The Project owners approved the decision to move the Project into Front End Engineering and Design (FEED) in October 2004, setting off a chain of events that has brought the Project to where it is now.

The Project owners have now achieved conditional sale agreements for substantial volumes of gas - notably after a few particularly hectic days in June which saw Alcan and AGL both sign conditional sale agreements for PNG gas, amounting to over 2,300 PJ (average 115 PJ/a).

The Project operator, Esso Highlands Limited, has said the focus for the Project will now be on converting the conditional gas sales agreements into firm contracts. While this is going on, a dedicated team of professionals will continue their work as part of the FEED studies into the pipeline.

Around 180 staff from Eos and 50 representatives for Project Operator, ExxonMobil, are locally based in the Brisbane offices. Eos is a 50/50 Joint Venture between WorleyParsons and KBR, with Intec providing specialist sub-sea pipeline expertise. A further 140 people are providing support from other WorleyParsons, KBR and Intec offices. The ExxonMobil Melbourne, Port Moresby and Houston offices also have a number of specialist staff supporting the project.

Of the 180 staff in the Eos Brisbane office, there are 30 working on pipelines, 20 working on infrastructure, logistics and construction and the remainder on project management, support and facilities. The FEED program has an estimated nine month duration and after commencing in mid-January has targeted completion of FEED in October, 2005.

As well as the main sales gas pipeline bringing gas from the Kutubu Central Gas Conditioning Plant to Australian markets, many more onshore pipelines are required to develop the project. The main gas source is the Hides field located northwest of the existing Kutubu oil operations, so a substantial gathering system is being designed to connect the wells to a new Hides Production Facility where the gas and liquid will be separated before going to Kutubu through separate 120 km gas and condensate pipelines.

A glycol return pipeline parallels these two pipelines to return lean glycol to the wells. A separate 92 km rich gas pipeline is planned to transport gas from the existing Gobe Production Facility to Kutubu. Overall, a total of more than 700 km of onshore pipelines are being designed with a further 440 km of offshore pipeline connecting PNG to Cape York.

The initial priority for the pipelines team was to select the pipeline corridors then kick off survey sub-contractors to select a centreline route within the corridor, survey the topography and identify features along the route. The survey corridors selected ranged in width from 100 to 300 m. The survey data was required as early as possible in the FEED process to allow the design deliverables to be prepared. Survey in PNG is very different to Australian conditions because the terrain is mostly dense jungle requiring control lines to be cleared before survey can proceed. The survey crews had to be supported by helicopter in many areas that do not have road access. Daily flights bringing in water and food were essential as well as moving the crews along the route. Helipads were cut into the jungle at intervals of around 3 km. Two separate contracts were let to Asia Pacific Surveys in the south and Arman Larmer Surveys in the north who together deployed 16 survey crews.

With the rate of progress able to be achieved by ground survey crews, it was not possible to survey the entire route of the onshore pipelines in this manner so aerial survey methods such as radar and lidar were investigated. A sub-contract was let to Fugro to conduct lidar survey over much of the route. Lidar technology is based on shooting laser beams from an aircraft (a helicopter was used in PNG) and measuring the return pulses to provide ground topography to an accuracy of approximately 200 mm. The main challenges in PNG centred around the weather and penetrating the triple canopy rain forest. The helicopter recorded data at 1000 m above the ground so any low cloud prevented the laser from reaching the ground. The weather is generally cloudy every day in PNG in July and August so it was a race to find enough clear weather windows to record data before the weather closed in. The helicopter was able to capture around 70 per cent of the required area before the weather closed in completely. Ground survey crews were deployed to pick up the areas missed by aerial survey. Surprisingly, the lidar penetrated the trees and foliage very well giving sufficient data points on the ground to make a comprehensive digital terrain model and 1 m contour maps.

The lidar recorded a 300 m wide corridor, providing scope to optimise the pipeline route back in the office. To enable construction of the pipelines and facilities as well as support future operations, over 100 km of new roads need to be constructed as well as the upgrade of existing roads. The route selection criteria for roads and pipelines is different in that the roads cannot have as steep a gradient as pipelines, hence the roads need to traverse the side of the mountains, snaking around ridges and gullies. Pipelines, on the other hand, attempt to take a more direct route staying on ridge lines where possible. Despite this significant difference in criteria, it makes a lot of sense to accommodate both roads and pipelines together when cutting a new swathe through virgin rain forest. A compromise in the respective criteria was reached in some cases whereas in other cases it made economic sense for the pipeline route to deviate away from the road and take a shortcut.

