Santos specialist strengthens Contact skills set

Contact Energy, one of this country's biggest gas users, is enlarging its gas team and employing specialists to help it compete in the fast-approaching post-Maui age.
Santos specialist strengthens Contact skills set Santos specialist strengthens Contact skills set Santos specialist strengthens Contact skills set Santos specialist strengthens Contact skills set Santos specialist strengthens Contact skills set

It has recently taken on former Adelaide-based Santos team member Alex McAlpine as its upstream gas specialist.

"As the end of Maui approaches we need to better understand the gas situation facing this country; you cannot take it for granted that there will be ample supplies of gas in the future," McAlpine, a geoscientist, told EnergyReview.Net in New Plymouth.

"Contact needs to protect its gas interests and to do so it better needs to understand gas supply, both from presently producing fields and those yet to be brought onstream.

"My responsibilities will include providing technical detail on subsurface gas, evaluating the technical aspects of gas production, or doing technical due diligence on any tranches of gas that Contact may be offered in the future."

He also said people involved in the gas industry, whether upstream or downstream, needed to know such things as the difference between gas in-situ and recoverable reserves, and the different compositions of various gases and their best uses.

"There has been a lot of hearsay recently about what various prospects may contain and subsequently produce. One part of my job would be to help Contact understand the complexities of those issues from a technical viewpoint."

Contact is one of New Zealand's two largest gas users now that methanol manufacturer Methanex is running its Taranaki plants at less than half capacity.

It and fellow gas player Genesis Power earlier this week announced that Kellogg Brown & Root Pty (KBR) and Poten & Partners are to lead a six-month study into the logistical and market implications of importing LNG into New Zealand.

McAlpine - who has worked for Shell International, Fletcher Challenge Energy and founded Spectrum Exploration in the late 1990s - said he was not expecting to be involved in the LNG project.

"As a New Zealander I am hopeful that for the long term we will be able to meet gas and energy requirements from indigenous sources, not imported."

Some commentators are wondering if McAlpine's full-time appointment is an indication that Contact is about to get more involved in the upstream industry, as Genesis and NGC Holdings have done in recent years.

"Unless you are involved in exploration or production, what need is there for these people on a day to day basis? Even major oil companies only review reserves at most twice a year and the rest of the time the engineer is looking for new reserves or trying to find ways to enhance production from existing reservoirs," said one.

However, another said he did not think an upstream move by Contact was imminent. "Contact just wants to strengthen its gas team, primarily in the commercial and technical disciplines."

Several years ago Genesis took a majority stake in the formerly marginal Kupe gas-condensate discovery, though it is about to announce that Origin Energy is securing a 50% stake and taking over as operator of that field.

NGC, which has considerable upstream experience and skills, last year secured a 10-year first right of negotiation option for future gas discovered by Austral-Pacific, in return for a $NZ2 million prepayment.