Outline plans for a floating LNG project in SE Asia have been accepted by Perth-based Cott Oil and Gas to help it tap into reserves in the remote Pandora gas field offshore Papua New Guinea.
Cott has indicated investment costs of between $1.23 billion and $1.69 billion would be necessary for facilities needed to exploit Pandora, based on using either an FLNG vessel equipped to produce 1 MMtpa of LNG, or with a near-shore LNG vessel capable of producing up to 2.5 MMtpa, hooked up to a buoyant tower processing platform—with dry wellheads—and an export pipeline.
Pandora was discovered in 1988 about 200 km offshore in the Bay of Papua, west of Port Moresby. Although not deepwater (water depth is approximately 120m), the field in the PRL 38 license area is thought to contain 2C contingent resources of 800 Bcf.
Cott, which has 40 per cent equity in Pandora, already has non-binding agreements with potential LNG participants which could help develop the field. The others partners are Talisman Energy, which has 25 per cent equity and is the operator of PRL 38. Kina Petroleum Ltd. holds 25 per cent in the license and Santos has 10 per cent.
Recently Cott received a final FLNG conceptual development study for Pandora from contractor Wison Offshore and Marine, which Cott says offers two technically and commercially feasible concepts.
One is a 1 MMtpa FLNG vessel using an external turret mooring system, with capacity for gas liquefaction and storage, connected to three subsea completed production wells.
Wison’s concept study offers a second proposal to use a near-shore LNG vessel, with up to 2.5 MMtpa of liquefaction capacity, which could offer lower cost gas liquefaction through reduced mooring and offloading costs. This would require a buoyant tower to provide gas processing, but would offer the benefit of dry well completions and therefore the option for lower-cost well workovers and maintenance. “However, additional costs would be incurred in offshore production facilities and pipeline,” Cott notes in a statement on the Wison study.
Furthermore, the company points out a that a US subsidiary of Wison has already developed a buoyant tower design, which is already in use at the CX-15 development offshore Peru, and which is suitable for water depths between 50m and 250m and could accommodate Pandora production facilities.
Referring to the timing for a Pandora development, Cott says: “Wison indicates that first gas could be delivered within 34 months of award of an EPCIC contract. Of this, detailed engineering would take eight months with keel laying commencing 15 months after contract award. The vessel could be delivered within 16 months of keel laying and operational approximately four months after that.”
Cott is now aiming to start talks with the other license participants and with Papua New Guinea’s Department of Petroleum and Energy to try and progress the project. It will also hold talks with contractors who have experience and a track record in the LNG sector, who have build-own and operate expertise for LNG facilities.
Cott wants to make an announcement in the near term regarding potential non-binding agreements with potential contractors.
Mark Thomas can be reached at mthomas@hartenergy.com.
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