Good progress has been made on finalising the more detailed gas agreement on the Papua LNG Project since the signing on the Memorandum of Understanding in November last year.
Oil Search Managing Director, Peter Botten, said progress has been made on finalising the detailed agreement based on the structure established in the MoU.
The MoU provides the framework for key terms and conditions to be included within the Papua LNG Project Gas Agreement, including the tax rates and Domestic Market Obligation that will apply.
Botten said this in the company’s fourth quarter report for 2018.
Botten said well-defined plans are in place to complete and sign the full gas agreement, with all parties aiming for this to occur no later than 31 March 2019, in line with the MoU timeline.
He said while the key focus during the quarter was on the Papua LNG Agreement, the P’nyang (PRL 3) Gas Agreement is also targeted to be finalised before the end of March.
This will enable an integrated FEED entry decision to be made on the proposed three-train expansion at the PNG LNG plant site shortly afterwards.
During the quarter, the commercial arrangements that support the integration of the Papua LNG Project with the PNG LNG Project, including those related to site and facility access, were broadly agreed between the PNG LNG Project and Papua LNG (PRL 15) joint venture.
In addition, pre-FEED downstream studies continued, including engineering work on the design and process and layout optimisation of the three-train development concept, from the gas inlet to the LNG loading arm.
The PNG LNG, Papua LNG and P’nyang participants continue to meet regularly to discuss contracting strategies and are making good progress on project financing and the remaining agreements required to enable integration of the projects.
(After the MOU signing on November 16th, 2018)