Oil and Gas
PNG Business News - February 24, 2022
PNG Chamber Congratulates all parties on signing of P’nyang Gas Agreement
The Papua New Guinea Chamber of Mines and Petroleum congratulates the Papua New Guinea Government and joint venture partners ExxonMobil, Santos and JX Nippon on the execution of a gas agreement to guide the development of the P’nyang Project. Prime Minister James Marape, Petroleum Minister Kerenga Kua, Exxon Mobil’s Peter Larden and Santos’ Brett Darley, on behalf of the project partners signed the Project Gas Agreement Tuesday afternoon at Government House in Port Moresby, marking a major milestone for the project, and setting the fiscal framework and supporting project scoping and evaluation. President of the PNG Chamber of Mines and Petroleum, Anthony Smaré, said this major project will see the delivery of gas and condensate through new upstream facilities in Western Province linked to the world-class PNG LNG plant near Port Moresby. “The P’nyang project has been a long time coming, and all of the partners in the project, led by ExxonMobil PNG, must be commended for their steadfast commitment to ensuring negotiations on this project were resurrected, and now seen to fruition with this signing. The world is moving quickly under a new net-zero paradigm, and thus if we do not bring these projects onstream responsibly and expeditiously, then as a country we may lose that opportunity, and with that associated benefits and revenues in the form of taxation revenue, job and training opportunities, state company revenues, landowner revenues and benefits, and business opportunities for Papua New Guinean entrepreneurs and SMEs. ” Mr. Smaré said. “It was important that P’nyang, Papua LNG, Wafi and Porgera are progressed in a responsible and expedient manner to significantly boost the economy to help our country overcome is recent economic challenges. This announcement will improve investment confidence in Papua New Guinea internationally.”
PNG Business News - February 23, 2022
MILESTONE GAS AGREEMENT EXECUTED FOR P’NYANG PROJECT
Photo credit: Santos Ltd Santos has joined the Papua New Guinea Government and P’nyang project participants (affiliates of ExxonMobil and JX Nippon) to execute a gas agreement that provides a clear framework for P’nyang’s future development. The signing of the gas agreement marks a major milestone for the project, 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. Upon completion, up to five per cent of P’nyang gas produced would also be made available to support the government’s electrification efforts in Western Province or another agreed location. Santos Managing Director and Chief Executive Officer, Kevin Gallagher, said he welcomes today’s gas agreement and looks forward to supporting the operator to develop this valuable resource for the region and as long-term backfill for existing LNG infrastructure. “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,” Mr Gallagher said. “I thank the PNG Government and the government of Western Province for their partnership with the P’nyang participants to move towards P’nyang project development, which is proposed to commence following delivery of the Papua LNG project. “The P’nyang project will provide landowner benefits under a benefit sharing agreement to be negotiated in the future. Development of P’nyang will create local and regional jobs and business opportunities, provide training and skills development opportunities and help build stronger communities.” The P’nyang gas field is within PRL3, located in the Western Province of Papua New Guinea. Santos has a 38.5 per cent interest in P’nyang. Article courtesy of Santos Ltd
PNG Business News - February 18, 2022
CABINET CLEARS P’NYANG GAS AGREEMENT; SIGNING SET FOR NEXT WEEK
Prime Minister Hon. James Marape, MP has announced that his Cabinet has cleared the P’nyang Gas Agreement, which now awaits signing between the State and ExxonMobil who is the lead project developer of the Petroleum Retention License (PRL) 3. The Prime Minister said: "When I took office in mid-2019, I committed to the nation better results from resource projects we were going to undertake under my watch and today let me thank ExxonMobil for responding positively to our State’s position to earn more from our country’s national resources. "We started a protracted negotiation that included detaching P’nyang from Papua LNG terms and moving onto a separate template to gain more for the State but at the same time giving respect to our investors' return on their investments. “After almost two years of exchanges, I think we have found the sweet spot where investors will be happy and we the PNG beneficiaries including Western