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Gas production as of December 2019
phase 5 (2024) of the phased PNG LNG development. Currently these two gas fields are not producing. 8.0 PLANNED GAS PROJECTS A number of gas projects are in their development stages. These include the Papua LNG Project (PRL15) operated by Total Energies, P’nyang LNG project (PRL3) operated by ExxonMobil, Pasca Gas Project (PPL328) operated by Twinza Oil, and Elevala Ketu (PRL21) and Stanley (PDL 10) gas projects operated by Arran Energy. The future of the petroleum industry looks very promising with the government of PNG signing the US$13 billion Papua LNG Gas Agreement in April 2019 to develop the Elk and Antelope gas fields in the Gulf Province of PNG. The government also signed the US$11 billion P’nyang LNG Gas Agreement in February 2022 to develop the P’nyang gas field in Western Province. The signing of the two gas agreements defines the fiscal framework and paves the way for the commercial development of two mega projects in the country after the successful delivery of the PNG LNG project. The development of the two mega projects will certainly put PNG on the world map as a major regional LNG player, boosting PNG’s GDP, creating more job opportunities, increasing government revenue and injecting more foreign currency into the local economy in the years to come, while further elevating the country as a friendly foreign investment destination, attracting more interest in the industry. If the Pasca A, Stanley and Elevala Ketu gas-condensate projects are all developed as anticipated, it may even elevate PNG among the top LNG players in the world. The current high gas prices and surging demand for gas globally caused by the Russia-Ukraine war and geopolitical competition between great powers places PNG in an advantagous position to capitalise on the current situation to secure project financing as well as markets for the eventual development of these planned gas projects. 8.1. Papua LNG Project The US$13 billion Papua LNG Project is the next major LNG project after the US$19 billion PNG LNG project. The project, expected to export LNG at the end of 2027 if on schedule, will double PNG’s LNG export capacity and will further boost development. The Papua LNG project is operated by Total E&P as the operator. The project will see the development of the Elk and Antelope gas fields in PRL 15 in the Gulf Province, approx. 350km northwest of Port Moresby as shown (left). The Elk and Antelope gas fields were first discovered in 2006 by InterOil. Further appraisal work proved the Elk and Antelope fields to have a combined contingent resource estimate of 6.2 trillion cubic feet (tcf) of gas and 98 million barrels (mmbls) of condensate. The project consists of an upstream development of the Elk and Antelope gas fields and downstream development of LNG production at the existing foundation PNG LNG plant site at Caution Bay near Port Moresby. In general, the proposed upstream development concept comprises production wells, gathering systems and the proposed central processing facility (CPF) within PRL 15 (APDL). The CPF will consist of slug handling, separation, gas conditioning and compression equipment to supply dry gas and condensate to the existing PNG LNG plant at Caution Bay. The dry gas and condensate will be transported in two separate pipelines of different diameters along the same right of way to the existing foundation PNG LNG Plant site (PPFL2) near Port Moresby to be processed into LNG and exported through the existing LNG export facilities. The downstream facilities will include two LNG trains each of 2.7MTA capacity. However, the Papua LNG project will share common facilities with the PNG LNG project downstream, such as LNG export facilities and utilities. The gas agreement for the Papua LNG project was signed on 9 April 2019 followed by the fiscal stability agreement (FSA) and certain regulatory amendments to ensure its development. The gas agreement provides the fiscal, regulatory and licensing framework for the development of the project. In the Papua LNG project, the state has managed to negotiate and secure a total stake of 52%. This includes: royalty 2%, development levy 2%, production levy 2%, additional profit tax 15%, corporate tax 30%, and fiscal stability premium 2%, bringing the total stake to 52%. A petroleum development application (APDL) is anticipated to be launched
7.2. Agogo: Discovered in 1989 and production started in 1991. Cumulative oil production (Dec 2019) is 48,836 MSTB (83%) with a remaining recoverable reserve of 10,289 MSTB (17%). The associated gas cap will be developed as part of the PNG LNG project. 7.3. Moran: Discovered in 1996 and production started in 1998. The cumulative oil production (Dec 2019) is 93,035 MSTB (82%). The remaining recoverable reserve is 20,329 MSTB (18%). The associated gas cap will be developed as part of the PNG LNG project. 7.4. Gobe Main: Discovered in 1993 and production started in 1998. Cumulative oil production (Dec 2019)is 30,476 MSTB (99%). The field is almost depleted with a remaining recoverable reserve of 217 MSTB (1%). The associated gas cap will be produced as part of the PNG LNG project. 7.5. South East Gobe: Discovered in 1991 and production started in 1998. Cumulative oil production (Dec 2019) is 45,361 MSTB (99%). The field is almost depleted with a remaining recoverable reserve of 231 MSTB (1%). The associated gas cap will be produced as part of the PNG LNG project. 7.6. Hides: Discovered in 1987 with a total recoverable 2C reserves of 5.4TCF. Hides is the major gas field underpinning the foundation PNG LNG project, which exported its first LNG cargo in 2014. Total cumulative gas (formation gas including the condensate) produced as of Dec 2019 was 1,957,276 MMSCF10, which is estimated to be around 28% of the recoverable 2C Hides gas reserves and 25% of OGIP11. Estimated end of field life based on estimated ultimate recovery (EUR) is 2034. 7.7. Juha and Angore: Angore gas field in PDL 8 and Juha gas field in PDL 9 are part of the greater PNG LNG phased development. Angore was supposed to be developed as part of the phase 2 development but was delayed due to technical (well integrity issues) and certain landowner issues. The Juha gas field will be developed in Source : 2019 Engineering Branch Reserves Report, DOP
Papua LNG project development
Source : Total E&P
VOLUME 34 2023
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