Warren R. True
Chief Technology Editor-LNG/Gas Processing
HOUSTON, Dec. 8 -- ExxonMobil Corp. and partners will proceed with development of the Papua New Guinea LNG project, according to an announcement late Dec. 7. Those plans depend, however, upon completion of sales and purchase agreements with LNG buyers and of financing arrangements.
Tokyo Electric Power Co. also announced Dec. 7 it has contracted for 1.8 million tonnes/year from the project. And last month, the ExxonMobil-led joint venture signed heads of agreement to supply Unipec Asia, a Sinopec unit, with 2 million tpy of LNG (OGJ Online, Nov. 5, 2009).
The integrated project—estimated to cost $15 billion—includes gas production and processing, onshore and offshore pipelines, and two LNG trains near Port Moresby with total liquefaction capacity of 6.6 million tonnes/year. Reserves behind the project are estimated at more than 4 tcf in Hides, Angore, Juha, Gobe, Moran, and Kutubu fields in the Southern Highlands of Papua New Guinea (OGJ, Aug. 10, 2009, p. 38).
Participating interests include affiliates of ExxonMobil (including Esso Highlands Ltd., operator, 33.2%), Oil Search Ltd. (29%), Independent Public Business Corp. (PNG government, 16.6%), Santos Ltd. (13.5%), Nippon Oil Exploration (4.7%), Mineral Resources Development Co. (PNG landowners, 2.8%), and Petromin PNG Holdings Ltd. (0.2%).
Peter Graham, managing director of Esso Highlands Ltd., commented Dec. 7 that other pending sales contracts would likely be completed early next year.
Neil Duffin, president of ExxonMobil Development Co., said “With global demand for LNG forecast to nearly triple by 2030, the PNG LNG project will be an important supply source to meet this future demand, particularly for the economies in the fast growing Asia Pacific region.”
LNG demand growth
ExxonMobil said in its PNG LNG announcement that global LNG demand will grow by about 4%/year through 2030, when LNG will meet about 15% of the world’s gas demand.
In what was likely not coincidental, Tom Walters, president of ExxonMobil Gas & Power Marketing Co., told attendees Dec. 7 at the International Petroleum Technology Conference in Doha that large-scale LNG projects “will be necessary to meet increasing global demand for natural gas.”
ExxonMobil expects global energy demand to grow to more than 300 million boe/d from about 230 million boe/d in 2005, “an increase of almost 35%,” he said.
Global growing demand for gas will require “our industry to deliver projects on a scale that was barely considered even a decade ago.” he said. “The ability to conceptualize, commercialize and execute large-scale, multibillion dollar projects has become an increasingly important differentiator, which will remain over the coming decades.”
Contact Warren R. True at [email protected].
