LPG gas price to reduce with new project

The cost of liquefied petroleum gas (LPG) in the country is expected to be significantly reduced if the Pasca A4 Offshore Gas Field is developed.

With discussions for a ‘Domestic Market Obligation (DMO)’ agreement between the Government and developer, Twinza Oil Limited, the cost of fuel sources such as LPG can be significantly reduced.

Twinza managing director, Huw Evans, says the company is committed to the DMO of which the gas resource are injected back into the domestic market.

With the country having an existing refinery at Napanapa, owned by Puma Energy that produces and sells LPG, this could further drop fuel prices.

“We’re committed to doing it. We’d like to work with organisations that are keen to build up that infrastructure and I think we can reduce the cost of purchase of that for both wholesale and retail market which will be beneficial for everybody,” he said.

Evans said apart from the Napanapa Refinery, the country also imports LPG from Saudi Arabia.

He added Twinza can be competitive in this area however, storage and distribution are major hurdles.

“It’s obvious we’ve got domestic storage and supply that we can be very competitive with those sources.

“The challenge with LPG is storage and distribution cost. And With PNG you have to distribute to the Highlands and Islands centres it is quite difficult. But we should be ready to do this quite readily,” Evans said.

Twinza is currently looking into a strategic location to establish the LPG facilities to best benefit the country.

Cedric Patjole