Oil Search

As a PNG company, Oil Search believe they have an obligation to improve the lives of Papua New Guineans.

Chairman, Richard Lee speaking at the Annual General Meeting in Port Moresby last Friday said Oil Search is continuing to invest in infrastructure, including roads and hospitals, and domestic power opportunities, in partnership with government.

“Delivering these projects helps create a stable operating and investment environment, which is essential for our continued growth.”

In its first quarter report, managing director Peter Botten said given the current environment of low oil and gas prices, Oil Search believes that cooperation between, and possibly an integration of, these two potential developments is essential to maximise value and avoid high-cost infrastructure duplication in PNG.

However, he said this will require cooperation from all stakeholders and commitment, hard work and dedication from his team at the hospital in Tari.

Speaking during the farewell ceremony for the Medecins Sans Frontieres (MSF) in Tari last Thursday, Botten sincerely thanked the MSF team for their significant contribution in saving thousands of Hela lives over the eight years that they had been in the province.

Botten, when commenting on the 2015 full year results said unlike some of their global energy peers, the company is committed, and has the financial capacity, to continue investing in its growth projects, despite the challenges of a low oil price environment.

“We regard the coming year as an ideal time to optimise our asset portfolio and we have the ability to take advantage of acquisition opportunities, should strategically sensible and well-priced assets arise.

This result was achieved despite 2015 being one of the most challenging years in recent history for the oil and gas industry.

Managing Director Peter Botten said despite strong operating results from their key assets, Oil Search is clearly not immune to low oil and gas prices.

“Fortunately, our producing assets are in the lowest quartile of operating costs in the region and we have a strong balance sheet, which allows us to continue to judiciously invest in what we believe are very competitive, potentially high returning growth projects.

The company stated in its fourth quarter report that they are still generating positive cash flow even at the current depressed oil price.

Given that PNG LNG Project expansion and the Papua LNG Project are considered to be among the most commercially attractive new LNG projects globally, activities to progress these potential developments will continue to be prioritised.

Guidance on 2016 operating costs and capital expenditure will be provided in the 2015 full year results, scheduled to be announced on Few 23, 2016.

Oil Search in its fourth quarter report revealed that nearly 80  percent were sold under long-term contract, with the ramp up of contract sales progressing in line with expectations.

They (Oil Search) sold 24 LNG cargoes during the period, 21 under long- term contract and three on the spot market, with four cargoes on the water at year end.

However, they are one shipment less compared to 25 cargoes in the third quarter, due to timing of deliveries.

Oil Search, one of Papua New Guinea’s leading businesses, waved off the bid by Australia’s biggest oil and gas producer to merge in late 2015.

The Papua New Guinea Government has a 10 percent stake in OSL.   

Woodside Petroleum on December 8 advised the Australian Stock Exchange that it was withdrawing its proposal to merge with Oil Search.

In response, OSL’s managing director Peter Botten said “as previously advised, the indicative Woodside proposal grossly undervalued the company’’.

OSL have 17 per cent stake the in PNG's LNG gas project.

Markham Bio-mass project developer, Oil Search yesterday signed the Power Purchase Agreement (PPA) with PNG Power today in Port Moresby.

Oil Search owns 70 percent of the project and Aligned Energy 30 percent.

The PPA agreement will see state owned electricity supplier purchase electricity to beef up its Ramu grid capacity.

The project is located in Morobe Province, and  more than 200,000 trees are being planted to feed this project.  

Kevin Miles, the Head of Grants for the Oil Search Foundation and a HIV expert with 25 years’ experience in the field of HIV, shared his personal and intimate account of caring for patients and loved ones with HIV in the early days of the epidemic.

“If we are to unite in the response to HIV, we have to share our stories, acknowledge our differences and decide how we will respond as individuals and as a community,” he said.

He recounted the enormous change he witnessed when anti-retroviral treatment became available and HIV was suddenly no longer a death sentence.