Provincial Government and Landowners will be happy.” The Cabinet meeting approved the gas agreement, which has the following unique features comparative to both PNG LNG and Papua LNG project agreements that the State Negotiation Team led by Chairman Dairi Vele successfully negotiated under Minister Hon. Kerenga Kua’s guide. Total state equity to be at 34.5% over and above the 22.5% allowed by oil and gas act, with ExxonMobil to offload 12% of their stake at fair market price to PNG parties of which PM has committed to offload most to Western Province and Landowners. Comparatively in PNGLNG we only have 19.6% and Papua LNG, the O’Neill Government signed up to only 22.5% as required by Law; Corrected the definitions of “well head value “of Royalty, Equity and Development Levy so that deductions only feature cost of harvesting the resources unlike present definition in both PNGLNG and Papua LNG; Secured additional production levy at 3% not given in PNGLNG project and Papua LNG is at 2%; Secured 5% of total gas domestic use at much cheaper price than Papua LNG’s DMO, a far bigger improvement from PNGLNG; No tax concessions except the increase on amortization cost and time period that will see PNG picking tax benefits in the later life of the project; License to develop is to be sequenced with Papua LNG construction where our country will see increase benefits to the economy with both Papua LNG and P’nyang LNG sequenced to construction from 2024 to 2032 instead of just four years for Papua LNG; With P’nyang coming on board, it means that PNG will be a gas producing nation up to 2060 and PNGLNG beneficiaries will collect toll revenue from P’nyang LNG in the period they are in production; The P’nyang infrastructure will have capacity to upload other third party stranded gas in Western, Hela and SHP into the future; The total project economic gain for PNG sits at 59% and with adjustments to the life of the project. It will rest at 63% all within the Marape-Basil Government mandate that SNT had used for the negotiations. PNG should note that in PNGLNG we are gaining at 49% and Papua LNG at 51% so above 59% to 63% is an all-time high for our country. PM Marape commended ExxonMobil for understanding PNG's aspirations by choosing to remain committed to unbundle the 4.4 TCF of gas that, if not developed, would remain in the foothills of our country’s hinterland. More details will be made when the gas agreement is signed next week Tuesday at the Parliament’s State Function room, the Prime Minister said. On a related matter, Prime Minister Marape mentioned Santos Ltd’s positive indications of additional equity in the PNGLNG project, based on his request to Santos if they offload equity in PNGLNG as a result of their acquisition of Oil Search assets. The Prime Minister commended Santos CEO Mr Kevin Gallagher for the good indications thus far saying this should recompense PNG parties in PNGLNG for dilution of their interest to only 19.6% instead of the 22.5% required by law. Article courtesy of the Department of Prime Minister & National Executive Council
PNG Business News - February 17, 2022
Crude Prices Impact On Import Parity Pricing
Photo: Napa Napa Oil Refinery in Port Moresby Puma Energy PNG, the country's largest fuel and energy provider, claims that changes in crude prices have a direct influence on energy market import parity pricing. Import parity pricing is a pricing mechanism used by goods providers to establish prices for their domestic sales to domestic consumers based on the opportunity cost of a unit of imported replacement products. The rise and fall of oil prices, according to Hulala Tokome, the country manager for Puma Energy, are being felt all across the world. Because petroleum and diesel supplies are nearing seasonal lows, he said the physical market is tight. OPEC continues to underperform, and constrained supply is being exacerbated by crude output limitations. “Decline in COVID-19 cases as well leading to strong pent up demand and crude production below expectations will continue to drive prices higher in the medium term,” said Mr Tokome. “Fuel prices surely do have an impact on any business operation.” According to him, the average MOPS (Mean of Platts Singapore) price has a one-month lag. As a result, the market's IPP (import Parity Pricing) is directly affected by the increase and decrease of oil prices. Mr Tokome confirmed that the country's gasoline and energy supply remains unaffected. “Our supply chain is working very well with fuel and energy supplies continue to be maintained in all regions of the country,” he said. Reference: Tom, Patrick. Post-Courier (14 February 2022). “Crude Prices Impact On Import Parity Pricing”.
