Firms vie for Papua New Guinea LNG plant contract

Bechtel and Chiyoda are short-listed to bid on the EPC contract for the ExxonMobil-operated Papua New Guinea LNG plant and facilities.

Eric Watkins
Oil Diplomacy Editor

LOS ANGELES, Oct. 21 -- Bechtel and Chiyoda Corp. are short-listed to bid on the engineering, procurement, and construction (EPC) contract for the ExxonMobil Corp.-operated Papua New Guinea LNG plant and facilities.

Either Bechtel or Chiyoda eventually will build the plant, which includes the facilities for inlet processing, treating, liquefaction, storage, and loading of 6.3 million tonnes/year of LNG.

"ExxonMobil is pleased to have the first phase of the LNG plant [front-end engineering and design] completed, and we look forward to a successful tendering process leading to the downstream EPC contract," said Peter Graham, ExxonMobil development company venture manager.

The project operator expects to formally award the EPC contract by late next year with the successful bidder expected to start construction in 2010.

Gas from Hides, Angore, and Juha fields and associated gas from currently operating Kutubu, Agogo, Gobe, and Moran oil fields in Papua New Guinea's Southern Highlands will be conditioned and transported more than 700 km to the LNG plant near Port Moresby.

In September, the LNG consortium said it may acquire 2-4 ships to transport the LNG from the Papua New Guinea terminal when it starts up in late 2013 or early 2014.

Jeff Appleton, the Papua New Guinea LNG vice-president for marketing, said the firm is looking at ships with a maximum storage capacity of 220,000 cu m and might acquire either new or existing vessels or could lease them.

Appleton said Papua New Guinea LNG would like to prequalify the shipyards and shipowners by yearend and issue the EPC tender next year. He said the exact number of vessels and their capacities will depend on the location of the company's customers.

The LNG project consortium includes ExxonMobil's Esso Highlands Ltd. 41.5%, Oil Search 34%, Santos 17.7%, AGL 3.6%, Nippon Oil 1.8%, MRDC 1.2%, and Petromin PNG Holdings' Eda Oil 0.2%.

Contact Eric Watkins at hippalus@yahoo.com.

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