Oil Search looking at new projects
Initial shipments from the 6.9 million tonnes-a-year project will take place in 2014, although Oil Search has refused to indicate the number of shipments, saying only that it will run at peak capacity from 2015.
Exxon-Mobil is the operator of the Oil Search gas export project with a one-third interest, while Oil Search has a 29 per cent share.
Some of the initial cash from the gas export project will go to lenders, which may limit its initial options.
Commissioning of the first phase of the gas export project was "imminent", Oil Search managing director Peter Botten said, with the two-phase project now 90 per cent completed.
Capital management will start in 2015, once the project reaches financial completion. The aim was to get "the balance of growth investment and capital management right".
"We have a range of highly attractive growth projects," Mr Botten said.
These span prospective oilfields in PNG and the Kurdistan region of Iraq, and other PNG gas fields.
Frequently Asked Questions about this Article…
Yes. Oil Search is pushing ahead with several growth options, and the company says pursuing those projects may see its debt levels rise further ahead of cash flow from the Papua New Guinea gas export project.
The PNG gas export project is a US$19 billion, two‑phase development with a 6.9 million tonnes‑per‑year LNG capacity. Initial shipments were expected in 2014 with the project running at peak capacity from 2015.
Oil Search holds a 29% share of the PNG gas export project. ExxonMobil is the operator of the project and holds a one‑third interest.
Initial shipments and some cash flow were expected from 2014, with peak capacity revenues from 2015. The article notes that some of the initial cash from the project will go to lenders, which may limit Oil Search’s early options.
At the time of the article, the two‑phase project was about 90% completed and commissioning of the first phase was described as 'imminent'.
Oil Search said capital management would start in 2015 once the project reaches financial completion, with the aim of striking the right balance between growth investment and capital management.
Oil Search cited a range of growth projects including prospective oilfields in Papua New Guinea and the Kurdistan region of Iraq, as well as other PNG gas fields.
Based on the article, investors should be aware that Oil Search is financing multiple growth options which may push debt higher in the short term, while early cash from the PNG LNG project is partially committed to lenders and full capital management measures are planned to begin once the project reaches financial completion in 2015.
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