Papua New Guinea OKs LNG Project Agreement

January 2010 Vol. 237 No. 1

Houston-based InterOil Corp. announced Dec. 10 that the National Executive Council (NEC) of Papua New Guinea approved plans for construction of an LNG plant.

The project would be developed by InterOil and its joint venture partners, including foundation partner Pacific LNG Operations Ltd. The Government of Papua New Guinea, through its nominee Petromin PNG Holdings Limited, will have up to a 22.5% equity interest in the project.

The project targets a $7 billion two-train LNG facility with each train capable of producing 4 million tons of LNG per annum. While plans call for first production of LNG by early 2015, InterOil is progressing a proposed liquids stripping plant, to be located in Gulf Province, by early 2012, which would provide an attractive revenue stream to Papua New Guinea before the LNG project is expected to be completed.

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