AUSSIE COMMISSION APPROVES PNG GAS MARKETING

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PORT MORESBY, Papua New Guinea (The National, May 9) – The Australian competition and consumer commission authorized the joint marketing of gas from the proposed Papua New Guinea gas project in Australia.

ExxonMobil, Oil Search Group, the Mineral Resources Development Company, the Merlin Petroleum Company and AGL Gas Developments have to agree on common terms and conditions, including price, at which they will offer gas for sale to potential customers for 16 years.

[PIR Editor's note: According to PIR news files, the Australian Consumer and Competition Commission proposed in a draft determination that it was considering granting joint marketing rights to the Papua New Guinea gas project for just 16 of its 30-year lifespan. The Papua New Guinea government sealed a deal last February to finance its 22.5 percent stake in the planned Papua New Guinea-Queensland gas pipeline with US$480 million in funding to come from the Japan Bank for International Cooperation.]

Commission boss Ed Willett said in a statement yesterday that the project was a joint venture enterprise and involves the production and sale of Papua New Guinea gas to customers in Australia.

Gas sales in Australia are expected to start in 2009 following the construction of a Papua New Guinea to Queensland pipeline.

The initial capital costs of the project are likely to be in the order of AUD$4 billion [US$3 billion] and the capability of the project could be as high as 300PJ [petajoules] an annum.

[PIR Editor's note: Petajoules are units of energy.]

"The project will bring a new source of gas supply to eastern Australia and with it substantial public benefits," Willett said.

May 10, 2006

The National: www.thenational.com.pg/

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