Update on Pandora License Application
Published on 6th August, 2021
The Twinza media release of the 5th August 2021 provided an update on the Pasca A Gas Agreement and also referenced the Pandora licensing process. Twinza applied through the PNG gazettal process for the Petroleum Retention License that covers the Pandora A and B Fields in November 2018.
The Company has worked closely with the Department of Petroleum since our application for Pandora on how best to commercialise the discovered, but stranded, gas fields that lie offshore. Pandora itself has sat undeveloped for over 30 years being uneconomic as a standalone project. Pandora and other offshore gas fields will almost certainly need to tie-in to the Pasca A facilities to be economic.
Twinza believes that the ownership of the Pandora Fields should be closely aligned to that of Pasca A ensure an optimum development and to simplify commercial discussions for access to the Pasca infrastructure. The FEED Phase on Pasca A is due to commence after the Gas Agreement is signed and Pandora would need to be included in the engineering design at this stage. The additional cost of accommodating Pandora in the FEED process can only be borne by the Pasca A Joint Venture if:
- the Pandora award is made around the time of the Pasca A Gas Agreement signing; and
- the operatorship of Pandora is awarded to Twinza with ownership of the two licenses broadly aligned.
Consequently, as part of the Pasca A Gas Agreement negotiations which concluded on the 6th July 2021, Twinza requested that the Minister for Petroleum, the Hon Kerenga Kua, announces the Pandora license award ahead of the signing.
Pandora will require at least one appraisal well to confirm the resource size and Twinza has included this undertaking in our application. Twinza is well placed to be awarded operatorship of Pandora, with the Company successfully drilling the Pasca A4 appraisal well in 2017-18. Twinza is one of only two operators that has drilled an offshore well in PNG waters over the last decade and has invested over 350 million kina on the Pasca A Project to date.
If awarded operatorship, Twinza will provide a free carry for the Gulf Province of a 2% ownership share in the Pandora license through a MoU signed in mid-2020 with the Gulf Province Governor, the Hon Chris Haiveta, a vocal supporter of gas aggregation.
Twinza Chairman and CEO, Ian Munro, stated,
“The Minister for Petroleum has a unique opportunity to align operatorship in Pasca and Pandora to ensure that gas aggregation in the Gulf of Papua can be delivered for the benefit of Papua New Guinea. Industry is closely watching the Pandora license award to gauge transparency and whether the Government will support a proven offshore operator and stimulate additional exploration and development investments.”
Twinza will provide a further update on the Pandora award when we have been notified of the Minister’s decision according to the Act.