Page 8 - GLNG Week 42

GLNG AMERICAS GLNG
US regulators propose LNG-by-rail rules
POLICY
THE US Department of Transportation (DoT) is moving ahead with a proposal to allow LNG to be shipped by rail in DOT-113 tanker wagons.
e DoT’s Pipeline and Hazardous Materials Safety Administration (PHMSA) announced on October 18 that it would publish a notice of proposed rulemaking on the matter, in co-ordi- nation with the Federal Railroad Administration (FRA). e proposed rule will seek comment on changes to the Hazardous Materials Regulations (HMR) to authorise the transportation of LNG by rail.
Currently, the US only allows LNG to be transported in bulk by truck and ship. On a case- by-case basis, it may be transported by rail in a portable tank, which requires an approval from the FRA. But the US is now moving towards allowing a broader roll-out of LNG-by-rail a er US President Donald Trump signed an executive order to expedite the process earlier this year.
LNG-by-rail is already authorised in Canada, and allowing it in the US as well would make it easier for LNG to be transported between the two countries. It is also thought that moving LNG by rail could prove to be a viable alternative to pipelines. DoT o cials noted in a statement
that pipelines are not always able to meet the demand of – or reach – certain areas in the US that are accessible by rail.
“ is major rule will establish a safe, reliable and durable mode of transportation for LNG, while substantially increasing economic bene- ts and our nation’s energy competitiveness in the global market,” the PHMSA’s administrator, Skip Elliott, said.
e proposed rule comes a er the Associa- tion of American Railroads (AAR) submitted a petition to the PHMSA nearly three years ago, seeking authorisation for LNG rail shipments in DOT-113 rail tankers. e AAR argued that rail was safer than the use of trucks for transporting the fuel.
However, the petition received pushback from green groups, which argued the environ- mental impacts of LNG-by-rail had not been properly assessed.
e PHMSA has said the new rule would reduce the environmental impact of LNG transportation. However, environmental groups are likely to oppose its push into LNG- by-rail on safety grounds as well as on environ- mental concerns.™
AUSTRALASIA
Oil Search’s Q3 revenue slides 24%
PERFORMANCE
Oil Search’s production gures were dominated by the PNG LNG project.
OIL Search’s third-quarter revenue slid 24% year on year on the back of production interruptions and lower international oil prices.
e developer’s revenue slipped to $361.1mn in July-September from $474.9mn in the same period of 2018.
The company said damage at a one of the mooring chains at an o shore liquids loading facility in the Gulf of Papua meant crude pro- duction from the Kutubu, Moran and Agogo elds had either been curtailed or shut in during August and September. Priority access to availa- ble liquids storage was given to PNG LNG con- densate, it added.
As a result of these issues the company pro- duced 6.81mn barrels of oil equivalent (boe) in the July-September period, down 1% quarter on quarter and 10% y/y. Sales amounted to 6.47mn boe, down 4% q/q and 13% y/y.
In addition to the mooring chain issues, the timing of shipments, weaker global oil prices and a higher proportion of condensate relative to oil all contributed to the slump in sales.
Repair work on the chain was completed in mid-October, with standard loading operations
reinstated and production now ramping up to normal rates. The loading issue, however, prompted the company to revise down its full- year 2019 production guidance from 28-31mn boe to 27-29mn boe.
At the same time, Oil Search revised up its guidance for production costs from $11-12 per barrel to $12-13. Oil Search’s managing director, Peter Botten, said the higher costs re ected the “lower production base, costs associated with the repairs to the mooring buoy and lower insurance receipts for earthquake remediation activities than previously anticipated.”
Oil Search’s production gures were domi- nated by the PNG LNG project, which contrib- uted 6.2mn boe in period. e company said the project had operated at 20% above nameplate capacity during the three-month period.
Botten said he expected the PRL 3 joint ven- ture and the government to agree on the P’nyang gas development, which will feed a new 2.7mn tpy train to be built at PNG LNG, before the end of the year. ExxonMobil and Oil Search each own 36.86% of the venture, while Santos owns 14.3% and Merlin Petroleum holds the remainder.™
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w w w . N E W S B A S E . c o m Week 42 24•October•2019