PNG Gas The PNG Liquefied Natural Gas Project is a
project to develop linked gas fields in the Hela, Southern Highlands, and Western Provinces
of Papua New Guinea, and to construct a pipeline to the coast, and an export plant outside
Port Moresby. History
Originally, it was planned to transport the gas to Australia via 4,000 kilometres (2,500 mi)
long offshore pipeline. A subsidy of Chevron, South Pacific Pipeline initiated the project
in 1998 with an Environmental Impact Statement. The plan was to build a pipeline from Kutubu,
through Gobe and Kopi to Bamaga and then south to Gladstone in Queensland, where it was to
be connected with existing infrastructure. However, in January 2007 the connecting pipeline
project was suspended, mostly due to a lack of foundation load customers, and the project
partners started working on the current LNG project. On 22 May 2008, the Government of
Papua New Guinea and project consortium signed an agreement outlining fiscal and legal framework
for the project. Technical description
The two-train LNG plant will have capacity of 6.3 million tonne of LNG per annum. In
addition to the gas from the Hides field, potentially gas could be sourced also from
the Juha and Angore fields. The pre-FEED study was completed by the end of 2007. The decision
to proceed with the Front End Engineering Design (FEED) will be made at the end of March
or early April 2008. The FEED most likely would be prepared by KBR. The final investment
decisions should be made in 2009. The plant is expected to be commissioned by 2013 and
it is expected to cost US$9.5 billion, of which the development of the Hides, Juha and
Angore gas fields together with a pipeline to the coast may cost US$5 billion, while
the LNG plant could cost US$4.5 billion. Contractors
Engineering, Construction and Procurement (EPC) company Clough Curtain Joint Venture
(CCJV) was awarded the contract for liquefaction plant and upstream infrastructure work in
June 2009 and September 2010 respectively. In December 2009, EPC company Chiyoda JGC
Joint Venture (CJJV) was awarded the contract for the process plant. Honeywell was chosen
to be the Main Instrumentation and Control Contractor (MICC), responsible for providing
distributed control systems (DCS), safety, fire & gas and operator training simulation
(OTS) systems. Project company
The project is led by ExxonMobil, who will be also the operator of the plant and sell
the project's output on behalf of the owners. ExxonMobil owns 41.6% of participating interest.
Other partners of the project are Oil Search Limited (34.1%), Santos Ltd. (17.7%), AGL
Energy (3.6%), Nippon Oil (1.8%) and MRDC (a PNG company representing landowner interests
- 1.2%). Equities will change when the PNG State nominees join as equity participants
at a later date. AGL Energy is considering divesting its stake in the project as its
main interest was the gas pipeline to Australia, and not LNG.