LNG project almost complete

 THE LNG project is more than 90% complete with project cost unchanged from the 2012 estimate of US$19 billion (K43.77 billion), project joint venture partners announced yesterday.

Project operators Esso Highlands, Oil Search Ltd and Santos also said the Antonov cargo delivery operations into Komo Airport was completed on  Aug 13 and installation of equipment delivered from Komo to the Hides gas conditioning plant was underway.

Esso Highlands said the project is on schedule for first delivery of liquefied natural gas (LNG) during the second half of next year.

“With more than 19,000 people currently working across the project, including more than 7,500 Papua New Guineans, we are making significant progress,” Decie Autin, PNG LNG project executive said in a statement.

“We have started the commissioning phase at the LNG plant in preparation for the first LNG production in 2014. 

“This includes sending gas from Oil Search’s Kutubu central processing facility to the LNG plant to provide power and enable testing and commissioning of key facilities and equipment.

“Drilling at Wellpad B is complete and the drilling rig is being moved to the next wellpad to support further drilling activity,” Autin said.

Estimated cost of the project remains at US$19 billion, excluding Port Moresby administration facilities and shipping.

“ExxonMobil successfully develops projects around the world under a broad range of technical, operational and financial conditions,” Autin said. 

“The project has been able to maintain its schedule in PNG under unique and challenging circumstances. 

“Our focus on disciplined project execution has allowed us to meet our scheduling commitments without further cost increases.”

Peter Botten, Oil Search’s managing director said: “As highlighted in our recent 2013 half-year results release, the PNG LNG Project is progressing well and is now more than 90% complete. 

“While considerable work remains to be completed before first LNG sales, this is an important step for the project and I would like to congratulate Esso Highlands and all the Oil Search staff and contractors who have contributed to the start-up of commissioning gas.”

Santos chief executive David Knox said the significant progress made at PNG LNG was pleasing and all co-venturers were looking forward to the first LNG cargo next year.

“Santos continues to make strong progress on our two major growth projects PNG LNG and Gladstone LNG, both of which remain on schedule and whose capital cost estimates remain unchanged,” Knox said.

Santos has a 13.5% interest in PNG LNG.