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Total delivers carbon neutral LNG cargo

ENERGY FRANCE’S Total announced this week that “The development of LNG is essential to meet
TRANSITION it had delivered its first-ever cargo of carbon the growth in global demand for energy while
neutral LNG. The cargo was loaded at the Ich- reducing the carbon intensity of the energy prod-
thys LNG terminal in Australia and delivered to ucts consumed.”
China National Offshore Oil Corp. (CNOOC) Total joins a small handful of companies that
on September 29 at the Dapeng terminal in have sold carbon neutral LNG cargoes to date.
China, Total said in an October 20 statement. Royal Dutch Shell accounts for the majority, hav-
The carbon footprint of the LNG shipment ing reported selling five carbon neutral LNG car-
was offset using Verified Carbon Standards goes since mid-2019. All of these cargoes went
(VCS) emissions certificates to finance two to Asian companies, including two to CNOOC.
projects. The first was the Hebei Guyuan wind Japan’s JERA has also made its first foray into
power project, which aims to reduce emissions carbon neutral LNG, selling a carbon neutral
from coal-based power generation in northern cargo to India in June 2019.
China. The second was the Kariba REDD+ For- Meanwhile, Singapore’s Pavilion Energy is in
est Protection Project, aimed at protecting Zim- the process of concluding a tender for the supply
babwe’s forests. of LNG whose emissions have been offset. When
For the cargo to be deemed carbon neutral, its it launched the tender in April, the company said
entire carbon footprint had to be offset. its ultimate goal for LNG deliveries was carbon
“This first LNG shipment, whose carbon neutrality.
emissions have been offset throughout the value These cargoes and tender represent only a
chain, represents a new step as we seek to sup- very small fraction of the LNG market, but have
port our customers towards carbon neutrality,” nonetheless attracted considerable attention.
stated Total’s president for gas, Laurent Vivier. More can be expected.™

AUSTRAL ASIA

Oil Search’s revenue nearly halved in Q3

PERFORMANCE AUSTRALIA and Papua New Guinea (PNG) gas prices, meanwhile, slid to $4.23 per mmBtu
listed Oil Search saw its third-quarter revenue ($117 per 1,000 cubic metres) from $9.44 per
fall by nearly half on the back of lower oil and mmBtu ($261.11 per 1,000 cubic metres) a year
gas prices. earlier.
Revenue shrank 47.6% year on year to Oil Search kept its 2020 production guidance
$189mn, the company said on October 20, unchanged at 27.5-29.5mn boe, while trimming
down from $361.1mn in the year-earlier period. its full-year investment expenditure guidance to
Weaker international oil and gas prices out- $390-460mn. It attributed the reduced budget
Production climbed weighed gains in both production and sales, Oil to the re-phasing of front-end engineering and
on the back of the Search revealed. design (FEED) entry for the Pikka Development
ExxonMobil-operated Output climbed by 7.2% y/y to 7.31mn bar- in Alaska and reduced exploration activities in
PNG LNG project rels of oil equivalent, while sales expanded by PNG.
continuing to perform 16.7% on the year to 7.55mn boe. Production The company noted that ExxonMobil
ahead of expectations. climbed on the back of the ExxonMobil-oper- remained in talks with the PNG government
ated PNG LNG project continuing to perform over the delayed three-train expansion of PNG
ahead of expectations, Oil Search managing LNG. However, it also said an anticipated sup-
director Keiran Wulff said. The facility produced ply shortfall in the global LNG market, which
6.55mn boe in the period, equivalent to an annu- had previously been projected to emerge by the
alised LNG rate of 8.9mn tonnes per year (tpy), middle of the decade, had now been deferred for
up from 6.17mn boe a year earlier. The compa- several years owing to the coronavirus (COVID-
ny’s oil production in PNG also climbed in the 19) pandemic.
third quarter to 681,000 boe from 302,000 boe Oil Search continues to look at cost-cutting
in the same period of 2019. initiatives, with Wulff saying: “Further work is
Oil Search said its average realised crude and being done on third-party spend, supply chain
condensate prices amounted to $36.52 per barrel and operational efficiencies to ensure cost reduc-
in July-September, compared with $59.54 in the tions are sustainable, with a focus on continuous
same period of 2019. Average realised LNG and improvement and performance.”™

Week 42 23•October•2020 www. NEWSBASE .com P17