ExxonMobil has reportedly signed one or possibly two non-binding agreements with the state of Papua New Guinea with regards to the proposed P’nyang gas project.
PNG prime minister James Marape and a delegation of his ministers met ExxonMobil executives in Houston.
One or possibly two Heads of Agreement (HoA) were signed regarding the P’nyang Gas Agreement and regarding an additional equity stake in the project for the state of PNG.
The P’nyang Gas Agreement, which will outline the fiscal terms and conditions of the project, has not yet been negotiated.
As far as the additional equity is concerned, PNG sources have indicated the agreement will see the state offered an additional 10 percent interest by the existing joint venture on top of its 22.5 percent back-in entitlement.
An inquiry to confirm and elaborate on the agreements has been emailed to ExxonMobil in Houston. A PNG source said the HoAs are non-binding and set a framework for both sides to progress the upcoming negotiations.
“The project timing is sequenced in a way that P’nyang commences as soon as the Papua LNG construction is completed,” Marape said.
“This provides costs synergies which will (mean) certainty and opportunity to PNG businesses for a period of eight years of construction of the two projects.”
The joint venture owners of the P’nyang project are operator ExxonMobil and Oil Search each with 36.86 percent, Santos with 14.32 percent and JX Nippon with 11.96 percent.
The P’nyang field contains gross best estimate contingent resources of 4.4 trillion cubic feet of gas, according to Santos.
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