Papua LNG Project to Produce a Further 2–3 million tonnes per annum
by PNG Business News - September 26, 2022
Photo credit: TotalEnergies
By 2032, it is anticipated that the Papua Liquefied Natural Gas project (Papua LNG) would produce an additional 2–3 million tonnes of liquefied natural gas annually.
Given that Total Energies announced FEED (front-end engineering and design) for the Papua LNG Project in July of this year, Minister for Petroleum and Energy Kerenga Kua believes that PNG will export LNG in the ensuing decades.
The project, according to Mr. Kua, will virtually double PNG's LNG exports from the current 8.5 million tonnes per year to 14–15 million tonnes per year, he said during the 2022 National Petroleum and Energy Summit in Port Moresby.
“Papua LNG is likely to reach its final investment decision (FID) in late 2023 and with a four-year construction phase, we expect the first phase of LNG around the end of 2027 and late 2028,” Minister Kua said.
“This will be followed by FID and construction on P’nyang gas project with further plans to deliver 2-3 million tonnes per annum of LNG by 2032.”
According to Mr. Kua, as nations improve their renewable energy resources, LNG serves as a bridge fuel worldwide, and PNG is on the route to achieving that goal.
In the future, when they could be customers for PNG's export of green energy, he said that PNG's role as an LNG exporter will help.
According to Peter Larden, managing director of ExxonMobil PNG, PNG is in a good position to increase its LNG capacity as a result of the PNG LNG project's strong foundation.
According to Mr. Larden, the country has the chance to watch as new innovations take place, which might boost the economy of the country for many years to come.
“PNG exports somewhere between 8 and 9 million tonnes of LNG per year and even if the Papua Project comes online, it will still represent about 2 per cent of global demand or global supply through the 2030 period,” Mr Larden said.
The good news, he added, is that PNG has a variety of advantages because it can export LNG to fulfil demand across the world, particularly in the Asia Pacific area.
Jean-Marc Noiray, managing director of TotalEnergies PNG Ltd, stated that once the Papua LNG project is approved, Total would concentrate on the initial activities.
He said that Papua LNG is now developing its national content principles and practises to further drive these results into and through the massive project activity.
“The national content plan will provide the guiding framework and also the collection of reporting from across the project for our reporting to government,” Mr. Noiray said.
Reference: Wohi, Lorraine. Post-Courier (21 September 2022). “Papua LNG To Delicer By 2032”.
PNG Business News - February 15, 2021
PM Says LNG Project is Moving in the Right Direction
After the signing of the fiscal stability agreement, Prime Minister James Marap said that the Papua LNG project is going in the right direction. He gave confidence to the investors that PNG has an active democracy. “We appreciate very much that this project has now been moved,” he said. “The Government will ensure that all necessary support is procured for this project to be moved as our project developer moves into the FEED phase. Our country is moving into exciting years ahead. Let me sound this out to our investors: Today is a testament to what democracy in PNG is all about, irrespective of the politics that is at play. Our economy is in a very vibrant democracy. Our rule of law prevails, our judiciary always presides over matters that are in conflict. Our country has not terminated any project agreement during the life of the contract.”Apologising to investors that the government had caused them too much stress, he said, “The Government provides the social licensing, provides the security also. It needs to ensure that all ticks that need to be ticked are ticked, with respect to the laws that we have.”
PNG Business News - February 15, 2021
Oil Search Happy with Papua LNG Progress
Oil Search Ltd is happy to see the progress of the US$12 billion (K41.38 billion) Papua LNG project.According to Oil Search managing director Dr Keiran Wulff, “We are pleased to see further progress achieved on the Papua LNG. This milestone highlights the commitment from the Government towards Papua LNG and is a significant step in de-risking the project. It also demonstrates increasing alignment between the Government and the joint venture partners. We look forward to progressing the Papua LNG and announcing further milestones consistent with our strategic review announced last November.”Total, the operator of the project signed the agreement - together with ExxonMobil and Oil Search - signed an agreement with the government early this week. This is seen as a final step under the Papua LNG gas agreement to proceed with the project fiscal stability. Total managing director, meanwhile, Jean-Marc Noiray said that they welcome the “whole stabilisation of the project”.“The Feed (front end engineering design) itself will last between 15 and 18 months, from the moment we reach the final investment decision,” he said. “And from final investment decision to first gas, we have about four years of construction. It’s a long journey before we get to the first gas, and the first revenues for the developers and the country.”
