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According to a projection, total earnings from the PNG LNG project would reach US$4.5 billion (K15.4 billion) in the fiscal year 2021.
According to estimates recently released by JMP Securities, PNG-based equity and fixed interest markets broker/dealer, Kumul Petroleum Holdings Ltd (KPHL) will earn between US$750 million and US$775 million (roughly K2.5 billion and K2.6 billion) from the project this year, based on current high prices.
It also estimates that total earnings from the PNG LNG Project to KPHL have been to the tune of US$5.1 billion (about K17.5 billion) since the project began operations in 2014.
“This is an estimate of revenue only,” said JMP Securities. “We are not in a position to comment on the overall costs of operations associated with the project or the wider operations of KPHL,”
“Given the current high international crude oil prices and the time lag between movements in oil prices and the pricing of LNG under long-term contracts, we expect continued benign trading conditions for PNG LNG in the coming months.
“This will result in a strong performance for the 2021 financial year as a whole.
“We estimate that the PNG LNG Project has sold LNG, condensates, domestic gas and naphta valued at US$30.27 billion between April 2014 and September 2021.
“More than 80 per cent of revenues come from the sale of liquefied natural gas (LNG).
“We estimate that the PNG LNG has sold the equivalent of close to 600 million barrels of oil since 2014.
“Around 100 million boe (barrels) have been sold by KPHL. KPHL sells around 35,000 to 40,000 boe per day.
“We estimate that the highest average quarterly gas export prices achieved by PNG LNG are US$14.41 (about K49.4) per mmbtu (metric million British thermal units). This was achieved in the June quarter of 2014 on modest volumes.”
In the September 2021 quarter, PNG LNG achieved around US$10 (about K34.3) in average gas sales prices.
“The lowest gas prices were achieved in the September quarter of 2020 – around US$4.2 (about K14.4) per mmbtu.”
Reference: Pacific Mining Watch (2 November 2021). “Papua New Guinea expects K15 billion from PNG LNG in 2021”.
