The National Executive Council has approved the Draft PNG Natural Gas Policy White Paper.
The Draft policy will guide the development and management of the country’s growing oil and gas industry to be competitive in the world market while at the same time derive more benefits at the domestic sector.
In a statement Petroleum Minister, Fabian Pok, said developments in the gas portfolio have created many challenges on how to manage them.
The challenges include policy, legal and institutional frameworks. Others include the development of natural gas infrastructure, formulation of relevant policies on domestic market obligation and managing export market, local content, third party access regime for the gas pipeline, gas revenue management and health, safety and environment protection.
Minister Pok said in order to maximise the benefits accrued from the natural gas resource, the implementation of these policies will align with PNG’s long term development strategies and goals.
The NEC decision now directs the Department of Petroleum to take the lead in proceeding to meet with relevant stakeholders to finalise the policies, which have been discussed for some time.
The NEC decision has directed that the process of developing the Domestic Market Obligation (DMO), Third Party Access (TPA) and Local Content (LoC) start immediately.
“This is a critical government policy initiative and we recognise that beyond the economic rent, there are broader strategic benefits to the economy that will be attained from the domestic utilisation and value adding to natural gas.”
He reiterated the government’s position that all new gas projects, including the P’nyang project, will be negotiated under the terms provided for in the new Policy.
Dr Pok recently said at the 2018 Petroleum and Energy Summit in Port Moresby, the Natural Gas White Paper and its supplementary policies entail the inspirations and developing lessons learnt from the recently established and producing PNG LNG project.
The Minister said Cabinet has directed also that the draft policy be further developed as this draft policy, when finally approved and ratified, will mark a new era in PNG as a regional leading natural gas producer.
“This White Paper is the first step in the important process to reform PNG’s natural gas policies. It sets out the PNG Government’s vision and plans for implementing the necessary policies and legislative framework to match international best practice in order to support PNG’s economic development and prosperity.”