Resource development partners disappointed with outcome

DEVELOPMENT partners in the P’nyang gas project in Western are disappointed with the outcome of the gas deal talks that concluded last Friday.
A spokesperson from ExxonMobil PNG Ltd told The National: “We are disappointed we were unable to reach an agreement.
“We are hopeful that we can continue to work toward an outcome that benefits all stakeholders.
“We are proud of our partnership with the people of Papua New Guinea and have worked to create lasting benefits for the country, including our commitment to energy development, as operator of the US$19 billion (K64.6bil) PNG LNG Project, which provides employment for more than 3,200 people.”
Oil Search managing director Peter Botten said the company was disappointed with the statement released by Prime Minister James Marape on Friday, which stated that negotiations on the P’nyang gas agreement had stopped, to allow the Government to concentrate on developments already in the pipeline.
“Oil Search respects the Government’s right to set fiscal terms for resources developments in PNG, to ensure the State, resource owners and the people receive an appropriate share of value from these projects,” he said in a statement.
“Oil Search is very committed to getting the correct balance, ensuring appropriate benefits are distributed to the right stakeholders.
“This ensures the long term operating stability for any development, as well as being the right thing to do.”
However, Botten highlighted that the resource size, cost of development and challenges of operating in PNG were very different to other countries.
He said, therefore, making broad comparisons with other fiscal regimes in the region was “misleading”.
“A series of negotiations regarding the terms of the P’nyang gas agreement have taken place over the last months
“It is unfortunate that, at this time, the stakeholders in P’nyang cannot agree on the appropriate balance of value and benefits for a gas agreement to be concluded. Under the terms proposed by the State, the joint venture partners were unable to obtain a return on their investment that made the project investable.”