PNG Tax changes for oil sector,
THE Government is expected to announce “favorable tax’’ conditions for the petroleum industry soon, Petroleum and Energy Secretary Joseph Gabut said.
Mr Gabut made the comments during a visit to an oil rig belonging to Oil Search Ltd and its partners at the offshore rig at Anama in Petroleum Prospecting Licence (PPL) 188.
He echoed the disappointments expressed by Oil Search managing director Peter Botten whose company and its partners had spent $US5 million exploring for oil but found nothing.
Mr Gabut commended Oil Search’s exploration efforts and said there should be more companies working aggressively like it.
“We need to intensify our drilling efforts and Oil Search Ltd has to be commended,’’ he said.
“The company has drilled three wells in the last two years and if we get the same interest from other big companies, we may make a discovery.
“It’s a real challenge for the Government and the industry if we are to have continued oil production. We may not see oil production in the next 10 years if there is no discovery soon.”
Mr Gabut said marginal or small fields needed to be given some tax incentives.
Without elaborating, Mr Gabut also indicated that some very favorable terms were being offered to the industry
in the PNG to Queensland gas project.
He said Prime Minister Sir Mekere Morauta was expected to make that announcement soon.
Meanwhile, about 380km north-west of Port Moresby or a 25 minutes flight by helicopter from Kikori to the mouth of the Kikori river, stands a rig with a drill which has been penetrating the
sea floor to 2825 metres in depth.
Collecting sand samples for analysis at the mud log shed are a team of geologists monitoring an automated system and keeping tag of samples which come in every five minutes and where
drilling takes place around the clock.
Oil Search, the largest oil and gas operator in PNG, is seeking to expand the exploration portfolio in areas with a combination of high prospectivity, favorable fiscal conditions and opportunities
for the company.
Oil Search notified the Government through the Department of Petroleum and Energy on Wednesday that its exploration attempts at Anama in PPL 188 had been unsuccessful.
There was an absence of hydrocarbons in the Iagifu reservoir but the presence of florescence indicated that hydrocarbons had passed through, well-site geologist Shane Schofield said.
He said the hydrocarbon charge would have indicated the source of pressure or where the heat was coming from and, thus indicated an oil base.
Mr Schofield said there were some indications of oil, with about 20 per cent porosity in the Iagifu reservoir but this was not enough for commercial purposes.
Mr Botten said there was a view in the industry to concentrate exploration in the forelands but there were still other parts of the country which must be explored.
Expressing disappointment in the $US 5 million exercise, Mr Botten said Oil Search was still keen on exploration.
He said PPL 188 was the first offshore drilling project in nine years for PNG and maybe the last for many years to come.
However, he said his company was considering whether to drill a second hole at Duadua, some 40km south of Anama. The company was expected to make a decision on the weekend.
PPL 188 is a joint venture between Oil Search Ltd, Woodside Petroleum and Gedd. It is operated by Oil Search.
It took Oil Search about 12 days to transport the rig by barge from Irian Jaya and another two days to mount the legs. Drilling started within four days and it took 21 days, up to Wednesday
last week to reach the targeted Digimu structure. The rig is about 50km from the Kumul terminal. |
