Total SA set to prosper from Papua New Guinea gas changes
Oil Search says its stalled plan to expand gas output in Papua New Guinea will now focus on the Papua LNG project led by Total SA, in a change of direction following political ructions in the Oceania country.
France’s Total had previously pushed to work with Exxon to double LNG exports from the country via a twinned £9.8 billion expansion of Exxon’s PNG LNG plant, and development of Total’s Papua LNG project.
As a partner on both projects, Oil Search insists that they will only go ahead together by adding three new processing units, or trains, at the PNG LNG site.
The company operates all of Papua New Guinea’s producing oil fields, and holds a 29 percent stake in the producing PNG LNG project, while it is also pursuing major LNG growth opportunities in partnership with ExxonMobil and Total.
However, progress on the projects has been stalled by Prime Minister James Marape’s push for a bigger take for the country from Exxon’s side of the project – the development of the P’nyang gas field. Oil Search says it now sees Total’s Papua LNG progressing on its own, with two trains initially.
“There is significant interest from all parties to simplify LNG expansion in PNG and focus on Papua LNG 2 trains,” Oil Search CEO Keiran Wulff tells investors.
His comments come as Marape faces a threat to his leadership, with several members of his government switching to the opposition on November 20.
“Whilst PNG is certainly the land of the unexpected, recent events are worth following closely,” Wulff says. “Comments by Total, the PNG government and the PNG opposition are increasingly supportive of advancing the Papua LNG project.”
However, he points out that Papua LNG will need to test market demand before going ahead.
“We think there’s a strong increase in demand opening up in 2027” as big coal users such as Japan and South Korea seek to lower emissions, Wulff tells Reuters.
In order to meet that window, Papua LNG’s owners will need to reach a final investment decision in 2030, he adds.
Declining to comment on Oil Search’s remarks, Exxon says that talks with the Papua New Guinea government about the P’nyang gas project, which was to feed a third new train at PNG LNG, are ongoing.
In emailed comments, the company says that it is ‘hopeful that we can work towards an outcome that benefits all stakeholders’.
Wulff adds that Exxon’s PNG LNG plant has been producing at 26% above its nameplate capacity. As a result, it will soon need new sources of gas, which means that P’nyang might be tapped to supply the existing PNG LNG trains instead of a third unit.
Global Offshore rebrands Enelift and invests in global hubs
Global Offshore has rebranded Enelift and will invest "a seven-figure sum" in establishing new support hubs in Houston, Dubai, Singapore, Perth and the Caspian during the next six months.
The investment will cover oil, gas and renewables, mainly concentrating on manufacturing capability with associated R&D, as well as in stock held in the hubs.
The company’s flagship Hinge Lok technology provides aluminium, non-welded light weight transportation cradle for casing and tubing. Enelift now plans to enhance its offering by augmenting its existing solutions with robotics and remote operational and training technology, which will reduce manpower for handling offshore equipment that is transported and stored using the Hinge Lok system.
Enelift is partnering with "a Japanese robotics company" and the technology will be trialed with "a Norwegian operator on a Norwegian drilling rig", according to a statement.
Operating from its bases in Aberdeen, UK and Esbjerg, Enelift was founded by 35-year industry veteran and Managing Director Paul Brebner 10 years ago to offer the offshore energy industries safe, reliable and efficient storage and transportation of equipment.
The expansion plans are bolstered by the appointment of Jim Clark of the Craigendarroch Group to Chairman, and Adam Maitland to Non-Executive Director. Maitland is the Managing Director of Hutcheon Mearns IF, and brings his wealth of expertise in the field of corporate finance.
Brebner said Enelift may be a new name in the market, but the experience it brings is "industry renowned".
"Our solutions are underpinned by safety that enables inefficiencies and their associated costs to be eradicated – meaning operational personnel can focus doing what they do best, safely. We remain committed to providing the safest storage and transportation solutions for equipment in the sector as we grow our global operations," he said.
Clark said the market is changing and its solutions fully support customers’ economic and safety aspirations.
"We are very well placed to take full advantage of increasing opportunities in the Middle East, Africa, Far East and Americas. Safety is our absolute commitment to our customers and our support hubs will facilitate this. Aligning our identity to our entire offering ensures that we will drive our expansion through new products and global support sites across the rest of this year."