Papua New Guinea LNG Terminal

This article is part of the Global Fossil Infrastructure Tracker, a project of Global Energy Monitor.

Sub-articles:

FrackSwarm portal Coal terminals Coal transport and infrastructure Oil and gas pipelines LNG terminals Pipeline construction costs Methodology and data notes

Papua New Guinea LNG Terminal, also known as PNG LNG, is an LNG terminal in National Capital District, Papua New Guinea, owned by a coalition of companies led by ExxonMobil. (The project is distinct from the TotalEnergies-led Papua LNG Terminal.)

Location

The LNG Plant is located 20 kilometres northwest of Port Moresby, at Caution Bay on the south coast of PNG’s Central Province.

Loading map...

{"type":"SATELLITE","minzoom":false,"maxzoom":false,"types":["ROADMAP","SATELLITE","HYBRID","TERRAIN"],"mappingservice":"googlemaps3","width":"400px","height":"300px","centre":false,"title":"","label":"","icon":"","lines":[],"polygons":[],"circles":[],"rectangles":[],"copycoords":false,"static":false,"visitedicon":"","wmsoverlay":false,"zoom":14,"layers":[],"controls":["pan","zoom","type","scale","streetview","rotate"],"zoomstyle":"DEFAULT","typestyle":"DEFAULT","autoinfowindows":false,"resizable":false,"kmlrezoom":false,"poi":true,"cluster":false,"clustergridsize":60,"clustermaxzoom":20,"clusterzoomonclick":true,"clusteraveragecenter":true,"clusterminsize":2,"imageoverlays":[],"kml":[],"gkml":[],"searchmarkers":"","fullscreen":false,"scrollwheelzoom":false,"locations":[{"text":"","title":"","link":"","lat":-9.33862,"lon":147.01825,"icon":""}]}

Project Details

Trains 1 & 2

• Operator: PNG LNG
• Owner: PNG LNG
• Parent company: ExxonMobil (33.2%), Kumal Petroleum Holdings Limited (19.4%), Santos Limited (39.9%), ENEOS Holdings (4.7%), Government of Papua New Guinea (2.8%)
  • Formerly: ExxonMobil (33.2%), Kumal Petroleum Holdings Limited (16.8%), Santos Limited (42.5%), ENEOS Holdings (4.7%), Government of Papua New Guinea (2.8%)
• Location: Port Moresby, National Capital District, Papua New Guinea
• Coordinates: -9.33862, 147.01825 (exact)
• Type: Export
• Capacity: 8.3 mtpa (4.15 mtpa per train)
• Cost: 4.5 billion USD
• Status: Operating
• Start Year: 2014

Project Details, Train 3

• Operator: PNG LNG
• Owner: PNG LNG
• Parent company: ExxonMobil (33.2%), Kumal Petroleum Holdings Limited (19.4%), Santos Limited (39.9%), ENEOS Holdings (4.7%), Government of Papua New Guinea (2.8%)
  • Formerly: ExxonMobil (33.2%), Kumal Petroleum Holdings Limited (16.8%), Santos Limited (42.5%), ENEOS Holdings (4.7%), Government of Papua New Guinea (2.8%)
• Location: Port Moresby, National Capital District, Papua New Guinea
• Coordinates: -9.33862, 147.01825 (exact)
• Type: Export
• Capacity: 2.6 mtpa
• Status: Proposed
• Start Year: 2025

Note: mtpa = million tonnes per year; bcfd = billion cubic feet per day

Background

The Papua New Guinea liquefied natural gas (LNG) project was constructed at a cost of US$19 billion. The project involves extracting natural gas from the Papua New Guinea highlands, where it is processed before being sent via some 700 kilometres of pipeline to the PNG LNG plant in Port Moresby. The gas is then liquefied and transferred into ships for sale offshore. Construction for the project began in 2010, and the first gas shipment was made in May 2014.

The terminal has two trains with a capacity of 8.3 mtpa. A third train of 2.6 mtpa has been proposed but it was reported in February 2020 that talks between ExxonMobil and the government had broken down over the issue of profit-sharing.

According to ExxonMobil's InterOil, there is enough gas between the Elk-Antelope and P’nyang gas fields in Papua New Guinea to justify three LNG trains by 2023 to 2025, in addition to the existing two trains at PNG LNG.

In April 2020, the energy and shipping brokerage Poten & Partners disclosed that the final investment decision (FID) for Train 3 had been delayed beyond the original FID timeframe of 2020-2021. It cited COVID-19, plunging demand and the crash in oil prices as the reasons for the delay. It was previously reported, in February 2019, that the export credit agencies of Japan, South Korea, China and Australia were in discussions over the financing of the terminal's proposed expansion. In 2010, Japan Bank for International Cooperation, China Exim Bank and Export Finance and Insurance Corporation Australia were all significant financial backers of Phase 1 of the project alongside commercial banks.

In July 2020, the Australian partner Oil Search disclosed that a majority of workers at the delayed expansion project have been idled due to adverse economic conditions brought on by COVID-19.

In August 2021, Santos Limited acquired Oil Search, granting Santos a 42.5% stake in the Papua New Guinea LNG project.

In September 2022, Santos said that it had received a US$1.4 billion offer from Kumal Petroleum Holdings Limited for a 5% stake in the project. In August 2023, Santos sold 2.6% of its stake to Kumal, maintaining a majority 39.9% stake.

Opposition

Landowners and communities displaced by the project were promised benefits such as income streams and infrastructure development. Few of these promises have been fulfilled, however; for example, the township of Komo contains a newly-built hospital building that has no beds, staff, or fuel for the building's generator.

As a result, leaders of area communities organised to blockade the LNG facility by shutting off gas taps at several wells in August of 2016. Security guards attempted to stop the blockade, however, the leaders were armed. They then entered the plant site, locked site gates, and demanded the government honour original project agreements. Armed unrest over the project's failure to deliver agreed-upon benefits to the local population is ongoing.

In January 2019 it was reported that royalty payments from the project to local residents have been much smaller than had been promised by the government.