The pipelines are being designed to the Australian pipeline code, AS 2885, so the risk assessment process is central to the FEED design. Consideration of the risks associated with burying pipelines alongside and sometimes underneath roads received a lot of attention. Threats from excavation and road maintenance have been mitigated with the depth of burial, placement of marker tape and, in some cases, additional wall thickness.

The scope of the Eos study is limited to PNG and the offshore pipeline crossing to Cape York. The AGL Petronas Consortium (APC), is developing the pipeline network once it reaches Australia.

This Project has been through many well publicised phases over the last 10 years with a lot of work previously completed. The concept today is different from previous concepts so a lot of the detailed work has had to be redone in this phase. Previous project studies played a major role to help establish the current project model that has the best chance of becoming a commercial reality.

Some previous ground survey work had been completed prior to the FEED which proved to be very useful in both reducing the amount of survey data needed and to assist the corridor route selection required prior to survey. Other data such as previous geotechnical studies were also invaluable in the design of the pipelines. The personal experience of many team members involved in previous phases has been useful to assist in the evaluation of options that have previously been considered. Previous bathymetric survey data was also available for the offshore pipeline.

As well as the critical process of optimising the pipeline route, there are many other key decisions to make, each with several options requiring detailed evaluation. A substantial amount of transient flow modelling is required to determine strategies for pigging, hydrate suppression, management of liquid slugging, leak detection and line pack evaluation. Steady state analysis is used to determine the pipeline diameter and whether an internal flow coat is justified.

A detailed study was performed to select the grade of steel best suited for the project, considering many issues such as control of propagating fractures, availability, cost, weldability and ductility under loads such as earthquake and land slide. Grade API 5L X70 was finally selected for most of the pipelines. Many more detailed studies were performed to determine pipeline coatings and optimum construction methods. Once key decisions are made, specifications and drawings are prepared defining the selected options.

Once the important criteria of safety and environmental considerations are met, selection of the best option comes down to cost. The cost of each option needs to be estimated to an accuracy necessary to clearly demonstrate that it is the best. Sometimes this can be demonstrated with high level screening costs but detailed costing is sometimes required to establish the optimum solution.

With less than two months to go until the end of FEED at the time of writing, studies are mostly complete and the emphasis is on producing specifications and drawings for the project. Topographic and geotechnical surveys are mostly complete with a major effort now in defining the centreline route and engineering parameters on the alignment sheets.

Geographic Information Systems (GIS) are being utilised for this task with the alignment sheets automatically generated using a package developed by Epic. The use of GIS speeds up the process and ensures greater consistency and accuracy but it is still up to the engineer to carefully consider each section of the route to arrive at the best solution.

Eos has resourced the project with very experienced team members with substantial experience on pipeline FEED programs. ExxonMobil has a well-defined and established FEED methodology born out of the successful implementation of major projects around the world and defined through their suite of Global Practices. Combining the experience of both the Eos and ExxonMobil team members with well-defined practices results in a FEED that can be used as a solid foundation on which to launch any implementation phases of the Project. The whole team is very much aware that careful consideration of the issues to select the optimum solution is paramount at this early phase because the total cost of the project can still be substantially influenced. The procurement, detailed design and construction phases of the project are very important to do well but major cost savings can only be achieved by key decisions at this stage in the project.

The interface between the upstream work in PNG and the APC team responsible for the pipelines within Australia is being managed through regular interface meetings. The landfall at Cape York and flow assurance issues are key subjects requiring coordination.

The Eos team and the ExxonMobil team are all located together and are working together to achieve the outcomes.

Discussions have already commenced with potential construction contractors as a check on the construction strategies developed by the team prior to any formal bidding process. Pre-qualification packages have also been provided to prospective contractors.

The PNG Gas Project is a world-class project with a world-class team working on the FEED. Many of the ExxonMobil and Eos team members have come to Brisbane after working on similar world-class projects such as the ExxonMobil projects in Chad and Sakhalin. This team is supplemented with the best of the Australian and especially Brisbane-based staff to ensure that international best practice is moulded to suit local Australian and PNG conditions.