PNG Business News - February 10, 2022
Minister Kua participates in virtual meeting with senior SINOPEC officials, led by Snr Vice President, Liu Hongbin
Petroleum Minister Kerenga Kua attended a virtual meeting in Beijing with Snr Vice President of Chinese Petroleum Giant SINOPEC. Minister Kua accompanied Prime Minister James Marape to Beijing and held a separate meeting to discuss various aspects of PNG's petroleum business, including how SINOPEC can best partner in upstream and downstream processing opportunities, as well as their interest in buying LNG from the Papua LNG Project and the P'nyang Gas Development Project. SINOPEC, as the first LNG customer of PNG LNG with a 2MTPA long-term (20-year) contract, is looking for other long-term LNG contracts for the PNG LNG projects that are due to begin FEED in the middle of this year. SINOPEC is also interested in Upstream involvement for existing projects as well as new licenses that provide the greatest investment potential. Minister Kua pledged to assist them with their entry into the Papua New Guinea petroleum business in a broader sense, urging them to engage with Kumul Petroleum Holdings Ltd, PNG's national oil company. Mr Kua was joined by Kumul Petroleum Managing Director, Mr Wapu Sonk who will now follow through on with SINOPEC for the working group between SINOPEC and Kumul Petroleum to immediately expedite the Papua LNG Project LNG Marketing, Upstream and Downstream Partnership and look into Ammonia as Blue Energy and carrier of Hydrogen for Green Energy Projects in the country. Reference: Department of Prime Minister and National Executive Council (6 February 2022). “Minister Kua participates in virtual meeting with senior SINOPEC officials, led by Snr Vice President, Liu Hongbin”.
PNG Business News - February 10, 2022
PM MARAPE APPLAUDS CHINESE PETROLEUM GIANT SINOPEC CONTINUED INTEREST IN PNG OIL AND GAS
Hon James Marape has praised and congratulated China's leadership for allowing for a very beneficial interaction to extend their country's continuous interest in Papua New Guinea's oil and gas industry, notably in two of the country's most important gas projects, Papua LNG and P'nyang. This was expressed by the Prime Minister in reference to discussions between his team and Sinopec, China's largest petroleum corporation, which took place in Beijing on February 5, 2022. PM Marape also expressed gratitude and praise for his Minister of Petroleum and Energy, Hon. Wapu Sonk, the managing director of Kerenga Kua and Kumul Petroleum Holdings Ltd, initiated discussions on his behalf with Sinopec's senior vice president on Saturday, February 5, 2022. The discussion focused on the petroleum industry in Papua New Guinea and Sinopec's engagement in upstream and downstream potential in the country, particularly Sinopec's interest in purchasing LNG from Papua LNG and P'yang Gas. “I express our deep gratitude to both President Xi Jinping and Premier Li Keqiang for asking Sinopec to meet with our Petroleum Minister and MD Sonk. The meeting has turned out very well with Sinopec indicating it would look at buying more gas from Papua LNG, P’nyang and others we may have in the pipeline,” said Prime Minister Marape in Port Moresby today. “Our intent for the trip to China was to promote our government’s move into downstream processing, a message that was received well and supported in full by Premier Li during my own virtual meeting with him, leading to him committing his government’s full assurance. “It was very unfortunate that the scheduled meeting on Friday with President Xi had to be cancelled due to COVID-19 restrictions, but the meeting the next day with Premier Li went well, for which I am grateful. “I am pleased with the outcome as we look forward to having our own leading petroleum company, Kumul Petroleum Holdings Ltd, partner with Sinopec to progress the discussions into practical solutions for both our countries,” said the Prime Minister. Sinopec is a long-term LNG client for PNG LNG, with a contract that lasts up to 20 years, and this re-engagement with PNG will expand Sinopec's investment in PNG oil and gas. China Petroleum & Chemical Corporation (Sinopec) is an abbreviation for China Petroleum & Chemical Corporation. The corporation, which is registered as a state-owned enterprise, is China's largest supplier of oil and petrochemical goods and one of the world's largest. Reference: Department of Prime Minister and National Executive Council (7 February 2022). “PM Marape Applauds Chinese Petroleum Giant Sinopec Continued Interest In Png Oil And Gas”.
Place your Ad Here!
