Papua LNG Project

Production levy introduced for Papua LNG

Treasury Secretary Dairi Vele said this during a recent media conference.

The Treasurer also announced several other components of the fiscal terms of the Papua LNG Project which he said equal or are better than the PNG LNG Project.

“Production levy is just an extra tax, as it comes out of the ground, that’s where we tax you. Unlike the profitability of the company where we have to wait and see if the price is good and if the company has done good and if they paid their debts.

JV partners to carry State’s ‘sunk cost’

Money already spent, but that is not recoverable, is a sunk cost.

This will be repaid once first gas is produced at an interest rate of 7 percent.

Speaking after the signing of the Papua LNG Project Agreement, which defines the fiscal framework of the project, Prime Minister Peter O’Neill said an understanding has been has been reached with the JV partners for the deferment of the state ‘sunk cost’ for its equity in the project.

Papua LNG Agreement to be signed

Prime Minister Peter O’Neill made the announcement during day one of the 3rd Petroleum and Energy Summit in Port Moresby, which will end on Thursday.

The signing of the Project agreement paves way for Front End Engineering Design (FEED) and eventual construction.

The announcement by the Prime Minister follows the signing of the MOU in November of 2018 which provided a framework for key terms and conditions to be included within the Gas Agreement, including tax rates and domestic market obligation.

Progress on Papua LNG agreement

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.

PM confident in Papua LNG benefits

This is in addition to other benefits that the State will get through a National Content Plan and Domestic Market Obligation.

The Prime Minister said this in Parliament yesterday in its first sitting.

“I think we are aiming for very good benefits out of this particular project in terms of equity that we will fully participate in that. In terms of royalties, (and) domestic market obligation.

State signs MOU with Total, partners

This is to negotiate a gas agreement for the Papua LNG Project.

The signing took place this morning in Port Moresby before the opening of the APEC CEO Summit.

Present at the signing was Prime Minster Peter O’Neill, ExxonMobil PNG Managing Director, Andrew Barry, Oil Search Limited MD, Peter Botten and Total Chairman and CEO, Patrick Pouyanné.

The MOU signed today is another step closer to the realisation of the Papua LNG Project in the Gulf Province.

‘No pipeline policy’ a fallacy: Haiveta

The Governor has reaffirmed his position on the Papua LNG Project, saying it is economical for the planned pipeline to go ahead.

He has called on the group to take up their concerns with their elected leaders and not by pressuring them, which he says will not work.

He said his position on the project is for the economic benefit of the entire Gulf Province and not just the project impacted areas.

Second LNG likely to improve economy

Bank of South Pacific CEO, Robin Fleming, says the country’s economy is expected to face another 12 to 18 month slump. However, there is recognition by the business community that an improvement will be witnessed once the second LNG Train project is confirmed.

He said this was the general consensus following a shareholder board meeting in Lae last month.

Fleming said there remains a higher level of confidence in the project moving ahead by the end of 2018, following announcements during the recent inaugural Petroleum and Energy Summit in Port Moresby,

Oil Search re-assessing its activities

The company stated in its fourth quarter report that they are still generating positive cash flow even at the current depressed oil price.

Given that PNG LNG Project expansion and the Papua LNG Project are considered to be among the most commercially attractive new LNG projects globally, activities to progress these potential developments will continue to be prioritised.

Guidance on 2016 operating costs and capital expenditure will be provided in the 2015 full year results, scheduled to be announced on Few 23, 2016.