LNG News Editor:
Australian LNG producer Santos said a final agreement had been signed to give a framework for the Papua New Guinea LNG expansion project that would more than double output.
Santos said it had joined the Papua New Guinea Government and P’nyang project participants, including ExxonMobil Corp. and JX Nippon Oil and Gas Exploration of Japan to execute a gas agreement for the future development of the P’nyang gas fields.
Framework
The signing of the gas agreement marks a landmark for the PNG expansion, setting out the fiscal framework and supporting project scoping and evaluation.
“Subject to a final investment decision by the P’nyang participants, the ExxonMobil-operated P’nyang project would deliver LNG through new upstream facilities in Western Province linked to existing infrastructure, including our world-class PNG LNG plant near Port Moresby,” said Santos.
While ExxonMobil continues to operate the PNG LNG plant, Santos is now the main shareholder after its takeover of the Port Moresby-based oil and gas company Oil Search.
Santos added that up to 5 percent of P’nyang gas produced would also be made available to support the government’s electrification efforts in Western Province or another agreed location.
The P’nyang Gas Agreement for onshore gas fields are in the PRL3 licence area of PNG and the lack of an accord had been holding up the expansion project.
The separate Papua Gas Agreement for other feed-gas resources to enable the LNG expansion has already been approved and signed by the shareholders led by France's TotalEnergies and the PNG Government.
The Papua Gas Agreement covers petroleum retention licence PRL15, including the Elk-Antelope onshore gas fields, among the largest in the Asia-Pacific region.
“The signing of the P’nyang project gas agreement demonstrates the commitment of all parties to the project and will bring economic benefits for the people of PNG when the project is developed,” said Santos Chief Executive Officer Kevin Gallagher.
