Papua New Guinea resumes talks with Exxon on gas field agreement

Papua New Guinea resumes talks with Exxon on gas field agreement

The government of Papua New Guinea and US oil giant Exxon Mobil Corp plan to resume talks on the P’nyang natural gas project, nearly two years after negotiations broke down , Oil Search Ltd, a partner on the project, said Monday. 

In November 2019, talks linked to a $ 13 billion expansion of the country’s liquefied natural gas (LNG) exports fell apart with the government saying Exxon was unwilling to negotiate on the country’s terms.

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The government has lobbied for better returns for the impoverished country than those achieved in the original PNG LNG deal in 2008.

Exxon’s spokesperson in PNG was not immediately available for comment.

The talks focused on the development of the P’nyang gas field. Exxon and its partners, including Oil Search, intended to develop P’nyang to power a new processing unit, or train, at the PNG’s two-train LNG facility.

However, since the talks have failed, thinking has shifted to developing P’nyang further down the track to power existing trains as current gas sources run out, rather than expanding LNG PNG, it has previously stated Oil Search.

PNG oil minister KerengaKua said on Monday that hopefully, “we can expect to sign an agreement on the leaders of P’nyang towards the end of next month and a gas agreement thereafter.”

“We look forward to further progress in these negotiations and will support (Exxon) through our 38.51 per cent stake in the joint venture,” said Diego Fettweis, executive vice president of commercial oil Search.

Its stake in PNG LNG is considered to be the flagship of Oil Search, which has accepted an offer to acquire all shares from Santos Ltd worth approximately A $ 8 billion (US $ 6 billion) in a deal that would create a top -20 global oil and gas company. to know more.

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