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Hi Nicodemus, I don’t intend to quell your admirable enthusiasm, and you might be talking long term yourself, but I don’t think BPC will need to have any EOR considerations for quite some time on wells being drilled now. I assume that in the event of success the primary production phase will last some years and only then for secondary/tertiary production will EOR requirements kick in? I’m beyond excited for what is on the cards on all the fronts here...
Would love to be a fly on the wall in PG’s office some days. I doubt he tracks too closely the daily SP movements, but with his insight into the expected news flow he must chuckle to himself when he sees people missing the patience to just hold tight.
Hello Mick. There’s plenty of ways to look at it. In my uninformed opinion, rather than calling it a dependency, maybe we can call it a mutual appreciation of capability. It’s right place right time stuff with a blend of vision, knowledge and talents (and of course for Massey’s part essential supply of CO2). The first mover advantage is poised in such a way that I think all parties realise they would be mad to mess with the formula. Big upside from
here for PRD for sure, of that there is no doubt.
Hello Mick,
Just to highlight ref Massey claiming some ownership - they have contributed more to the success of the pilot project than just the CO2 supply.
The following is taken from PRD’s own 2019 investor presentation. In addition to engineering, they also supply the equipment used for injection.
“ Massey has also agreed to provide the engineering for delivery of C02 to the wellheads exclusively for Predator.”
This doesn’t undermine PRD’s involvement, just highlights the strength of the collaboration...
Hi Matthindas, I am interested in your post.
The majority of it is unequivocally correct - typically new build FSRU commissioned by the very limited set of FSRU operators have come out of S. Korea’s big 3 shipyards - Hyundai, Samsung and Daewoo (Daewoo in process of merger with HHI ). China, as with everything, is muscling on on the act. Singapore has a fair chunk of the market if a conversion strategy is adopted. No FSRU would ever be ‘built’ in Europe/Africa and for sure PRD are not building one either for Ireland, but will be leasing an existing vessel from its partner (Norwegian if the Irish press can be taken as read = Höegh or Golar).
You’re also spot on that true FLNG has a sketchy track record and immense capex requirements for the most part. You need access to huge volumes of stranded gas too deep for a conventional development to make it viable. Those fields are few and far between...
The bit I am interested in for further education is the comment that seems to indicate that FSRU have an integral export power generation capability. From all my experience boil off gas either goes back into the tanks or can be used on the vessels own power generation. I have never known an existing FSRU to take gas and convert to electrical power for use onshore. Do you have any examples of that? A few companies in the market are looking at that application, effectively a deck with a load of gas turbines (jet engines) to produce electricity straight at source. Almost (if not all FSRU) offload gas into the grid or further storage connected to the grid. Happy to be corrected there - it sounds nitpicky but I what to ensure people picking up info on this board don’t misinterpret what is quite a fundamental part of PRD’s Irish plan...
Hi Nicodemus. An FSRU facilitates import only. There is an established set of players who own the vessels and I can’t think in the specific instance of Morocco why anyone would cut PRD into the deal, as there is no value add. Maybe that is short sighted. In their ‘non-core discretionary ventures’ where Morocco LNG is mentioned, I perceive that to be development of export capability. As per you comments it is both strange and somewhat encouraging that Morocco perceive a need to import gas.
Quiet day today. Bashers seem to have realised it is futile, and LTH watching and waiting with conviction. Feels like the calm before the storm... revisiting various bits of RNS etc I think I’ve grossly underestimated Trinidad value, eagerly anticipating the next piece of news there.
The attached article has a few points of interest, particularly the mention how the ‘45Q credits’ in the US work, which I wasn’t previously aware of...
https://www-politico-com.cdn.ampproject.org/c/s/www.politico.com/amp/news/2021/04/19/exxonmobils-carbon-project-biden-483253
Hi GRH,
I have the same instinctual feeling that PRD will be taken out whole. I’m no expert on how these deals are done and you clearly are so wouldn’t challenge the assumption that a conditional payment structure could be established. For me though either one of the catalysts of Ireland sanction or Morocco success would then make PRD an unbelievably attractive target for a major. One thing I am certain of is that however valuable T&T is in it’s own right, the value is magnified for PR purposes to someone like BP.
