Release Date: 20 December 2010
Release ID: 5064
Petromin PNG Holdings, DSME E&R and Höegh LNG (the "Partners") proudly confirms that the Papua New Guinea's National Executive Council (NEC) has approved its "PNG FLNG" project which consists of an LNG Floating Production Storage and Offloading (FPSO) vessel with an annual production capacity of 3 Mtons/Y to be installed in the Gulf of Papua.
The decision was announced by the Minister for Petroleum and Energy, Mr. William Duma, during his address at the PNG Mining and Petroleum Investment Conference in Sydney on December 6th, 2010.
PNG FLNG has been approved as a standalone LNG project and is designed to commercialize gas fields within and adjacent to the Papuan Basin. In November this year, the Partners signed a Joint Development Agreement (JDA) for the ownership, development and construction of their LNG FPSO as a solution for fast-track development of Papua New Guinea's extensive undeveloped gas resources.
In a joint statement by the Managing Director of Petromin, Mr. Joshua Kalinoe, the Chief Executive Officer of DSME E&R, Mr. Jin Seok Kim and the Chief Executive Officer of Höegh LNG, Mr. Sveinung Støhle said: "The NEC approval is the first major milestone for PNG FLNG and further proves that the state shares the partnership's view that its LNG FPSO project will be a vital part for the future development of gas resources in PNG".
Over the last 4 years Höegh LNG has together with partners, including DSME, developed the LNG FPSO design and technology. The vessel and the processing systems will be constructed at the DSME ship yard in South Korea, and will be capable of producing up to three (3) million tons of LNG annually, and has storage capacity of 220,000 cubic meters, and the partners' objective is to have the unit in operation by mid 2014.
After NEC approval the "PNG FLNG" project will now enter into its next phase of development which consists of negotiating and agreeing on a Project Agreement with the PNG Government, to sign gas supply agreements with upstream owners, as well as offtake agreements for the LNG. These activities are well advanced and the partners of the PNG FLNG project are very pleased to see that the project is already experiencing strong interest from the market.
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