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West Australian
a day ago
- Business
- West Australian
BEN HARVEY: Many questions still unanswered on the North West Shelf project
Woodside Energy boss Meg O'Neill has a gas problem. The whole of Australia is about find out how offensive it is. It's not that O'Neill has too much gas. And this isn't an embarrassing 'I hope nobody gets in this lift' kind of dilemma. It's far more serious. The six-year process of extending the life of the sprawling North West Shelf gas project almost broke everyone involved: Woodside, the environmentalists who fretted the carbon footprint, the Aboriginal activists who saw ancient rock art imperilled and the government bureaucrats who did the policy due diligence. It ended with State and Federal politicians having to make a Sophie's Choice between climate action and protecting Indigenous culture on the one hand and economic reality on the other. Everyone involved will need a cup of tea and a lie down when Woodside finally responds to the Federal Government's demands and a deal is inked to keep the facility going until 2070. Don't break out the Twinings just yet, for this is not the end. It's not, to parrot Winston Churchill, even the beginning of the end. At best, it's the end of the beginning. The big question now is, where will the gas come from? How does Woodside feed a beast which, at one point, was the biggest engineering project in the world? The fields that currently sustain the NWS will keep the place humming until the late 2030s, albeit at ever-declining rates. Woodside might be able to squeeze a few more years by tapping some neighbouring reservoirs over which it has rights but 2040 is going to be pretty close to a hard stop. What then? Browse, right? Most analysts agree that Australia's biggest undeveloped resource will eventually be developed (it will be a long time coming when it is; it was discovered in 1967) but there is no guarantee it will feed the NWS. Respected energy analyst Saul Kavonic has for years argued that it is far more logical for Browse gas to be incorporated into the neighbouring Ichthys project run by Japanese energy giant INPEX. That would see the gas processed at INPEX's still-newish and very efficient LNG plant in Darwin. Kavonic says this would be an 'elegant solution' to the Browse conundrum. On paper it makes sense. The Ichthys field is 150 km from Browse — a long straw to blow through but a fraction of the 900km needed to connect Browse to the NWS. To put 900km in perspective, it's 10km longer than the underwater tube that connects INPEX's assets off the Kimberley coast to Darwin — and that pipe set a world record when it was completed. The competing costs of different pipeline routes isn't the only thing that Woodside must consider. Browse has a sasquatch-sized 's carbon footprint. Woodside would need to plant another Amazon rain forest to offset the emissions so the carbon will need to be sequestered. That technology is still hit and miss so you can bet London-to-a-brick that the company will put its handout for a taxpayer subsidy. We could see a bidding war between the Northern Territory and WA governments. Come to us and we will financially de-risk the sequestration process, the NT will say. We'll JV it with you and tell the punters we're pioneering new climate-saving technology. Have we got a deal for you, the politicians in Perth will plead. Come to WA and we'll fast track everything. We'll give it major project status and bypass every inch of red tape. We'll set fire to the Department of the Environment if we have to! If the economics are overwhelmingly in favour of Darwin Woodside needs a plan B for the NWS. Plan B could be acreage over which Chevron has options and which Woodside has been eyeing off for some time. That's interesting because right now the Federal Government is toughening up its use-it-or-lose provisions. Kavonic thinks at the very least this will give O'Neill the opportunity to pressure Chevron into supplying the NWS. The nuclear option would see the Feds strip Chevron of the fields it's been banking. Either eventuality would be bad news for Chevron, which needs those fields to backfill its Gorgon and Wheatstone processing facilities in the 2040s and 2050s. The supermajor needs to rinse every last dollar from its $100 billion investment in those plants, so the bosses in California won't go down without a fight. And, as anyone who has watched Landman knows, the only creature more ferocious than an American oil executive is an American oil executive's lawyer. If poaching Chevron's assets isn't possible then Woodside has only two cards to play, one offshore and one on. The Equus gas field, in waters 200km north of the Wheatstone project, seems a perfect solution. In 2022, Woodside struck a non-binding deal with owner Western Gas to produce and export three million tonnes of Equus gas as LNG through the NWS. The non-binding part is the most important take-out from that deal because the economics of Equus make no sense to even the most bullish gas price forecaster. The contract may as well have had the working title 'In case of emergency break glass'. The last option is the Perth Basin, where all roads lead to billionaires. The Ryan Stokes-controlled Waitsia project is already exporting gas through a swap deal with Woodside. It is about to directly feed the NWS but under policy settings designed to shore up domestic supply is only allowed to tap international markets until 2030. The Cook Government may need to extend that deadline when it comes to realise that domestic gas is a side hustle to the lucrative LNG trade but so far 2030 is set in stone. The rest of the Perth basin is a wholly owned subsidiary of Gina Inc. Rinehart has sprawling assets in the region but, so far, has shown little appetite to develop them. Even if she did drill a few wells, it's unlikely she could build a processing plant before 2030 and pipe the gas to the NWS for export. Rinehart could avoid the deadline crunch by striking a tolling deal with Waitsia but there's every chance she would turn her nose up at that option when she compares margins with the dizzyingly profitable Roy Hill iron ore mine. Put all that in a blender and you have an economic, political, environmental and social smoothie that will play havoc with Meg O'Neill's guts. And given gas is critical to this country's prosperity, we could all get indigestion.
