Papua New Guinea (PNG) continues to have vast opportunities laid down in front of it especially in the Asian gas market, and with the focus of the world now shifting to greener energy, the potential to gain revenue from Liquefied Natural Gas (LNG) is even greater.
Minister for Petroleum and Energy Kerenga Kua, who spoke on behalf of the prime minister this morning at the official opening of the PNG Energy Summit & Exposition 2022, said major projects in the energy sector lined up for commencement should see the country tap more into this potential.
He said the future of the country’s development of petroleum resources looks good with Total Energy announcing its Final Investment Decision (FID) for the Papua LNG project in July this year.
“This will almost double PNG’s exports of LNG from the current 8.5million tonnes per annum (MTPA) to 14 to 15MTPA,” said the minister.
He added that Papua LNG is likely to reach final investment decision late 2023 and with a four-year construction phase, the first LNG export is expected around 2027 or early 2028.
“This will be followed by FID and construction of P’nyang Gas project, planned for delivery of a further 2 to 3million tonnes per annum of LNG by 2032.”
He said this is important because of what these LNG projects can bring into the country.
“These LNG projects have direct and indirect benefits for the country by providing revenue to national, provincial, and local level governments.
They provide employment during their construction and operations, which also generate spinoffs service contracts to local companies and SMEs.
He added that these projects will allow developers to put a per centage of their gas for Domestic Market Obligation (DMO) to be used within the country for power generations and other purposes, such as fertilizers and industrial chemical productions.
In addition to this, PNG’s LNG supplies to the world market is projected to further generate revenue with the demands increasing due to geopolitical circumstances.
This was highlighted by the Executive Vice Chairman and Managing Director for FGE, Mr. Shasha Fesharaki. Mr. Fesharaki echoed the minister by saying that the upcoming projects in PNG should see more generation of revenue due to the demand of gas increasing in the European market and the traditional Asian market.
He added that the outlook is healthy projected from demands and productions of LNG around the world and with additional LNG supplies lined up for PNG, the prospects look good.
“If you have new LNG supplies in the next couple of years, its like gold,” said Mr. Fesharaki.
“PNG LNG is well positioned to extract in significant revenue in the near term with uncommitted volumes due to some expiring contracts, so if you have volume on hand, its like gold and PNG will benefit tremendously from the market situation by having these volumes around one and a half and two million tonnes over the next couple of years.”
Meanwhile, the PNG Energy Summit & Exposition 2022 will continue for its second day today and the final day on Thursday 22nd September, the delegation will be given a full tour of the PNG LNG plant site, just outside Port Moresby city.