“ hard to see struggling oil producers part way with big profit margins” - surely as a ‘struggling oil producer’ gaining a percentage share of something you never had (increased production) is better than the alternative of doing nothing and taking only the profits from lower production rates?
You’re obviously well informed CLT but you ain’t half trying to talk down PRD prospects at every opportunity...
Clueless, steady on - with the pessimism on CO2 business unit people will think we’re one and the same... I was quite vocal on the fact I didn’t see the service model expanding outside the region (not because it couldn’t be done but because it wasn’t the right thing for PRD to focus on), but I am bullish about the opportunities in T&T and Caribbean region. Whilst I agree with you that it is hard to value, I concur with Jonmo - there must be something in it, PG doesn’t mess about. I look forward to finding out what the structure of the first deals looks like...
Hello Nigel, production from Rams head would be a good result for PRD. As to the benefit of injecting gas into depleted reservoir, that’s for capacity reasons long term I guess. It reduces the size of the unit you would need to provide gas, as there is already a large volume regasified product ready to go into the grid at the critical times. Maybe I’m not understanding it correctly of course...
Btw PT, happy to hold my hands up when I’m wrong - I had forgotten about the Golar Hilli FLNG vessel that operates for Perenco offshore Cameroon. That is an example of a much more modestly sized unit. So as per your comments there could be an outside chance of something like that appearing if Eire wanted to get serious as an exporter of gas (which doesn’t seem likely...)
Hi PT, MEM,
It’s all conjecture but in my view there is simply no commercial case that would warrant an FLNG unit developing gas from Rams Head. It’s just too expensive to execute. There is not enough gas in place to warrant the capex, and it also has easy conventional development options. PRD have earmarked it in past presentations as a reservoir where larger volumes of regasified LNG can be stored underground for times of high demand. That’s a different kettle of fish and not to be confused with FLNG in the truest sense as I described in earlier post..
Unless it has been superseded, current concept is two options of subsea tie back: https://www.energy-pedia.com/news/ireland/predator-announces-conceptual-ram-head-gas-field-development-176574
Hi GRH, apologies our messages must have crossed in the air...
Agree nothing is off the table where PRD and PG is concerned. If it is ‘best fit’ then they will adapt and make things happen.
More as an aside for posters who aren’t closely in touch with the LNG production/transport chain - we should make the distinction between true FLNG and floating liquefaction. FLNG is unbelievably capex intensive and has so far been used to target large stranded gas fields. It takes the full production, processing and liquefaction offshore - Shell Prelude FLNG, and the Petronas FLNG units are the only ones in operation to my knowledge and nothing like that would be considered for conversion of Moroccan onshore gas. Operational issues on these projects are also well documented.
The type of vessel you may be referencing would fall under ‘FLSO’ floating liquefaction, storage and offloading. These units are simpler because there is no gas processing necessary prior to liquefaction (simply because this has been done onshore prior). The major benefit there in relation to Morocco would be the agility - an onshore LNG export terminal is a permanent investment commitment. FLSO could be leased as required...
I just love the PRD onion - the more you look the more options are available to make the excellent fundamentals work (and maximise the value)
Hi PT, maybe not a T&T ‘partner’, but possible to source LNG from Atlantic LNG. The choice of source for export LNG is not actually that wide (especially when you rule out the US terminals for fracked gas reasons). Don’t see any reason that a direct transatlantic crossing from T&T wouldn’t compete with Asian sources.
With Petronas wanting to divest itself of liabilities for the Kinsale infrastructure, and PRD hoping to inherit, there must have been some discussions I guess, maybe they’ve come full circle and PN want in...
I revisited one of the corporate presentation updates and there is a reference to Morocco LNG under ‘non-core discretionary new ventures’. Shows it has been considered but I agree very unlikely to come to fruition.
Interesting one PT. in the Irish Business times article that is sometimes posted on this BB (with the 26billion valuation by the independent expert) the following extract is found:
“ Predator told the CRU it was “very keen to start the regulatory and environmental process as soon as possible,” as it already had a floating LNG tanker assigned by a Norwegian company.”
I think it’s a terminology mistake in the journalism and the ‘tanker’ should actually read FSRU.
The only two Norwegian providers of FSRU, and pretty much the market leaders by qty, are Hoegh and Golar (actually not HQ’ed in Oslo but effectively Norwegian).
I’m not saying you’re wrong of course, will be very interested to find out.