Page 10 - GLNG Week 41 2021

GLNG AUSTRAL ASIA GLNG

PNG government wants

bigger stake in PNG LNG

POLICY THE government of Papua New Guinea (PNG) available in their rebalancing,” PNG Petroleum
has said that it would want to up its stake in the Minister Kerenga Kua was quoted by the Aus-
PNG LNG project if the proposed takeover of Oil tralian as saying. “The Prime Minister is asking
Search by Santos goes ahead. that the joint venture project partners should all
Under the proposed deal, Santos will acquire agree for the state to be given the first right of
Oil Search’s interest in PNG LNG, making it the refusal to acquire some portion of that equity,”
biggest single shareholder in the project, which he told the newspaper.
is operated by ExxonMobil, with a 42.5% stake. A Credit Suisse analyst, Saul Kavonic, was
Santos had said it would seek to sell down part quoted by Reuters as saying negotiations were
of the stake in an effort to help align partner likely just beginning.
holdings in the project. However, the PNG gov- “Our view is the government will extract
ernment, which needs to give its approval for something here, but ultimately it will be modest
the merger to proceed, has said it must meet the and shouldn’t prevent the deal from proceeding,”
country’s national interest. Kavonic said. He added, though, that if negoti-
PNG Prime Minister James Marape ations with the government are prolonged, this
met Santos’ CEO, Kevin Gallagher, and Oil could delay preliminary design work on the
Search’s CEO, Peter Fredericson, in Port Papua LNG project, which will have its facili-
Moresby last week to discuss the deal. The ties integrated with PNG LNG. The TotalEner-
Australian newspaper cited unnamed sources gies-led project is targeting a final investment
as saying the PNG government would expect decision (FID) in 2023.
to acquire a stake for a low price, or poten- Oil Search shareholders are due to vote on
tially via a loan. the merger on November 29, with 75% of the
“All things considered, the state would like votes needing to be cast in favour if the deal is
to pick a portion of whatever Santos will make to go through.™

EUROPE

Gazprom mulls larger Ust-Luga LNG plant

PROJECTS & RUSSIA’S Gazprom and its partner Rusgazdo-
COMPANIES bycha are considering the construction of a third
LNG train at a planned complex in Ust-Luga, the
company announced on October 7.
The company said it had signed a memoran-
dum of intent on the possible extra train with
Rusgazdobycha and Germany’s Linde. Linde and
Turkey’s Renaissance Heavy Industries secured
an engineering procurement and construc-
tion contract for the liquefaction complex in
mid-September, with analysts hailing the award camp will be ready by the end of 2022.
as a sign of concrete progress at the project. Talk of an expansion at the Ust-Luga plant
Under the original plan, the Ust-Luga plant comes at a time when global gas prices are at an
were to process 45bn cubic metres per year of gas all-time high, as a result of a surge in demand
and produce 13mn tonnes per year of LNG, 19 and supply constraints. Gazprom CEO Alexei
bcm per year of pipeline gas ready for transport Miller suggested earlier this year that the com-
to Europe and 3.6mn tpy of ethane and 2.2mn pany might fast-track some new upstream pro-
tpy of LPG. Some of these liquids would be used jects in response to bullish market conditions.
as feedstock at a nearby petrochemicals plant Gazprom was the first Russian company to
that Rusgazdobycha is developing on its own. emerge as an LNG exporter in 2009 after bring-
The project developers also signed a licensing ing on stream a plant on Sakhalin Island. But it
agreement for a liquefaction technology devel- has since been overtaken by Novatek as the lead-
oped by Gazprom and Linde to be as the project. ing LNG developer in the country. But Gazprom
They also hired Russian firm Velesstroy to build hopes to re-establish its prominence in the sector
a temporary camp for construction workers. The with the Ust-Luga project.™

P10 www. NEWSBASE .com Week 41 15•October•2021