Yahoo
2 days ago
- Business
- Yahoo
INPEX secures Onshore Block 4 concession in Abu Dhabi
Japanese oil company INPEX has secured a production concession for Onshore Block 4 in Abu Dhabi, United Arab Emirates, strengthening its Middle East portfolio. The Supreme Council for Financial and Economic Affairs of Abu Dhabi awarded the concession to INPEX's subsidiary Jodco Exploration (JEL). JEL will hold a 40% interest in Onshore Block 4, with Abu Dhabi National Oil Company (ADNOC) retaining the remaining 60%. The partners are set to jointly advance development and production activities in the region. This follows INPEX's participation in ADNOC's first competitive bid round in 2018, which led to the exclusive rights to explore Onshore Block 4 and the subsequent discovery of multiple oil, condensate and gas reservoirs after drilling operations in 2021. The production concession is expected to significantly contribute to INPEX's business expansion in Abu Dhabi, where the company has been operating for more than five decades. Apart from the Onshore Block 4 concession, the Abu Dhabi council has also awarded two other oil and gas production concessions. A production concession agreement has been awarded to ADNOC, ENI Abu Dhabi and PTTEP MENA for Offshore Block 2 in Abu Dhabi. The production concession is situated offshore to the west of the Ghasha field, focusing primarily on conventional gas resources. ADNOC will hold a 60% interest in the concession area, while ENI and PTTEP will hold 28% and 12% participating interests, respectively. The third and final production concession agreement has been awarded to ADNOC and Pakistan International Oil Limited (PIOL) for Offshore Block 5 in Abu Dhabi. PIOL will own a 40% participating interest in the concession area, located offshore near the Zakum field, primarily producing conventional oil resources. ADNOC will hold the remaining 60% interest. "INPEX secures Onshore Block 4 concession in Abu Dhabi" was originally created and published by Offshore Technology, a GlobalData owned brand. The information on this site has been included in good faith for general informational purposes only. It is not intended to amount to advice on which you should rely, and we give no representation, warranty or guarantee, whether express or implied as to its accuracy or completeness. You must obtain professional or specialist advice before taking, or refraining from, any action on the basis of the content on our site.
Yahoo
18-02-2025
- Business
- Yahoo
Petronas concludes Malaysia Bid Round 2024 with 14 PSCs
Malaysian state energy company Petronas, through its division Malaysia Petroleum Management (MPM), has concluded the Malaysia Bid Round 2024 (MBR 2024) with the finalisation of two production sharing contracts (PSCs), SB306A and SB306B. These PSCs, located off the coast of Sabah, bring the total number of new PSCs under MBR 2024 to 14. A consortium consisting of INPEX Malaysia E&P SB306A (INPEX), Petronas Carigali and SMJ Energy received the two PSCs. The MBR 2024 has attracted 12 different operators and includes 11 discovered resource opportunities (DRO) and three exploration blocks. Petronas has also entered into technical evaluation agreements (TEAs) for two regions, the Langkasuka Basin in the Straits of Malacca and the Layang-Layang Basin off the coast of Sabah, to enhance Malaysia's hydrocarbon potential. These agreements, involving seven oil and gas companies, namely bp, Eni, INPEX, Petronas Carigali, Pertamina, PTTEP and TotalEnergies, are part of Petronas' efforts to advance exploration in frontier basins. MPM senior vice-president Datuk Ir. Bacho Pilong said: "Malaysia continues to be a top-tier destination for upstream investment, offering extensive opportunities for industry players to expand their portfolios. The 14 PSCs awarded under MBR 2024 and MBR+ reinforces Malaysia's competitive edge and reflects strong investor confidence in the country as a leading Advantaged Energy hub.' Leveraging the success of MBR 2024, MPM has announced the launch of MBR 2025, themed 'Advancing Progress with Advantaged Energy'. The new bid round presents five exploration blocks in the Malay and Penyu Basins offshore Peninsular Malaysia, and the Sandakan Basin off the coast of Sabah. Additionally, three DRO clusters are available in shallow waters, close to existing infrastructure and potential gas markets, which could allow for swift monetisation. Meanwhile, Malaysian Prime Minister Datuk Seri Anwar Ibrahim has stated that Petronas will continue to uphold all of its current domestic and international contractual obligations in Sarawak, reported The Edge Malaysia. This commitment will remain unchanged even as Sarawak's state-owned oil company, Petroleum Sarawak Bhd (Petros), takes over gas distribution in the state as the aggregator, starting 1 March. Anwar told the lower house of parliament: 'This (Petros') role still confirms the previous approval given to Petronas and its subsidiaries.' However, the prime minister did not state if Petronas would have to secure a licence, or be subject to any additional procedures, to carry out petroleum operations in the Malaysian state of Sarawak. "Petronas concludes Malaysia Bid Round 2024 with 14 PSCs" was originally created and published by Offshore Technology, a GlobalData owned brand. The information on this site has been included in good faith for general informational purposes only. It is not intended to amount to advice on which you should rely, and we give no representation, warranty or guarantee, whether express or implied as to its accuracy or completeness. You must obtain professional or specialist advice before taking, or refraining from, any action on the basis of the content on our site.
