Prime Minister Hon. James Marape has reaffirmed his government’s commitment to advancing the Papua LNG project, confirming that Final Investment Decision (FID) is expected by the end of 2025, paving the way for a new wave of economic growth in Papua New Guinea’s oil and gas sector.
Speaking at the launch of the NASFUND FM100 Talkback Show on Monday, the Prime Minister addressed recent delays, explaining that cost escalations had necessitated a review of engineering, procurement, and construction (EPC) contracts to align with financial expectations.
“The initial construction cost estimate for Papua LNG was US$12 billion, but tenders came back at US$18 billion, which has prompted the project developers to re-evaluate and optimise costs before proceeding to FID,” Prime Minister Marape explained.
He noted that TotalEnergies and ExxonMobil remain committed to progressing the project, as reaffirmed during his recent discussions with company executives at the World Economic Forum in Davos.
Once FID is announced, Papua LNG is expected to generate significant construction activity over the next six to seven years, creating employment opportunities, supporting local businesses, and boosting government revenues. The Prime Minister also confirmed that the P’nyang gas project will follow Papua LNG in sequence, extending the economic benefits of the petroleum sector for the next decade.
“Papua LNG will create a multi-year economic stimulus, driving investment in infrastructure and services. We are ensuring that P’nyang and other gas projects are carefully sequenced to sustain economic growth, employment, and business opportunities over an extended period.”
He encouraged Papua New Guinean businesses, SMEs, and workers to prepare for the opportunities arising from these large-scale investments.
Prime Minister Marape also highlighted strong economic fundamentals, revealing that foreign exchange reserves have surpassed US$4 billion, marking the highest level in PNG’s history. Additionally, forex supply is sufficient for 18 months, indicating a stable financial outlook.
“The growth of non-extractive sectors—particularly in agriculture, fisheries, and manufacturing—is starting to bear fruit, with non-resource sector growth exceeding 4% for the first time in our nation’s history,” he added.
The government remains committed to structural economic reforms, ensuring that the benefits of resource projects flow into other industries to drive diversified and sustainable economic growth.
In addition to Papua LNG, several major resource projects are moving towards development, including:
- Wafi-Golpu gold and copper project – Final agreements expected in 2025.
- Pasca A offshore gas project – Set to contribute to PNG’s LNG portfolio.
- P’nyang gas project – Following Papua LNG to ensure long-term energy sector expansion.
With an estimated US$20-25 billion in construction activity over the next decade, the government is ensuring that PNG is positioned for long-term prosperity.
Prime Minister Marape called on PNG businesses, SMEs, and local entrepreneurs to position themselves strategically to benefit from the upcoming investment boom.
“We are in a strong position for economic growth, and I encourage our financial institutions, superannuation funds, and private sector players to align with these developments. We must ensure that Papua New Guineans are at the forefront of these opportunities.”
The government will continue engaging with investors, development partners, and the business community to maintain momentum towards sustainable economic expansion as Papua New Guinea moves toward its 50th anniversary of independence.
