Photo Credit: Oil Search
Businesses are waiting for clear answers from the government on when resource projects like Papua LNG and the Pasca A offshore oil and gas project will be operational.
According to Rio Fiocco, head of the Port Moresby Chamber of Commerce and Industry, there had been rumors of agreements being signed or close to being completed, but companies required a firm decision on when construction would begin.
He claimed the projects will boost business confidence, particularly Papua LNG, by creating spinoff enterprises for locals, in accordance with the government's national content goal.
According to industry sources, the government recently stated during a PNG Chamber and Mining workshop last week that it intended to make announcements on pending projects by September 16.
During the workshop, Secretary of the Department of Petroleum and Energy David Manau stated that an agreement for the Pasca A project in Gulf was expected in the following two weeks.
“For Pasca, we have completed all the negotiations and the agreements are in its draft stage,” he said.
“As of last night (last Tuesday), in a briefing with the Prime Minister James Marape, the State negotiating team (SNT) was given until next week (this week) to sit with Twinza and complete the gas agreement for a possible NEC (National Executive Council) announcement the following week.”
In February, the state and the project's developer, Total E&P PNG Ltd, inked a fiscal stability agreement for the Papua LNG project.
The front-end-engineering-design (Feed) stage of the US$12 billion (K41.28 billion) Papua LNG project is expected to take two years, with the actual construction taking four years.
The economic advantages of the projects, according to managing director Jean-Marc Noiray, will be realized following the building period.
“We need to embark on the whole stabilisation of the project which we call the pre-Feed,” Noiray said.
“We are working hard on that.
“The Feed itself will last between 15 and 18 months, from the moment we reach the final investment decision.
“And from the final investment decision to first gas, we have about four years of construction. It’s a long journey before we get to the first gas and the first revenues.”
Reference: Luma, Dale. The National (10 August 2021). “Businesses waiting on Govt”.
