Oil Search Limited is an oil and gas exploration and development company which was established in Papua New Guinea (PNG) in 1929. Most of the Company’s assets are located in PNG, where it holds an extensive spread of oil and gas production and exploration licences.
The Company’s main asset is its 29% interest in the 6.9MTPA PNG LNG Project, a world-scale liquefied natural gas (LNG) development operated by ExxonMobil PNG Limited. The Project commenced production of LNG in April 2014, ahead of schedule, and reached nameplate capacity in July 2014, just three months after first production. PNG LNG has transformed Oil Search into a regionally significant oil and gas producer with a long-term LNG revenue stream. The Project has also had a major positive impact on PNG, materially increasing export revenues for the country and providing a new income stream for the Government and the people of PNG.
In addition to the PNG LNG Project, Oil Search has interests in, and operates all of, PNG's currently producing oil fields. Since taking over operatorship of these mature fields in 2003, Oil Search has been successful in mitigating the production decline rate and adding to reserves through an active development drilling programme. Approximately 20% of PNG LNG Project gas is sourced from the Oil Search-operated oil fields.
Following the successful delivery of the PNG LNG Project in 2014, Oil Search is now working closely with its co-venture partners on the next phase of LNG development in PNG, focused on commercialising existing discovered gas resources. Appraisal and development activities are underway in the North-West Highlands (including the P’nyang gas field, operated by ExxonMobil PNG Ltd), to underpin a potential expansion of the PNG LNG Project, and in the Gulf Province (the Elk-Antelope fields, operated by Total SA), to support the proposed Papua LNG Project.
Beyond these discovered undeveloped resources, the Company believes PNG has material gas upside, with only half of the nation’s estimated resource potential of 10 billion barrels of oil equivalent discovered to date. As such, Oil Search’s exploration activities are focused on supporting the ongoing commercialisation of gas in PNG, by actively exploring in areas near the Company’s existing gas assets and refreshing the PNG exploration inventory with high-impact gas opportunities in proven and emerging fairways.
Offshore, the Company has exploration interests in the Middle East and North Africa, where it is focused on the disciplined pursuit of material, high-returning international liquids opportunities that offer the potential for significant growth and value upside.
In October 2014, as part of its 2014 Strategic Review, Oil Search announced a new business strategy and a refreshed Company vision: To generate top quartile returns for shareholders through excellence in socially responsible oil and gas exploration and production. This is underpinned by six key strategies, outlined in the 'Strategic Focus' section.