ExxonMobil and its partners have approved the development of a US$15 billion (Dh55bn) liquefied natural gas (LNG) project in Papua New Guinea that will supply gas to China Japan and Taiwan. The project has links to Abu Dhabi through an indirect stake in the venture held by the emirate's International Petroleum Investment Company (IPIC). It adds to the competition that Qatar faces in the Asia Pacific market, as the leading LNG exporter seeks more buyers for its rapidly rising output amid a supply glut.
The partners in the PNG LNG project, which could start shipping gas in 2014, are counting on the medium to long-term market for the super-chilled fuel to strengthen significantly, in part because developing Asian economies are seeking to cut carbon emissions and pollution from their mainly coal-fired power sectors. "With global demand for LNG forecast to nearly triple by 2030, the PNG LNG project will be an important supply source to meet this future demand, particularly for the economies in the fast growing Asia Pacific region," said Neil Duffin, the president of ExxonMobil Development Company, a unit of ExxonMobil.
"The supply of cleaner-burning natural gas will also be critical in helping reduce global (carbon) emissions," he added. The project includes gas production and processing facilities, onshore and offshore pipelines, and gas liquefaction facilities on Moresby Bay in Papua New Guinea with 6.6 million tonnes per year of production capacity. Construction is expected to start next year. IPIC holds 17.6 per cent of Oil Search, a Papua New Guinea oil and gas company with a 29 per cent stake in the LNG development. The project's operator, with 33.2 per cent, is Esso Highlands, an ExxonMobil affiliate.