This article was corrected Feb. 10.
Horizon Oil Ltd., Sydney, has expanded its portfolio interests in western Papua New Guinea with the acquisition of Eaglewood Energy BVI, originally a Canadian entity that was acquired for $28 million (Aus.) in 2014 by Perth-based private independent Transform Exploration Pty. Ltd.
The deal gives Horizon an interest in the Ubuntu gas-condensate discovery that lies adjacent to Ketu-Elevala-Tingu fields along with an increased 80% interest in permit PPL 574 where the Nama-1 wildcat failed to deliver in 2016. Horizon also gains 100% interest in permit PPL 430 to the south, along a proposed pipeline route to Daru Island.
Transform Exploration was established by former Woodside Managing Director John Akehurst along with former Woodside Exploration Director Agu Kantsler and financier Andrew Burt. The company was a partner with Horizon in the Papua New Guinea permits, but has decided to sell following the failure of the Nama-1 well.
Horizon bought the assets with a view to the “long game,” according to the company’s Chief Financial Officer Michael Sheridan.
The Horizon permits contain a total estimated 1.5 tcf of gas resources and 60 million bbl of condensate in various discoveries. The company initially contemplated a condensate-stripping development beginning with Stanley field, but has now set its sights on a midrange LNG development.
One option is to gather the gas resources from the company’s fields and those nearby operated by others and pipe them to the coast. This revolves around ongoing talks with Papua New Guinea state-owned Kumul Petroleum Holdings to aid planning of an open-access Western Pipeline that will help the commercial prospects of developing several gas fields in the region and send the gas to Port Moresby. Alternatively, there could be a pipeline built south to Daru Island that is not reliant on third parties.
Much will depend on the outcome of exploration drilling planned by neighbour Oil Search Ltd. at the Koko and Kimu discoveries and how larger fields like P’ynang are ultimately developed.
To date, Horizon’s production of 3,800 bo/d is coming from its interests offshore China and New Zealand.