PNG Business News - February 26, 2021
Oil Search Shows Strong Performance
Oil Search has brought a strong financial year in 2020 with a core net profit after tax of US$22.0million (K77m), also reported to a full-year production of 29.0 mmboe and the strongest safety performance since assuming operatorship in 2003.The financial results were significantly lower realised hydrocarbon prices in 2020 as compared to 2019, which resulted in a full-year net loss of US$320.7 million (K1.1bn). This includes a post-tax impairment charge of US$260.2 million (K908.7m) that had been recognised in the interim financial results.For managing director Dr Keiran Wulff, “Oil Search emerged from 2020 stronger and more resilient as a result of its response to the Covid-19 pandemic, demand collapse and oil price downturn. Despite the material challenges, Oil Search achieved three important records for the year. The first is the strongest safety performance in PNG since becoming the operator of the PNG oil fields in 2003, with a total recordable incident rate of 0.78 per million hours worked, and no Tier 1 process safety events.”According to Wulff, the second is the strongest production reliability from its operations in PNG since the 2018 earthquake and, the delivery of record annual production from the PNG LNG project.He said that the company brought down some decisive actions. “We also undertook a major strategic review to prioritise activities and capital spend for a low carbon future,” he said. “This resulted in streamlining our portfolio and incurring a non-recurring, post-tax impairment charge of US$260.2 million (K908.7m). We are a more focused, leaner and lower cost resilient business in a strong position to commercialise our world-class resource base and leverage the oil price. We will continue to focus on maximising operating cash flow and delivering material growth projects which will be underpinned by resilient operations and disciplined capital management. We have set up a dedicated transformation team to embed a high-performance culture across the business.”
PNG Business News - November 28, 2022
Port Moresby Chamber of Commerce and Industry holds 67th Annual General Meeting
The Port Moresby Chamber of Commerce and Industry (POM CCI) held its 67th Annual General Meeting at the Lamana Hotel on the 24th of November 2022 , present to witness the occasion were its members, executives and various stakeholders. The meeting was officially opened by the President and Master of Ceremony Mr. Rio Fiocco who gave his opening remarks and report. He thanked all the POM CCI staff for their hard work this year despite the challenges faced by covid and other changes in the administration. Some of their achievements highlighted included the recruitment of two graduate accountants from the IBS University and the employment of its new membership officer. Mr. Rio Fiocco stated that by 2023 the chamber will be working with Total PNG to pre-qualify its members to be contracted to early works stage of the Papua LNG project . "All members who have issues affecting their business can feel free to come and see us so we can lobby for you through NCD or if it government related we will also lobby for you through the PNG Chamber of Commerce and Industry", said Mr. Rio Fiocco. The treasurer of POM CCI Ms. Akae Beach presented the chambers Financial Report stating that it had made a net surplus of k114,020 which is a 12% net profit margin despite not recouping most of its membership fees. "The Port Moresby Chamber of Commerce and Industry Inc is in good financial position and our net asset stand at K1.49m compared with K1.38m last year , a healthy increase of 8 %. Whilst conditions remain challenging , I am confident that the chamber will continue to be in overall surplus in 2022 as we continue maintaining our current strategy ( with an increase focus on both the Corporate and SME sectors) whilst continuous improvement in our financial systems, increase online and physical marketing efforts and increase member initiatives" stated Ms. Akea Beach. Ms. Akae Beach concluded that she will be leaving the chamber by the end of the year but will still support the chamber within her own capacity.
PNG Business News - November 27, 2022
PM Marape, Ministers and star international business speakers headline PNG Mining & Petroleum Conference in Sydney
Prime Minister Marape headlines a star line-up of speakers at the 16th PNG Mining and Petroleum Conference, in Sydney in December, to promote international investment in PNG. Already over 1000 attendees are registered to attend, as the Conference features a dynamic and engaging program centered around Prime Minister Marape’s announcement of 4 new mega projects and the expected re-opening of Porgera gold mine. Prime Minister Marape will be providing the keynote opening address on Day 1. He will be joined by Australian International Development Minister Pat Conroy. Senior executives of the major international investors in PNG, including Newcrest CEO Sandeep Biswas, Harmony Gold CFO Ms Boipelo Lekubo, TotalEnergies Senior Vice President Mr Julien Pouget, Santos President Upstream Mr Brett Darlie and ExxonMobil PNG Managing Director Mr Peter Larden will be providing a global outlook for their companies’ operations around the world, how they have adapted to emerging trends and how their PNG investments fit into their global portfolios. A highlight will be CEO of Fortescue Future Industries Dr Mark Hutchinson’s presentation of Fortescue’s vision for how green hydrogen can be a gamechanger for the world and PNG’s envisaged role supplying hydrogen to the world. Day 1 concludes with a session featuring former Australian Foreign Affairs Minister, the respected Julie Bishop, presenting her view as to why Australia needs to invest more in PNG, and PNG’s Trade and International Investment Minister Richard Maru outlining the PNG government’s vision for investment and development in non-mining