PNG LNG production continues to break records

The ExxonMobil-operated PNG LNG plant reached its highest average annualized production rate since production commenced, of approximately 8.3 mtpa, during the fourth quarter 2016.

This is 20 percent above the nameplate capacity of 6.9 mtpa, Oil Search, the owner of a 29 percent stake in the project, said in its quarterly report, adding that 28 LNG cargoes were sold during the period, 24 under long-term contract and four on the spot market, with two cargoes on the water at year end.

For the 2016 full year, 108 LNG cargoes were sold, comprising 89 under long-term contract and 19 on the spot market, with two cargoes on the water at the end of the year.

Total production in the fourth quarter of 2016 was 7.72 million barrels of oil equivalent (mmboe), taking the 2016 full year production to 30.24 mmboe, 3 percent higher than production in 2015 and marginally above the top of the 2016 guidance range, as well as being an all-time record for the company.

Total revenue for the quarter was US$345.6 million, 12 percent above the third quarter, due to higher liftings combined with the increase in global oil and gas prices.

The average realized LNG and gas price was $7.09/mmBtu, up 10 percent from the third quarter, while the average realized oil and condensate price increased 5 percent to $49.68/barrel.

During the quarter, Oil Search continued discussions with key stakeholders, including ExxonMobil, Total and the PNG Government, on how to deliver coordinated LNG expansion synergies within PNG.

The company expects formal talks to take place in early 2017, contingent on the successful completion of ExxonMobil’s revised offer to purchase InterOil Corporation and its entry into the PRL 15 joint venture.

Netherland Sewell and Associates (NSAI) is close to finalizing its review of the Hides,  Angore, Juha and Associated Gas fields. Preliminary indications are that NSAI’s estimate of technically recoverable raw gas resources within these fields will increase significantly from its 2009 PNG LNG project resource certification.

Work is underway to assess the impact this would have on Oil Search’s share of PNG LNG project reserves, which, together with a revision to the company’s estimate of resources in the Elk-Antelope fields post drilling, will be reported in the Reserves and Resources statement, due to be released in February 2017.

LNG World News Staff