BP plc has ramped up two major natural gas projects, in Trinidad and Australia, marking the fourth and fifth of seven new facilities set to get underway this year.
Juniper in Trinidad and Persephone in Australia follow the start-ups earlier this year of the first phase of the West Nile Delta development in Egypt, the Trinidad Onshore Compression project and the Quad 204 redevelopment in the UK.
“This is a significant year for BP and, with five of our seven planned major projects now onstream, delivery of our plan is firmly on track,” said Group CEO Bob Dudley. “This year’s projects will deliver a key part of the 800,000 boe/d production from new projects that we expect by the end of the decade. Importantly, these new projects, with their lower development costs and higher margins, also further improve BP’s resilience to the price environment.”
The first phase of the Khazzan tight gas development in Oman and development of the Zohr gas field offshore Egypt are expected to begin production before the end of the year.
Gas production from Juniper, the largest new project to start up in Trinidad in several years, began on schedule and under budget. Juniper was BP’s first subsea field development in Trinidad, and it is expected to boost BP Trinidad and Tobago’s (BPTT) gas production capacity by around 590 MMcf/d.
The development produces gas from the Corallita and Lantana fields via the Juniper platform, off the southeast coast of Trinidad. Gas then flows to the Mahogany B hub via a new 10km flowline. Juniper is BPTT’s 14th offshore platform in Trinidad.
The Persephone project off the coast of Western Australia is operated by Woodside Energy and is part of the North West Shelf Project joint venture. At peak production the project is expected to produce around 48 MMcf/d net for BP, which holds a 16.67% interest.
BP, like some Big Oil peers, including Royal Dutch Shell plc, has begun cranking up gas projects with an eye on the long-term. According to the benchmark 2017 edition of the "BP Statistical Review of World Energy,"last year was the first to see a growth spurt in liquefied natural gas (LNG), and global supply is forecast to increase by another 30% by 2020. Dale said. As LNG trade grows, the global gas markets are expected to evolve, a view held by BP economists for several years.
"Alongside increasing market integration, we are likely to see a shift toward a more flexible style of trading, supported by a deeper, more competitive market structure," BP chief economist Spencer Dale said. "Indeed, this shift is already apparent, with a move toward smaller and shorter contracts and an increase in the proportion of LNG trade, which is not contracted and is freely traded."