Chevron presses for Papua New Guinea-Queensland gas line

Chevron Corp., San Francisco, on Monday said its vice-chairman, Richard Matzke, will meet with the prime minister of Papua New Guinea, Mekere Morauta, on May 13 to discuss progress in launching a project to lay a proposed natural gas pipeline from Papua New Guinea to Australia. The $3.5 billion (Aus.) project will extend about 3,000 km across the Coral Sea. It is awaiting commercial and environmental clearances from the governments of Papua New Guinea, Australia, and Queensland.


Chevron Corp., San Francisco, on Monday said its vice-chairman, Richard Matzke, will meet with the prime minister of Papua New Guinea, Mekere Morauta, on May 13 to discuss progress in launching a project to lay a natural gas pipeline from Papua New Guinea to Australia.

The $3.5 billion (Aus.) project will extend about 3,000 km across the Coral Sea, bringing gas from Papua New Guinea to the Australian state of Queensland. It is awaiting commercial and environmental clearances from the governments of Papua New Guinea, Australia, and Queensland.

John Powell, project head for Chevron, said the meeting is designed to send a message to the Papua New Guinea leader "that it is not just the [Papua New Guinea] government that's part of the stakeholder activity."

Other project partners include ExxonMobil Corp. and Australian firms Oil Search Ltd. and Orogen Minerals Ltd.

A number of local and international companies have agreed to provide up to 600 MMscfd of gas from Papua New Guinea's Hides, Kutubu, Gobe, and Moran fields for 30 years (OGJ, May 8, 2000, Newsletter). But the project's timetable for development has slipped as backers await commercial commitments from Australian gas consumers. Project participants also are awaiting the release of a clean energy strategy from the Queensland government before finalizing contracts with customers.

Morauta has made the pipeline project's development a top priority in order to bring foreign investment into the impoverished nation. Based on options agreements held by Orogen Minerals, Papua New Guinea could eventually control about 23% of the project's gas reserves.

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