ABSTRACT

This paper chronicles the process and challenges of designing and delivering a comprehensive training class on the major components of the natural gas value chain. This training class was required to educate Papua New Guinea government personnel prior to the implementation of the then proposed $6 billion pipeline project from Papua New Guinea to Australia.

BACKGROUND

The proven and probable natural gas reserves of Papua New Guinea (PNG), Figure 1, are currently estimated at 15 trillion standard cubic feet (TCF) - equivalent to 3 billion barrels of oil and 15 times the remaining oil reserves of the country. Current production is at a nominal 15 million standard cubic feet per day. The government continues to be interested in attracting investment to expand its utilization. One of the scenarios investigated for gas development was by way of export of gas by pipeline to the Australian markets. A project of this nature would comprise the development of several gas fields in PNG and construction of a 22-26 inch diameter, 3300 km long gas pipeline from the gas fields to the markets in Australia. All oil and gas exploration and development is carried out by international oil industry investors under license from the state. The state receives royalty and income tax on oil and gas production and may elect to participate in the developments by taking an equity position of up to 22.5% of any development project pursuant to Petroleum and Gas Agreements made with the license holders. Comprehensive legislation for sector development is provided in the Oil and Gas Act of 1998. The Petroleum Division is responsible for the development planning and monitoring of downstream processes, facilities and pipelines for supply of natural gas to the markets in the country and overseas. The Engineering Branch of the Petroleum Division employed thirteen graduate engineers with degrees in mechanical, mining, and petroleum engineering and is tasked to:

  • a)

    prepare conceptual plans, preliminary designs, Capex and Opex estimates of the facilities;

  • b)

    conduct reviews of the development proposals submitted by the investors;

  • c)

    draft technical aspects of the basic framework of operating standards, safety codes, and commercial regulation of monopolistic operations; and

  • d)

    provide technical in-put in the conduct of in-house studies and promotions of gas resource development, utilization, and marketing.

To achieve the above capability, the Petroleum Division engaged the services of a consulting firm with expertise in the planning and engineering of infrastructure for natural gas and LPG gathering, processing, transmission, distribution and utilization; as well as technical regulation of gas infrastructure operations and compilation of standards. The mechanisms for achieving this capability involved the posting of experienced professional personnel in the Petroleum Division to design and implement a comprehensive training program, including training courses, in-house lectures, on-the-job training as far as possible on actual assignments of the Division, study visits, attachments with industry, as well as undertaking specific studies on gas markets and infrastructure development, utilization, technical regulation of facilities operations and compilation of standards.

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