PNG confident with more LNG projects

THE PNG Government has no objection to and is confident of the feasibility of having another separate LNG project in the country. Prime Minister Peter O’Neill said yesterday the government has confidence in any new LNG project deemed feasible especially by investors. Mr O’Neill attributed the confidence based on what he said was PNG’s competitive cost structures and stable fiscal regime. He said this in response to comments made by the managing director of Kumul Petroleum Holdings Wapu Sonk over anti-competition concerns relating to ExxonMobil’s take  over of InterOil  interest in PNG oil and gas interests. He said despite the arrangement between the two there would still be two LNG operators. Mr Sonk told Energy Intelligence that “Exxon is not going to be the operator of Papua LNG. Total remains the operator of Papua LNG.”

 “But as far as the country is concerned, we are actually very happy because it brings two super majors to work together and explore the synergies with the existing fields and new fields coming on line. The resources are enough to build more trains.” He said whether it was possible PNG LNG’s proposed third train would have a different shareholder structure from the first two adding it depended on commercial negotiations among Exxon, Total and other partners. “It depends which is the most capital efficient way to develop the third train.

The government will have a say, noting that one possible scenario was to separate the upstream and pipeline business from the downstream development,” he said. Mr O’Neill when commenting on the projects said it is expected that despite global challenges, projects in PNG are well on track for delivery. “Negotiations are continuing and have yet to be finalised, the shareholders of this new project is yet to be settled and then negotiations will be concluded with the State and the respective partners,” he said. Meanwhile according to a Port Moresby Stocks Exchange release yesterday on the update of the transaction, the closing of the deal with ExxonMobil requires a final order from the Supreme Court of Yukon in the US. This was after the hearing that was held on September 27, and the court is considering the matter, including an objection filed by Phil Mulacek.