Monday, February 09, 2009

Governmentt will know LNG project status by September


THE Government should know by September whether or not it has secured the US$12 billion (K34 billion) liquefied natural gas project, according to Deputy Prime Minister and Minister for Lands and Mining Dr Puka Temu.

In-country, relevant Government agencies were finalising the benefits sharing arrangements with the project’s stakeholders to ensure everyone knows and is aware of the arrangements before the project is finalised while, externally, project operator Esso Highlands Limited is negotiating market arrangements.

PNG is targeting the Asian market particularly the Japanese, Korean, Chinese and Indian markets, where the development requirement for energy is very high and expects to sell it at a premium price.

“What we are doing right now is sitting down with the landowners to arrange benefit sharing arrangements so that landowners are part and parcel of this big project in the country,” Dr Temu told a large crowd of people in Buka last Friday.

“We are also, through our joint venture partners around the world led by ExxonMobil, negotiating markets and are going to lock them in for 30 years,” he said.

“Once we secure the project in September, the first shipment will leave our shores in 2014 for Japan.

“That means by 2025, our 50th Independence anniversary, PNG will be close to doubling or even tripling its GDP.

“That means that we will have more money in our system to move the nation forward and become one of the best developed nations in the world,” he said.

Dr Temu also told the people of Bougainville that the Government had secured its K1.2 billion equity in the project and was waiting for the rest of the project partners – Esso (32.9%), Oil Search Limited (28.7%), Santos Limited (13.7%), AGL Energy Limited (3.6%) and Nippon Oil Exploration Limited (1.7%) – to secure theirs.

Two weeks ago, representatives of some of the world’s export credit agencies came to the country on a due diligence visit, to see whether they would support the LNG project, whether politics in Papua New Guinea was stable, whether landowners would support the project and whether there was anything they could learn.

He said the Government was confident that these visitors had left satisfied.


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