"We declare our first goal to be for every person to be dynamically involved in the process of freeing himself or herself from every form of domination or oppression so that each man or woman will have the opportunity to develop as a whole person in relationship with others".

- Papua New Guinea National Goals and Directive Principles

Monday, 10 September 2012

Papua New Guinea makes LNG project agreement pending

Source - TEX Report Limited

The United States InterOil Corporation, which has developed LNG production project in Papua New Guinea Gulf LNG Project, announced on August 29th 2012 that the government of Papua New Guinea decided to make the LNG Project Agreement pending. The government once notified its intention to cancel the project. The agreement was signed between Liquid Niugini Gas Limited, jointly owned by InterOil and Pacific LNG Operations Limited and PNG government.

 However, the government notified InterOil of its intention to cancel the project. Regarding this matter, InterOil, which was given a six month consultation period, has had constructive meetings with a number of PNG state departments and received confirmation from the Minister of Petroleum and Energy William Duma that the government has suspended its notice of intention to cancel the project.

The cancellation of the project was said to have been caused by the difference in the development plan between the government and InterOil. InterOil is scheduled to produce total 5 million tonnes per year of LNG, consisting of 3 million tonnes per annum at an onshore plant and 2 million tonnes per annum at an offshore plant. For the onshore plant, it is planned that Energy World Corporation's modular technology was adopted so that production could be expanded step by step.

On the other hand, the PNG government, which wants to have global scale LNG project, seems to be unsatisfied with such a project plan. It can be inferred that the reason why the government made its request to attract a world class project operator is because it is considered to be impossible to start up the desirable large-sized project with leadership of InterOil. InterOil claims that mutual agreement through discussion with the government could result in reviewing the cancellation of the project. In accordance with the intention of PNG government, InterOil is working on selection of the operator. Partly due to the promise with the government, Gulf LNG Project is likely to be significantly reviewed in the future.

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