PNG Business News - January 24, 2022
Juha Gas Field Gas Production Yet To Begin
Photo credit: Oil Search According to Petroleum Minister Kerenga Kua, the production of liquefied natural gas from the Juha petroleum development licence nine (PDL 9) region in Western has yet to begin. Kua stated this in response to Western Governor Toboi Awi Yoto's inquiries concerning the PNG LNG project's integration with other PDL regions and the pipeline's construction into Juha. Yoto also inquired as to why Juha landowners have not received any royalty payments since the project began. In response, Kua stated that he was unsure of the cause for the non-payment of royalties, but pledged to investigate and respond to Yoto. “Juha is part of the integrated PNG LNG project,” Kua said. “There are several areas which have been combined and integrated under the development of the PNG LNG project and Juha is one of them. “But when it comes to the development (such as royalty payments) of the various PDLs, they stagger it and are doing it one at a time. “Up until recently, they didn’t complete Angore and Juha for various reasons including court proceedings and injunctions but finally for Angore, we have resolved the issues and now the developer (ExxonMobil Ltd) has started work to build a pipeline to bring it into production. “For Juha, this has not happened yet. “There is no pipeline into the PDL 9, Juha area. And no production has taken place out of that licensed area. “However all the royalty entitlements for the pipeline routes have been up to date, only a few PDL areas are still outstanding. “Whether Juha is outstanding or whether production has not started or if landowner identification process has not been completed, I’m am not sure.” Yoto also encouraged Kua and his department to tackle the Juha matter apart from other LNG-related issues in PNG, such as those in the Highlands. Reference: The National (20 January 2022). “Kua: Juha gas field yet to start production”.
PNG Business News - January 04, 2022
Twinza Oil Appoint Robert Gard as CEO
The Twinza Oil Limited Board of Directors is pleased to announce the appointment of Robert Gard as the Company’s new Chief Executive Officer, commencing on Monday 17th January 2022. Robert has over 35 years of experience in oil and gas including 12 years as a senior executive in junior Australian-based oil and gas companies and 23 years at ExxonMobil. Robert joins Twinza from Denison Gas Limited where, as CEO since May 2019, and prior to that in a senior commercial role, he played a pivotal role in establishing the company as a natural gas producer into the East Coast Australian Gas market. While at Denison Gas, Robert oversaw the consolidation and integration of several gas fields, successfully upgraded asset reserves through a targeted drilling campaign, and secured a reserves-based lending facility with a major Australian bank, strategically positioning the company for solid growth over the next decade. In 2018-19, in parallel with his early Denison Gas commercial work, Robert was CEO of ASX listed Pilot Energy (ASX:PGY). Robert also worked for 8 years at ASX listed “MEO Australia Limited” (now Melbana ASX:MAY) where he negotiated its Production Sharing Contract (PSC) with the Cuban Government. In that role he also completed high value farm-out agreements with Petrobras, ENI and Origin Energy in Australia, and worked on ventures in Thailand, Indonesia and Malaysia. Robert’s career foundation comes from 23 years with ExxonMobil where he worked across the whole value chain, including in engineering, subsurface and commercial roles. He has worked in multiple Australian production joint ventures and was involved in the early stages of bringing the PNG LNG Project to commercialisation. Commenting on the appointment, Twinza Chairman Stephen Quantrill said, “Robert joins us with a proven track record of executive leadership and management, including negotiating and closing complex agreements with multiple counter-parties in Australia and overseas, and in managing assets from early stage development into production. We look forward to Robert joining us for the next exciting stage of Twinza’s journey as we put in place the agreements and the organisational capacity necessary to take the Pasca A project through to development for the benefit of the people of Papua New Guinea.” Commenting on his appointment Robert said, “I am delighted to be joining the Twinza team and to return to the PNG energy industry. We have an extremely exciting and valuable project ready to go and I look forward to helping advance it to development so that its full value can be realised and shared with the people of Papua New Guinea.”
