InterOil Corporation says Papua New Guinea's energy department plans to cancel approval for its 6 billion US dollar liquefied natural gas complex, but it says it's confident the project can be saved.
The National newspaper reports that the department asked the company last year to revise plans for the Gulf LNG project, which was slated to go on line in 2014, saying InterOil had deviated from the original agreement.
InterOil says the government has no right to end the agreement and that it has the support of Prime Minister Peter O'Neill.
It's Chief executive, Phil Mulacek, says PNG continues to have political flux as the country gets closer to the main election date.
The company says it has been in talks with the government since learning through an unofficial source that the Department of Petroleum and Energy planned to cancel the agreement, which was signed in 2009.