Six questions for Philippe Blanchard, Managing Director, Total E&P PNG

Papua New Guinea’s second LNG project is expected to be ready by 2023/24, according to Total E&P’s Managing Director in PNG, Philippe Blanchard. He tells Business Advantage PNG the company is also keeping its eyes open for other energy projects in PNG.

Business Advantage PNG (BAPNG): At what stage is the Papua LNG project?

Philippe Blanchard (PB): At the moment we are in the pre-feed stage and we need to finalise the final development scheme. We had initially considered a standalone LNG plant. But, since the partnership change in February 2017 and in order to improve project cost-effectiveness, we’ve been able to work more in detail with our partners on the feasibility of locating the Papua LNG liquefaction process within the existing PNG LNG plant. One of these options was disclosed to the market in February 2018.

So, we still have other options available, but that one is the most interesting one. It would mean having a total of five trains within the existing LNG plant.

We’re still aiming to target the early 2020s window to be on the market. During construction, we expect to employ 2000–3000 staff in the Gulf Province.

BAPNG: What about infrastructure in Gulf Province? Have you made any decisions about what you’ll need to have in place?

PB: People often ask me about the infrastructure that will be needed. We will have wells, and what we call trunk lines, which are smaller pipelines just to run from the wells to what we call the central processing facility.

‘If there are other opportunities in Papua New Guinea we’ll try to grasp them. We have not come to Papua New Guinea only for one project.’

Gas and condensate production will be firstly processed in this plant, and from there we will send production by pipeline to the liquefaction facility.

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In addition, we will have a logistic base managing goods transferred by river, and including also an airfield for personnel transportation. It will be used to bring in food, supplies, and personnel.

BAPNG: How important are the gas and the oil prices? Do these need to stay at a certain level for this project to receive the financing it needs?

PB: We’ll see when we negotiate with potential gas buyers. What is clear is that all the efforts that we are making today are aiming at a cost-effective project. If we are really cost-effective, we are in a better position to discuss with the buyers.

BAPNG: What is the geology of the area that you’ll be working in? Is it similar geology to the Highlands area where the earthquake struck in February?

Work at PRL 15. Credit: InterOil

PB: Earthquake occurrence is one of the identified risks as the fields and future facilities are located along faults similar to those involved in the Highlands earthquake. But the surface geology is different. It is my understanding that most of the surface geology in the Highlands is made of limestone, whereas in PRL15 it’s mostly shale.

We will be concluding a geophysical survey very soon to try to get a better image of the first 200–300 metres below ground.

BAPNG: How significant is this project for Total’s global business?

PB: Papua LNG is the next LNG project in the Asia Pacific for Total and our strategy is to keep growing our LNG business. So Papua LNG is an important project for us.

We want to develop in LNG because we believe it’s one of the fuels of the future. It is also part of the solution to manage climate change on which Total has engaged with the creation of its fourth business line: Gas Renewable and Power. Gas is an important part of our growth strategy.

BAPNG: Does that mean there are further opportunities for Total within Papua New Guinea that may not involve the Papua LNG project?

PB: If there are other opportunities in Papua New Guinea we’ll try to grasp them. We have not come to Papua New Guinea only for one project.

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