PNG Business News - December 21, 2021
Kumul Petroleum delivers over K550 million in LNG dividends
Photo credit: PM James Marape News Page - PM Marape (right) receiving the K200 million from KPHL Chairman Ben Yaru The Papua New Guinea government, five PNGLNG-impacted province governments, and landowners have received a total of K551.82 million from Kumul Petroleum Holdings Limited, the country's largest oil and gas business (KPHL). Hon. Prime Minister David Cameron On behalf of the state, James Marape received a K200 million cheque, while the five province administrations received checks totalling K62.635 million. A total of K189.189 million will be distributed to landowners in these provinces. These dividends — benefits directly from the PNGLNG project deal – were delivered to the recipients in a dramatic presentation event that emphasized the strength of equity ownership, as advocated by Prime Minister Marape. PM Marape accepted funds on behalf of the National Government and province governments whose governors were not present, while governors of the Gulf and Southern Highlands, Chris Haiveta and William Powi, expressed their thanks for the "long-awaited, two governments later" payments. With the non-transfer of the 4.27 per cent equity committed to under the Kokopo UBSA in 2009 since 2014, Prime Minister Marape's Government urged KPHL to uphold the spirit and meaning of the PNG LNG project agreement, which has cost PNG K5.2 billion since the first gas export in 2014. This preferential dividend of K281.82 million recognizes the fact that the National Government has refused to allow these beneficiaries to exercise their purchase options since 2013, instead of investing the 4.27 per cent equity parcel from 2014 in the failed UBS loan for Oil Search Ltd Shares and other government obligations. As a result, the Marape Cabinet authorized KPHL to reconcile 'opportunity cost' and 'time value' losses, and to provide proportionate benefits to the five PNGLNG provinces and their landowners now and in the future. The State received a K100 million check earlier this year, increasing the total to K300 million. This payment is in accordance with the KPHL 2021 year operational plan and the national budget 2021. According to the percentage allocation, the province administration of Hela received K28.5 million, SHP K19 million, Gulf and Central K6.3 million each, and Fly River K2.52 million. This amounts to K62.635 million in total. The Prime Minister praised and complimented KPHL, its board of directors, and management, describing the firm as PNG's "flagship enterprise." He stated that the distribution of Kroton equity and other advantages had been delayed for a long time and that it was excellent to see it finally resolved. He further stated that one of the reasons for his departure from the previous PNC-led administration was the delay in the release of this 4.27 per cent equity. “It is very unfortunate that $291 million or over K1 billion of what would have been the 4.27 per cent Kroton equity money was squandered through the O’Neill submission that his cabinet approved for the ill-fated Oil Search shares. It was painful, “ he said. “That is why today is a beautiful day to witness this happen, as we continue to take back more of our resources for our people. This is one tick off on my commitments to our country.” The Prime Minister has urged that the five provincial governments spend the monies wisely to develop their provinces which still remains far from being developed despite carrying PNG’s oil and gas productions since 1990. Meanwhile, PM Marape has directed KPHL to fully detach the 4.27 per cent and establish a separate subsidiary structure to handle investments and provide dividends to beneficiaries. Additional equities that may be available in PNGLNG, Papua LNG, or P'nyang gas resources, he has indicated, will present greater opportunities for more equities for Kumul, provincial governments, and landowners in the future, subject to negotiations his government is holding with the current joint-venture partners. This 4.27 per cent subsidiary will hold further shares for our provinces and landowners in the Western, Hela, SHP, Gulf, and Central provinces in the future. All provincial governments and landowners have been urged by the Prime Minister to establish this permanent institution outside of Kumul to handle their shares in those projects. Reference: PM James Marape News Page (15 December 2021). “Kumul Petroleum delivers over K550 million in LNG dividends”.
PNG Business News - December 14, 2021
SANTOS WELCOMES LISTING ON PNGX
Santos is pleased to announce that it has listed on the official list of the PNGX, Papua New Guinea’s National Stock Exchange, following approval by the Board of PNGX of Santos’ listing application as an exempt foreign entity. The listing of Santos’ shares on PNGX relates to Santos’ merger with Oil Search Limited (Oil Search) which became effective on 10 December 2021. Santos commenced exploration in PNG in 1987 and production from the SE Gobe field in 1998. Santos’ interests in PNG today primarily relate to the PNG LNG Project. Santos’ merger with Oil Search is expected to support the development of key projects in PNG, including Papua LNG, delivering new jobs, helping to support the local economy, and continuing to support the development of and investment in PNG. Santos shares will commence trading today on the PNGX on a deferred settlement basis under code STODA. Normal settlement trading of Santos’ shares on the PNGX, under code STO, is expected to commence on 20 December 2021.
