Chevron, Santos to Start Papua New Guinea LNG Project
Papua New Guinea LNG Project
In the next few weeks, Chevron Corp. and Santos Ltd. will make a final investment decision on a liquefied natural gas project in Papua New Guinea.
The companies said a positive decision will give the green light for construction of the multi-billion-dollar PNG LNG project, which will include a gas conditioning plant, a liquefaction plant and an LNG storage and loading terminal.
The project is expected to produce 6.9 million metric tons of LNG annually, with the first LNG expected to be produced in 2014.
The project is expected to create thousands of jobs during construction and operation, and will provide significant economic benefits to Papua New Guinea.
Background of Chevron and Santos Partnership
Chevron signed a joint venture agreement with Santos in 2008 to develop the PNG LNG project.
The companies have been working together since then to secure gas supply, develop a marketing strategy and obtain regulatory approvals.
In 2010, the companies signed a sales and purchase agreement with Sinopec, a Chinese state-owned oil and gas company, for the sale of 2.5 million metric tons of LNG per year from the PNG LNG project.
Benefits of PNG LNG Project
The PNG LNG project is expected to provide significant economic benefits to Papua New Guinea.
The project is expected to generate billions of dollars in revenue for the government, and will create thousands of jobs during construction and operation.
The project will also help to develop Papua New Guinea's natural gas industry, and will position the country as a major LNG exporter in the Asia-Pacific region.
Challenges for PNG LNG Project
The PNG LNG project is a complex and challenging project.
The project is located in a remote area of Papua New Guinea, and the construction and operation of the project will require a significant investment of time and money.
The project is also subject to a number of risks, including political risks, environmental risks and technical risks.
Despite the challenges, Chevron and Santos are confident that the PNG LNG project will be a success.
The companies have extensive experience in developing and operating LNG projects, and they have a strong track record of working with governments and communities in the Asia-Pacific region.
