Oil Search Announces First Production from SE Mananda

Oil Search Limited reports that the SE Mananda field, located in PDL 2 in the Southern Highlands Province of Papua New Guinea, commenced production on Monday.

The field is producing oil from one well, but three additional wells will be tied into the gathering system over the next two months. Production rates are expected to rise to a plateau level of up to 7,000 bopd.

The joint venture participants in the SE Mananda field include Oil Search (72.27 percent working interest), AGL Gas Developments (11.9 percent), Merlin Petroleum (7.93 percent), and Petroleum Resources Kutubu (7.90 percent).

SE Mananda was discovered in 1991, but, due to its remote location and relatively small size, was thought to be uneconomic. By using an innovative approach to the many technical and commercial challenges and with cooperation from all stakeholders including the developers, government, and local community, Oil Search has brought the field into production.

The development comprises:

  • Four oil production wells
  • Gathering system
  • 16 kilometers of parallel oil and gaslift flowlines linking the wells into the existing Agogo Processing Facility
  • Expansion of the Agogo Processing Facility’s inlet separation and gas compression capacity
  • A cable suspension bridge carrying four pipelines (oil production, gas injection, and two chemical pipelines) across the 470-meter-wide and more than 400-meter-deep Hegigio Gorge.

"The SE Mananda Project is the company’s first operated oil development," said Peter Botten, Oil Search's managing director. "The project presented many technical and commercial challenges, the most obvious being crossing the Hegigio Gorge and the laying of pipeline over extremely rugged jungle terrain. The completion of construction of the 470-meter-long cable suspension bridge, spanning the Hegigio Gorge, and 16 kilometers of pipeline (most of which was built by hand) connecting the field to the Agogo Processing Facility, were major engineering achievements."

Botten adds that Oil Search's agreement with the Papua New Guinea government on fiscal incentives for the project was instrumental in ensuring the development's progress. Another critical step was the signing of a benefits sharing agreement between the three affected landowner groups, he said.

"The weather in this part of PNG was particularly inclement during the construction period and led to lengthy construction delays," said Botten. "This, together with a number of design changes and technical issues arising from the challenges of drilling in this geologically complex and remote area of PNG, resulted in an increase in budget with the final development cost estimated to be around US$145 million."