China, Japan assured on LNG project

Business, Main Stories

The National

PUBLIC Enterprises Minister Arthur Somare has completed a “positively satisfying and successful” visit to Japan and China in connection with the PNG liquefied natural gas (LNG) project.
Mr Somare said upon his return: “Asian governments contracting for long-term purchases of liquefied natural gas wanted assurance that the PNG LNG project has the support of the PNG Government.”
He said they (Asian governments) are concerned about the role these imports would play in their respective economies over the next 30 years.
“The Chinese and Japanese governments believe that the strong commitment of the PNG Government is necessary to ensure smooth progress of the PNG LNG project,” Mr Somare said.
“We have been able to satisfy both governments on this score and to hold highly satisfactory meetings with prospective LNG customers that are in advanced sales negotiations with the project operator, ExxonMobil.”
Mr Somare travelled to Japan and China as a special envoy of Prime Minister Sir Michael Somare.
He was accompanied by four Members of Parliament, namely Anthony Nene (Sohe MP and Public Service vice-minister); Martin Aini (Kavieng); Jimmy Miringtoro (Central Bougainville) and Francis Potape (Komo-Margarima).
The PNG delegation held talks with head of China’s National Development Reform Commission (NDRC) chairman Zhang Ping.
NDRC is the premier government body that sanctions all international business transactions conducted by China’s state-owned corporations, including China Petroleum Corp (Sinopec).
Mr Somare also held talks with president of Sinopec Su Shulin, and expressed satisfaction that Sinopec and ExxonMobil had built a good working relationship during negotiations on a commercial agreement that needed the approval of the NDRC.
In Tokyo, the PNG delegation held high level talks with the vice-president of the Japan Bank for International Cooperation (JBIC), which was one of the major prospective financiers of the multi-billion dollar PNG LNG project.
JBIC has financed many LNG and other natural resources projects worldwide with total outstanding loans totalling more than US$71 billion (K195.6 billion) and project loan guarantees worth US$16 billion (K44 billion).
The PNG delegation also visited the Tokyo Power Electric Company (TEPCO) terminal in Japan that would receive LNG from PNG once exports started in late 2013 or early 2014.
“Exports of LNG will greatly cement bilateral ties with China and Japan by generating closer and more dynamic and economic and trading linkages.”
In Tokyo, Mr Somare and the PNG delegation also visited the site where early construction work has begun on the PNG Chancery building.