PNG Business News - December 14, 2021
SANTOS AND OIL SEARCH MERGER BECOMES EFFECTIVE
Santos is pleased to announce that the merger with Oil Search is now effective following the approvals by Oil Search shareholders and the National Court of Papua New Guinea. Oil Search shareholders will receive 0.6275 new Santos shares for each Oil Search share held on the record date of 14 December 2021. Santos Chairman Keith Spence said: “The merger combines two industry leaders to create a regional champion of quality, size and scale with a unique and diversified portfolio of long-life, low-cost oil and gas assets. “We look forward to integrating our businesses to create one high performing team – with a vision of becoming a global leader in the energy transition,” Mr Spence said. Santos Managing Director and Chief Executive Officer Kevin Gallagher said: “Santos and Oil Search are stronger together and will have increased scale and capacity to drive a disciplined, low-cost operating model and unrivaled growth opportunities over the next decade. “The merger creates a company with strong and diversified cash flows, providing a platform to deliver shareholder returns and successfully navigate the transition to a lower carbon future. “Additionally, the merger builds on our industry-leading approach to ESG through the combination of Santos’ leading carbon capture and storage capabilities with Oil Search’s social programs in PNG and North America,” Mr Gallagher said. Following the implementation of the merger, three non-executive directors from Oil Search will join the Santos Board. Santos’ head office will remain in Adelaide. Article courtesy of Santos
PNG Business News - December 08, 2021
K8 Billion Expected to be Brought into PNG Economy by Pasca A Project
According to Twinza chairman Stephen Quantrill, the Pasca A oil and gas project in the Gulf is estimated to bring in about K8.6 billion in direct revenue to the government throughout the project's lifetime. A total of K500 million in tax and royalties is projected to be paid in a year, according to Quantrill, who spoke at the 2021 Mining and Petroleum Conference. He stated that the project's final investment decision (FID) will be made in 2023. “The Prime Minister noted that the country is open for business and, we are here and believe in PNG’s bright future,” he said. “We are working to achieve alignment and certainty so that 2022 can be Pasca’s time to shine for PNG. “This is an important project in the scheme of the country’s economic future. “Over the life of the project, we believe that the direct revenue to PNG would be over K8.6 billion resulting in over six per cent increase to PNG’s annual direct revenues over the life of the project. “It has a forecast of expansion of the PNG economy through a multiplier effect of more than two to three times PNG’s share of direct project revenues. “We expect to contribute K500 million annually to taxes and royalties. “We have a development cost of about K5 billion.” Quantrill estimated that his business would spend roughly K600 million in Papua New Guinea during construction, with an additional K400 million in operational expenditures. “There will be further benefits that will flow from the project with the expansion of the offshore resource industry as we are the first mover in that space to provide an opportunity in the development of adjacent assets and also with the ability to supply PNG with domestic liquefied petroleum gas.” According to Quantrill, the project was a straightforward build in shallow water offshore. “We can use industry-standard technology in a phased development with an initial extraction of liquids followed by the second phase of flouting LNG development in the second stage.” Reference: Pacific Mining Watch (5 December 2021). “Gas project to bring in K8 billion into PNG Economy”.
