Botten: State expected to foot 22pc of project’s cost

The National Main Stories

By MARK HAIHUIE
THE Government is expected to contribute 22.5 per cent of the total cost of construction of the Papua LNG Project, says Oil Search managing director Peter Botten, pictured.
The cost is estimated to be about US$19 billion (K60.52 billion).
Botten said yesterday the Government had the right to support 22.5 per cent of the expansion and the development project.
“I would anticipate that is what they will look to do,” Botten said.
“I think the size and shape of the project, and the attractiveness of the economics, will drive the means for financing their stake.
“I am sure they will maximise their equity position given the long-term attractiveness of this project.”
Botten expects a “strong unified commitment” from ExxonMobil and Total despite both having ongoing operations elsewhere.
“Based on discussions that we have had over the last month (with both parties), there is a very strong unified commitment to move this project forward in a timely way,” he said.
“I think the development concept is one that is strongly supported by both these parties.
“I know they will have other interests around the world. But in no way do I see any reluctance to move this project forward.”
Botten said key objectives for the LNG expansion in 2018 included:

  • Completing negotiation of cost-sharing and integration agreements between PRL 15, PRL 3 and PNG LNG joint ventures;
  • negotiating gas agreements for LNG expansion volumes with the Government;
  • starting equity marketing of Oil Search’s share of expansion LNG; and,
  • Making a decision on front-end engineering and design.