A little oversight.
First, what did they find?
The liquids from the wells so far
- Elk-1 102 MMcf/d and 5 Bbls/MMcf = 510 barrels per day
- Elk-4 105 MMcf/d and 18 Bbls/MMcf = 1890 b/d
- Antelope-1 382 MMcf/d and 13 Bbls/MMcf = 5000 b/d
- Total so far 7400 b/d
This could very well increase considerably:
- At Antelope1, the flow test used only 1/3 of the pipe
- Antelope2 lies deeper, which makes a higher liquid (or even oil) presence likely
It’s also important to keep in mind the following distinction:
- Gas condensates, these can be condensed out
- Gas liquids, these have to be removed by a stripping plant.
Since the gas is highly pressurized and at high temperature, condensates can be simply removed by depressurizing the gas and letting it cool off. The only problem is what to do with the gas, there are two options here:
- Flare (that is burn) it
- Reinjecting the gas back into the resource, at least, until the LNG facility is finished.
The first is not an option, it would be ridiculously wasteful, which leaves the second option, putting it back into the resource, which needs a couple of good compressors and a pipeline to an adjacent well. This is not rocket science, and could cost up to $20 million.
Another interesting point is that this is work that has to be done anyway, even when the LNG facility is operational, as the condensates need to be (largely) removed before it can be transported problem free into the pipeline to the LNG facility.
Wells that produce a lot of wet gas have these facilities to dry the gas adjacent anyway. It’s common practice. In this case, it provides early cash-flow.
Liquids like ethane, butane, propane, pentanes etc. will ultimately have to be removed, but this is not necessary at the wellhead. It will take place at the LNG facility site. Building a separate stripping plant now doesn’t make a lot of sense.
However, these liquids are very valuable by products in their own right, and will provide additional income sources and could function as input into a nascent petrochemical industry in PNG.