InterOil Corporation of Papua New Guinea had secured a preliminary sales deal with Chinese company ENN for its first natural gas output, in what could be a thrust for InterOil to finally push its planned $6 Billion liquefied natural gas (LNG) project.
Under its agreement with ENN, InterOil will supply 1 to 1.5 mtpa of LNG for a period of 15 years.
InterOil's Gulf LNG project is a joint venture with Pacific LNG. It has an initial capacity of 5 million tons per annum (mtpa), with possible expansion to 10 mtpa in phases. The joint venture company target 2015 for the delivery of its 'first gas'.
Since InterOil plans to spend $6 billion in its newest venture, it needs to secure some 85 per cent in supply agreements of the total capacity before it finally stamps it approval to push through with the project.
Earlier, InterOil has sealed a commitment to deliver 2.3 mtpa in preliminary sales pacts with Gunvor,?Noble?and the Philippines' EWC. Together with the ENN deal, its total commitment now stands between 3.3 mtpa and 3.8 mtpa. To complete the 85 per cent supply agreement requirement, InterOil needs to get sales amounting to 4.25 mtpa.
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Papua New Guinea holds an estimated 226.5 billion cubic meters of natural gas reserves that can be commercialised through LNG terminals, the very reason why many?oil companies are building bases in the South Pacific.
ConocoPhillips?is already working with Australia Pacific LNG, while?Chevron,?Royal Dutch Shell?and?Apache?through the Wheatstone LNG project.?Exxon is likewise building an LNG export facility in the Papua New Guinea fields.?
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Source: http://uk.ibtimes.com/articles/274388/20111230/papua-new-guinea-s-interoil-close-finalizing.htm
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