Firm signs deal to increase LNG contracted volumes
OIL Search Ltd signed mid-term liquefied natural gas contracts recently to take the total contracted volumes for PNG LNG up to 7.9 million tonnes, says managing director Peter Botten.
“They consider the move as a smart thing to do in the current market and this will leave only minor volumes exposed to LNG spots,” he said.
“The 7.9 million tonnes represents approximately 90 per cent of the project’s LNG production output.
“In April, the PNG LNG Project contracted the final mid-term tranche of LNG volumes with Unipec Singapore Pte Ltd.
“The contract ensures a commitment to supply approximately 0.45 million tonnes per annum of LNG over a four-year period.
“Supply commenced in April this year, with two LNG cargoes delivered to Unipec during the second quarter.
“The PNG LNG gas agreements were signed in April and other key commercial agreements may progress right through the first half of the year.
“PNG LNG undertook some significant schedule maintenance in the first half of the year and we anticipate a strong second half from the project.
“We also had a successful appraisal up at Muruk two which tested very good reservoir quality sands that proves that Muruk two is in continuity with Muruk one.
“That will have ramifications on re-source based announcements later this year and early next year.
“The Papua LNG has also dominated our discussions and interest over the last three or four months.
“We are effectively all ready to align our joint ventures, align the interest of the various commercial entities.
‘We are all ready to go when the Papua LNG and P’nyang gas agreements are confirmed and finalised by the PNG Government.”