Thursday, May 10, 2012

DPE: InterOil’s Gulf LNG project rejected

The Department of Petroleum and Energy insists that InterOil’s controversial Gulf LNG project has been rejected by the government, and the company must respect that decision, The National reports.
Department secretary Rendle Rimua said that last year, the National Executive Council (NEC) rejected the Gulf LNG project primarily because Liquid Niugini Gas Ltd/Interoil deviated from the project concept that was agreed to with the State in the 2009Project Agreement.
A copy of Rimua’s statement was sent to InterOil on Tuesday for comment, however, the company had not responded by yesterday.

Rimua said the project was rejected as LNGL/Interoil did not:

• Formally seek and get approval from the state to change the scope and concept of the project;

• Find an internationally-recognised reputable LNG operator;

• Produce a proposal consistent with the project agreement; and

• Prove the proposed technologies were proven in the context of processing large amounts of LNG.

“During that time, Interoil released information on many occasions that they had completed the front end engineering and design (FEED) when the process of lodging applications for relevant licences had not been done yet,” Rimua said.
“They continued to promote the ‘Gulf LNG Project’ concept when they were advised on numerous occasions the concept was not the agreed concept in the 2009 Project Agreement.
“Recently, Interoil came out public stating that FEED was still in progress and the government had not rejected the ‘Gulf LNG Project’ concept.
“This is factually misleading.
Rimua said the department is aware that the FEED for the condensate stripping programme is complete “but we are not aware on the status of the FEED for the whole project”.
“The department has not even discussed or reviewed the FEED documents in detail with LNGL/Interoil as none have been lodged with the department,” he said.
“The department is also amazed that LNGL/Interoil states that the ‘Gulf LNG project’ has not been rejected even when the Minister for Petroleum and Energy publicly stated on various occasions that it was rejected by the NEC.”

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