Big four sign Papua LNG agreement

The National Business

TOTAL SA, the operator of the Papua LNG Project, ExxonMobil and Oil Search have signed an agreement with the Government defining the fiscal framework of the project.
Peter Botten, Oil Search’s managing director in a statement said: “We believe the fiscal and other terms of the gas agreement equitably allocate project benefits and returns to the State, the project participants and other stakeholders.
The agreement between the big four include:

  • A domestic market obligation which will provide gas for sustainable future domestic use. Oil Search is highly supportive of increased use of gas within PNG to assist in building local industry as well as the generation of power;
  • a deferred payment mechanism for the State’s payment of past costs, easing the financial burden associated with the State’s acquisition of its equity interest in the Papua LNG project;
  • A national content to support local workforce development, involvement of local businesses and socio-economic development of the communities impacted by the project.

Botten said the PRL-15 Joint Venture had reached alignment on a suite of agreements which would support the project taking the next step towards development, including those related to its site and facility access.
Meanwhile, the PNG Chamber of Mines and Petroleum has congratulated the Government and the project joint venture partners led by Total SA on the signing of the Gas Agreement yesterday.
Chamber executive director Dr Albert Mellam said it was a remarkable development for the LNG sector. “PNG continues to show potential for gas development, and reaching new markets globally,” he said.