THE February 26 earthquake and all the subsequent aftershocks in Southern Highlands and Hela provinces cast something of a pall over the Papua New Guinea Petroleum and Energy Summit, which concluded in Port Moresby yesterday.
Nearly three dozen speakers at the event, held at the Stanley Hotel, extended condolences to those who had lost loved ones in what has been described as the country's worst earthquake in more than a century.
Closest to home were the moving words from ExxonMobil's Andrew Barry and Oil Search's Peter Botten, whose respective companies were the first movers in rescue and relief operations, spending multi-millions of kina in cash and kind.
Prime Minister Peter O'Neill, in his opening address on Monday, was quick to acknowledge these two oil and gas firms, along with scores of other corporates which flung their weight into the relief efforts.
For those firms which did not offer physical help, many made donations to the Oil Search Foundation, adding to the war-chest to continue the good work it is doing. It must in no small way be quite gratifying to Botten and his team to receive this kind of acknowledgement from peer companies, who feel confident that the Oil Search Foundation will use donations wisely and prudently.
O'Neill said that the official death toll now stood at 150 lives, with the expectation that this figure would grow substantially.
In terms of the knock-on effect the earthquake will have on the country, the Prime Minister and his Treasury are painfully aware of the shortfalls to which the public purse will be subjected while the ExxonMobil operated PNG LNG project is put on suspension for two months.
The strong and reliable revenues from PNG LNG will, for the time being, disappear - as will the flow of cash from Ok Tedi copper mine, also currently shut down.
If ever there were a case of a country dependent upon its oil, gas and mining industry, last month's earthquake has exposed this sad reality of PNG's fragile economy.
The global LNG market, too, is expected to feel the stress of the PNG LNG project's suspension. Dr Fereidun Fesharaki, chairman of oil and gas consultancy FGE noted that the spot price of LNG would rise while PNG LNG was out of action, and then there would be a sharp downward correction when it roared back to life.
But despite the natural sadness of everyone attending the second such summit, which once again was strongly supported by government, there were many upbeat presentations on successful projects and many others in various stages of gestation.
Leading the way in this regard were the impressive PNG LNG statistics delivered by managing director Andrew Barry: 27 million tonnes and 374 cargoes of LNG over four years, with 8.2Mt and 110 cargoes delivered in 2017 alone.
PNG LNG is performing at 20% above nameplate production levels and has done this without a single lost time injury over four years or 10 million working hours.
Barry said that 300 ExxonMobil workers had to be evacuated from earthquake sites and there were no injuries suffered by his people. The company's facilities withstood the ravages of the earthquake with just some minor damage.
He pointed out that the real rehabilitation work in the affected areas would now begin, with trade routes being reconstructed and quick-growing corn being donated to give farmers a kick-start.
Botten said his company's cash aid in the wake of the earthquake had amounted to about K16 million with at least 70 Oil Search employees still involved in relief operations.
He pointed out that while the main earthquake registered 7.5, there were no fewer than 100 aftershocks, 20 of which measured 6.5 - the equivalent of a further 20 substantial earthquakes.
In other presentations:
• Petroleum Minister Fabian Pok said that a National Petroleum Authority will replace the Department of Petroleum, in an effort to reform the natural gas industry. Pok also said that oil and gas industry companies would be required to have social mapping and landowner identification (SMLI) approved by his department before a development licence would be granted.
• Total managing director Philippe Blanchard said that the initial Papua LNG project design concept had remained unaltered, with work currently being done to identify ways in which to maximise its efficiency.
• Kumul Petroleum Holdings chairman Sir Moi Avei called on industry to embrace the change to using gas to run industry. He said it was not about government preparing to "wield the big stick" over the domestic market allowance or the national content. "It is in our self-interest to embrace this change."
OSH Price at posting:
$7.17 Sentiment: None Disclosure: Held
