Papua New Guinea's $13 Billion LNG Expansion Project Eminent
A mammoth natural gas project in Papua New Guinea, entailing expansion of production of liquefied natural gas (LNG) is now eminent after the government there agreed to set financial terms for the project by early 2019. That was reported some media on November 16, 2018.
According to the reports, a Memorandum of Understanding (MoU) was signed on November 15, 2018, by which the government committed itself to setting the terms by the above mentioned time, hence paving the way for the project to commence.
The cost of Papua New Guinea's LNG production expansion project is estimated to be $13 billion, and expected to double the country's LNG output. The project will be carried out by Total SA and Exxon Mobil.
LNG is the biggest contributor to Papua New Guinea's export earnings. However, like in many other countries, disputes about how revenues accruing from production of LNG should be shared among different interest groups like landowners, local communities, local governments, central government, and investors, have made often made negotiations in LNG projects complicated and time consuming. A previous LNG production deal in 2009, between the government of Papua New Guinea and Exxon Mobil is said to have financially favored the latter. As such, the government is reported to be determined to do better on this occasion!
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