PNG Business News - December 08, 2021
Santos May Pursue PNGX Listing
According to the company, Santos Ltd may pursue listing on the PNG National Stock Exchange (PNGX). Santos Managing Director and Chief Executive Officer Kavin Gallagher said the business was exploring it as the merger with Oil Search developed. “Momentum continues to build for the compelling opportunity to create a company with the size and the skill to fund the energy transition,” he told the PNG Mining and Petroleum conference yesterday. “It is also our intention to seek to establish a secondary listing on the PNG Exchange. “This will importantly allow all the PNG-based shareholders to trade their Santos shares on the exchange.” Gallagher claimed he had discussed his company's beliefs with Prime Minister James Marape on multiple occasions. “This merger will create an entity that will have the advantage to fund major projects in PNG and will facilitate the creation of a highly-skilled workforce and progress long term wealth and prosperity of the people of PNG,” he said. “Importantly, the merged entity will bring significant benefits to shareholders and PNG including more than 4,000 Oil Search shareholders who currently live in Papua New Guinea.” Santos had made multiple pledges to Marape regarding job security following the merger, according to Gallagher. Reference: Pacific Mining Watch (5 December 2021). “Santos considering listing on PNG Stock Exchange: CEO”.
PNG Business News - December 08, 2021
PNG LNG Project Earns K11B
Photo credit: Oil Search According to ExxonMobil PNG Ltd, the PNG LNG project has earned K11 billion in revenue for the government thus far. This was announced by managing director Peter Larden at the recent PNG Mining and Petroleum conference. “Up to October this year, PNG LNG has generated K11 billion in revenue to the State and landowners, which obviously supports investments and services and infrastructure across the country,” Larden said. “In addition, K15 billion in business opportunities (were) generated across the country from the project.” Papua New Guineans made up more than 91 per cent of the company's workers, according to Larden. He also revealed some of the firm's plans. “In July this year, I announced the restart of Angore project which was suspended in 2020 because of the pandemic,” he said. “Angore was part of the original project development plan. “This year, we engaged with the Government and the State Negotiating Team on the P’nyang LNG project. In September, we entered into an important head of agreement in Houston, Texas. “Since that time, we have been in active discussions on the gas agreement and we remain committed to progressing those to a conclusion. “P’nyang will construct new upstream facilities in Western and link them with existing pipeline infrastructure and the LNG plant in Caution Bay. “It will be an in an independent project, covered under a future benefit-sharing agreement. “Gas from P’nyang will support domestic power supply, improving access to electricity power to Western and surrounds. “We are also proud to be part of the Papua LNG project. Momentum is building with studies underway with front-end engineering set to begin next year. “The two projects could last up to a decade of continuous construction activities. “This would be significant to the country with potentially more than K65 billion.” Reference: Pacific Ming Watch (6 December 2021). “PNG LNG generated K11billion revenue”.
PNG Business News - December 06, 2021
Parliament Enacts Oil and Gas Bill
The Oil and Gas (P'nyang LNG Project) (Amendment) Bill 2021 was just enacted by Parliament. The development partners in the P'nyang LNG Project will now be able to submit for an application and a petroleum development license as a result of this adjustment. When introducing the bill in Parliament, Minister for Petroleum KerengaKua stated that the purpose of the amendment Act to the Oil and Gas Act 1998 is to ensure that the state and the P'nyang gas project participants can execute a gas agreement similar to the one envisioned by the Heads of Agreement signed between the state and ExxonMobil on September 28, 2021. According to Mr Kua, this ensures that the P'nyang gas project would not be impacted by the Oil and Gas Amendment Act of 2020. “The Oil and Gas P’nyang LNG Project amendment bill 2021 only concerns the P’nyang LNG project alone and any application for a petroleum development licence for the P’nyang LNG project and not any other gas agreement or project or petroleum development licence in PNG. It confirms that, the changes brought about the 2020 amendments will not create any inconsistencies with the application process for the P’nyang LNG project for a Petroleum development licence which the project want us to have applied for in,” he said. Minister Kua noted that the application for the P'nyang field petroleum development licence was submitted prior to the 2020 changes, and transitional clauses did not take this into account, making the application for the P'nyang gas project subject to the 2020 amendments. “The gas agreement for the P’nyang gas project is anticipated to be concluded within December this year. Which will essentially include the broad terms which includes the preservation of the receipt in place prior to the 2020 amendments. It is important to note that the proposed amendment to the oil and gas amendment act will assist further negotiations and processing of application for the petroleum development license which is to follow.” he said. Reference: Post-Courier (3 December 2021). “P’nyang LNG Project Amendment Passed”.