lower global oil and LNG prices. The successful delivery and exceptional performance of the PNG LNG Project since its start-up in early 2014 has been a vanguard for PNG, marking the country and the Project as a reliable supplier of high quality and low cost gas. Production optimisation and potential debottlenecking provide opportunities to deliver further value. Progress was also made on the next phase of LNG development in PNG. PNG LNG Project expansion and the Papua LNG Project are amongst the most competitive LNG projects globally, even in a lower oil price environment. However, we are not being complacent. While we live in hope of a recovery in oil price, it is impossible to predict how long lower prices will prevail. Therefore we believe it is prudent to plan for an extended period of oil prices at or around current levels.
Progress on LNG expansion opportunities in PNG
In January 2015, a Memorandum of Understanding was signed between ExxonMobil PNG Limited and the PNG Government for the development of the P’nyang gas field. This would underpin PNG LNG Project expansion, including a potential third LNG train, and domestic power in PNG. The joint venture expects to drill an appraisal well in the first half of 2016 to further constrain the resource in the field. A Petroleum Development Licence (PDL) application for P’nyang is currently under review by the Government. Once the PDL has been awarded, the intention is to integrate P’nyang into the PNG LNG Project. Significant progress was also made on the Papua LNG Project, underpinned by the Elk-Antelope gas fields in the Gulf Province of PNG. Initial appraisal results from the drilling campaign on the Antelope field have been encouraging and Oil Search is confident that the field has sufficient resources to underpin at least one large LNG train or possibly two PNG LNG-sized trains. In June, the PRL 15 Joint Venture led by Total SA, reached an agreement, with endorsement from the PNG Government, on site locations for the proposed development. Further appraisal drilling is expected to continue over the rest of 2015. Oil Search anticipates that selection of a final development concept, resource certification and entry into Front End Engineering and Design will take place during 2016.
, imo.