Negotiation hiccups cause delay

By SHIRLEY MAULUDU
THE delay in progressing discussions on the P’nyang gas project in Western is because the State and project operator ExxonMobil PNG Ltd and partners have not agreed on the initial terms of the project.
Petroleum and Energy Minister Kerenga Kua said this noting that the state had pushed for more benefits from the project to be catered in the proposed gas agreement.
“Negotiations started last Nov 15,” he told a media conference yesterday.
“After about five weeks, the negotiations collapsed because Exxon, negotiating on behalf of the joint venture partners, and the state negotiating team headed by chairman Isaac Lupari could not reach an agreement on the terms and conditions of the proposed gas agreement.
“But then, the State has continued interest to see the project come off the ground if we can be able to secure common ground on the terms and conditions between the state and the developers.
“So the prime minister (James Marape) then, at the end of December last year, called up the key players that included ExxonMobil, Total and Oil Search, and myself to a meeting where he observed that the parties have not been able to reach an agreement, but he said that we must reactivate negotiations.
“At that point, he directed me to reduce the demands that we have been making on behalf of the state.
“He (Marape) said you are too far up there so you have to come down in order to try to see if you could encourage a deal to be made.
“At the same time, he turned to ExxonMobil and said you also have to demonstrate good will.
“So, subsequent to that, I have re-tasked the state negotiating team.
“We have found a new lower level at which the state will accept the deal and the negotiations have been rescheduled to recommence,”
“In addition to the direction to come down a little bit, the Prime Minister also directed that in the reactivated negotiation, the deadline is Jan 31.”