sectors. Each session on Day 1 will feature panels moderated by well-known Australian media personality Ms Ticky Fullerton. Day 2 of the Conference features policy statements by Mining Minister Ano Pala and Petroleum and Energy Minister Kerenga Kua, presentations by Kumul Petroleum and MRDC, project updates on all of PNG’s existing mining and energy projects, and the presentations of the next wave of resource and energy projects – Papua LNG Project, Pnyang LNG Project, Pasca Gas Project and Wafi Gold-Copper Project. Day 3 of the Conference features a unique 3 stream format focused on varied themes including Exploration growth, Climate Change & Energy, Improving Ease of Business, Infrastructure, and Business Success stories. Day 3’s program features a significant list of speakers including heads of government regulatory agencies, CEOs of various PNG and international businesses, and includes international institutions such as the IFC. The Conference concludes with a session that focuses on PNG success stories where resource revenues have been invested for future benefit, and a presentation on the importance of the PNG Sovereign Wealth Fund. “It’s an engaging and dynamic Conference program with a high-profile cast of speakers. I am very grateful for the support that the Prime Minister has provided to the Conference, and the unprecedented participation of Government Ministers and heads of departments and agencies as speakers. Industry and the PNG Government are presenting a united front in promoting PNG as an international investment destination at the Conference. We are pleased that we can work with the Government in this regard. The Prime Minister will be in a unique position in our history by speaking about the advancement of 4 major projects, and the potential doubling of PNG’s GDP in the near future, which can usher in significant economic benefits for our people.” Said Mr Anthony Smaré, President of the Chamber of Mines & Petroleum. “We are also very fortunate that so many high-profile leaders from some of the world’s largest companies have taken time out to come and speak at the Conference to outline why they believe PNG is an important place to invest in. Australian Minister Pat Conroy’s speech will give us an indication of Australia’s view of PNG’s importance. I am personally looking forward to the afternoon session on Day 1 when Julie Bishop will present her view as to why Australia needs to invest more in PNG, and Minister Richard Maru will challenge international companies and countries to invest more into the PNG Government’s investment priority areas such as infrastructure and agriculture.” “Over 1000 people are now registered to attend the Conference, but there is still some seats left, so I encourage business people not already registered, to quickly secure their seats at www.pngconference.com over the next few days. The Conference is unique because you can meet everyone who has a role in PNG’s resources and energy sector - Government policy makers and regulators, the business movers and shakers, landowners, financiers, investors, suppliers and contractors from all over the world – all in one place over three days from 5 to 7 December 2022 at the Sydney Hilton Hotel.”
PNG Business News - November 27, 2022
PM Marape supports development of oil palm industry on a massive scale in PNG
Photo: PM Marape and Governor Bird in discussions with representatives of Pacific Elite Palm Oil Group in Singapore on Monday (November 21, 2022). Prime Minister Hon. James Marape has given his support to development of the oil palm industry in Papua New Guinea on a massive scale. PM Marape gave his support after he and East Sepik Governor, Hon. Allan Bird, met with representatives of Pacific Elite Palm Oil Group in Singapore on Monday (November 21, 2022). The company currently runs an oil palm project in East Sepik, which it wants to emulate in all provinces, saying that it will be an economic gamechanger for the whole country. The company aims to create the largest agriculture-based wealth in the South Pacific, as well as generate electricity for PNG, using oil palm. Governor Bird told PM Marape that if a long-term oil palm development plan was drawn up, with the aim of economic independence for PNG, one million hectares of oil palm grown all over PNG would bring in an extra K100 billion for the country. “We can double our GDP just from palm oil,” he said. “If we go into downstream processing, this K100 billion could double, so that we could be earning K200 billion on top of our current GDP. “The other flow-on to the economy is power production that fits into the grid, carbon credits, increased cattle production, as well as jobs. “Palm oil is amazing because you can do so much with it, including green energy, which can be generated from the waste of palm oil. “If we have 33 operations throughout PNG, similar to what we are doing in East Sepik, 100,000 jobs would be created “This is brilliant.” Governor Bird told PM Marape that oil palm, when made into biofuel, would save the country millions of kina. “If we produce enough palm oil, we don’t need to go out and buy fuel, as we can produce our own,” he said. “It can also bring inflation down as we are no longer importing inflation. “I’m excited because it provides us an escape plan from all these things that are affecting us.” PM Marape welcomed the proposal by Pacific Elite Palm Oil Group and the ideas of Governor Bird, who has helped to grown the vanilla and cocoa industries in East Sepik, and PNG. “As regards expanding nationwide, I invite you to come to Port Moresby, and I will run the investment figures past the super funds and Kumul Consolidated Holdings,” he told the company’s spokesperson Alexander Tho. “A family of investors can easily mobilise the money required for the project. “I also want you to have a stake in the business, and run it, as we cannot do it on our own, in like what Barrick is doing at Porgera Mine.”