Energy Minister hails global interest in big PNG gas projects

Transcript

Papua New Guinea's Petroleum and Energy Minister says the development of a third major Liquefied Natural Gas project underlines PNG's status as a major global energy player.

William Duma says he is pleased at the recent alliance between Australian company Horizon Oil and Japan's Osaka Gas to develop a series of large discoveries in Western Province.

Mr Duma told Johnny Blades the entry of Japan's second largest gas company as investor and strategic partner to Horizon reflects the growth of Japanese interest in PNG.

WILLIAM DUMA: There's been a marked increase in the level of Japanese interest in our resources the last couple of months, and we are quite pleased. Osaka Gas happens to be one of those very big LNG companies who has now made a decision to work together with Horizon to develop the Stanley Gas Project. They have quite an interest in some of those licences held by Horizon, also. We're pretty pleased about that.

JOHNNY BLADES: Will it be another process to get landowner agreements on board?

WD: Yep. Compared to the Kokopo Agreement. You must remember we were dealing with landowners from three different provinces - the Southern Highlands, Hela, Gulf and, of course, the Central province where the plant facilities are. There are four different provinces involving many different ethnic groups, whereas in both the InterOil project, as well as the Horizon and Osaka Gas-led project, they all involve one single ethnic group, one common language, and one province, so it'll be easier compared to the Exxon Mobil-led project.

JB: And last time I spoke to you, you voiced concern about the approach that InterOil was taking to develop that second LNG development. But now it looks like they're perhaps teaming up with Exxon, is that correct?

WD: That's what they're telling us, but as to the terms of this arrangement, we have not been informed of the precise terms. So when we do receive formal advice from InterOil, we will then run it through the existing 2009 Project Agreement we have with InterOil and see whether the proposed arrangement with Exxon Mobil meets the requirements of the 2009 agreement. Then there are the associated issues of competition, of course, that need to be looked at carefully. As a country, there is some concern from sections of the community that it may not be a wise thing to allow one major energy company to dominate the industry and the country. So there have already some concerns expressed by some influential sections of the community. So we are also mindful of that. So now we'll reserve our comments until we receive the advice from InterOil about this arrangement that they're talking about with Exxon Mobil.