17 Dec 2010

Possibility of more PNG gas reserves could underpin future LNG projects,

11:23 am on 17 December 2010

Industry analysts say that Papua New Guinea's Hides gas area may contain 50 percent additional deposits compared with currently booked reserves.

Bloomberg reports sell-side research team Bernstein as claiming that Exxon Mobil's liquefied natural gas project in PNG could add a third production line because of the possibility of finding more natural gas.

Exxon and Oil Search Ltd. plan to produce 6.6 million metric tons a year of the frozen fuel in 2014 from two production lines at the LNG venture.

Analysts say the main trunk-line for PNG LNG has the capacity to accommodate a third and possibly fourth LNG train at a low cost, making the marginal return on LNG expansion extremely attractive.

Bernstein says PNG remains under-explored and under-appraised, and the possibility of multi-trillion cubic feet discoveries remains high.