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TotalEnergies has a 37.55 percent operating stake in the Papua LNG project, US-based ExxonMobil has 37.04 percent, Australia’s Santos owns a 22.83 percent interest, and Japan’s JX Nippon holds 2.58 percent.
The project calls for the design of about 4 million tonnes per year of liquefaction capacity adjacent to the existing PNG LNG processing facilities, operated by ExxonMobil and located 20 kilometers northwest of Port Moresby, Papua New Guinea,
The facility will receives supplies from the Elk-Antelope gas field.
Also, the project includes the use of 2 million tonnes per year of liquefaction capacity in the existing trains of PNG LNG.
Asked about the Papua LNG project during the Santos H1 earnings call on Wednesday, Gallager said “we’re working with the joint venture partners on Papua to reset the FEED phase of the project.”
“And the best estimate I would give you right now is that the joint venture will be looking to line up an FID decision towards the end of 2025. So that’s pushed out from the original plan which would have been end of this year. And so end of 2025 for FID,” he said.
Discussing the preferred development concept for the LNG project, he said the concept at this point is “largely the same.”
“There are optimizations, design optimizations that we’re working with the joint venture to reduce the CapEx of the project,” Gallagher said.
“But effectively, the 2 million tonnes aspect is the same. And so you can count on that. And everything just slips a little bit on the long-term supply plan,” he said.
“High interest” from LNG buyers
In April this year, TotalEnergies said in a statement that the Papua LNG FID was postponed to 2025.
This was revealed during a meeting between Patrick Pouyanne, chairman and CEO of TotalEnergies, and James Marape, the Prime Minister of Papua New Guinea.
Pouyanne reaffirmed that TotalEnergies, operator of the project, and its international partners ExxonMobil, Santos, JX Nippon, are “fully committed” to Papua LNG.
“In particular, he shared the high interest of several LNG buyers for off-taking LNG from Papua LNG due to its strategic location close to key Asian markets,” he said.
Pouyanne also said that, after receiving first EPC offers, it appears that the project “will need to keep working with contractors to obtain commercially viable EPC contracts and requires more work to reach FID.”
“In that view, the project will review the structure of some packages and open the competition to an enlarged panel of Asian contractors. As a consequence, FID of Papua LNG project is now expected in 2025,” the statement said.
Pouyanne and Marape “agreed that this slight delay will not affect the early works planned in Papua New Guinea in 2024 and that the project will maintain its full support to local population of Gulf Province,” the statement said.
In March 2023, the Papua LNG partners launched fully-integrated front-end engineering and design (FEED) for the project, while TotalEnergies sold a small stake in the project to Japan’s JX Nippon Oil & Gas Exploration in June.
Pouyanne said in September last year the project partners could take a final investment decision on the project “by the end of this year or beginning of the next year.”