TotalEnergies, the global energy giant, has assured Papua New Guinea of its commitment to its ambitious Papua LNG project.
The oil major confirmed that the project remains on track for a Final Investment Decision (FID) next year, with the first liquefied natural gas (LNG) production anticipated between 2027 and 2028.
In a meeting held in France, PNG Prime Minister James Marape met with TotalEnergies' CEO, Mr. Pouyanne, who reaffirmed the commitment to the US$12 billion Papua LNG Project. Mr. Pouyanne expressed confidence that the project would proceed with construction commencing in the following year post-FID. This development is expected to have a substantial positive impact on Papua New Guinea's economy.
"Mr. Pouyanne assured me that the US$12 billion Papua LNG Project is on course to commence construction next year, following the FID, which will constitute a substantial boom to our economy," stated Prime Minister Marape while commenting on the meeting.
Marape anticipates that the Papua LNG project will significantly contribute to his nation's economic growth, much like the "historical economic growth" experienced through the country's first LNG project, PNG LNG. The earlier project resulted in an impressive GDP increase of over 50% between 2008 and 2013.
"We anticipate a similar trajectory for Papua LNG starting from 2024 onwards," Prime Minister Marape added.
According to data from the Global LNG Database®, the shareholders in the planned Papua LNG project are TotalEnergies (operator) with a 40.1% stake, ExxonMobil (following the acquisition of InterOil in Feb. 2017) holding 37.1%, Santos Ltd (following the acquisition of Oil Search in Dec. 2021) with 22.8%, while the PNG government retains the option to exercise a back-in right for up to a 22.5% interest at the FID date.
Meanwhile, significant progress has already been made on the Papua LNG project's upstream and downstream engineering works.
In March, the Papua LNG joint venture initiated an integrated Front End Engineering Design (FEED) for the project. The FEED and Engineering, Procurement and Construction (EPC) estimation contract for the project's LNG facilities (downstream) was awarded to JGC in partnership with Hyundai Engineering & Construction Co., Ltd.
The first phase of FEED studies for the upstream facilities of the Papua LNG project was awarded in July 2022 to a consortium led by Technip Energies.
Following pre-FEED studies, the Papua LNG partners have chosen a concept involving four electric LNG trains (e-trains) with a combined capacity of 4 MMT/Y set to be developed within the existing ExxonMobil-operated PNG LNG project site. Additionally, Papua LNG has secured access to up to 2 MMT/Y of available liquefaction capacity from the PNG LNG project.
The Papua LNG project's progress and TotalEnergies' commitment underscore the potential for significant economic growth in Papua New Guinea's energy sector, with implications for the nation's overall prosperity.