Security of LNG Project dependent on LOs and Govt

By MATTHEW VARI

Wednesday, December 3, 2014 (Midweek Chronicle, PNG) 

PNG LNG boss Peter Graham stated that the long term security of the LNG project is dependent on the relationship between the developer, Landowners (LOs) and the government of the country.

His comments were made at the PNG Chamber of Mines and Petroleum Conference in Sydney, Australia this week.

“Long-term security of the Project depends on our relationship with the traditional owners of the land on which we operate and with the government of PNG,” Graham said.

“To this end we understand the importance of transparent dealings and will continue to support government efforts to ensure that clan vetting is completed in a timely manner, and that PNG’s application for membership of the Extractive Industries Transparency Initiative is successful.”

“The first challenge, though, for any development is the accumulation of sufficient proved reserves to underpin expansion and to this end we have a number of activities underway.”

He said that it was vital for them to recognise that to do business in the country- it was going to be at a high cost, high risk, and technically challenging environment.

“The incentives for exploration and development must continue to recognise this fact to ensure that Papua New Guinea remains globally competitive,” he said.

“As we continue to explore for new opportunities in Papua New Guinea, we can build upon our lessons learned during the development of the PNG LNG Project – and I can assure you we learned a lot.”

“While ExxonMobil has nine decades of experience in PNG by the time construction work on the Project began, this Project was well beyond what we had ever done before in PNG.”

Graham pointed out that they found out very quickly that the country wouldn’t simply adapt to the way that the global company does business.

“We had to adapt some of our proven processes and develop plans to fit the local context and challenges- having said that, we always remained true to our core values and beliefs,” he added.

“It took a team of dedicated people to work through the complexities, and we were not afraid to be flexible if there was a demonstrated need to do so.”

“A one integrated team approach was critical to our success- success in one part of the Project without the other was never going to deliver the Project on time and budget.

Industry, government and community came together on the PNG LNG Project in a way he said that did not appear to have happened before in PNG.

“The importance of this Project for the economic future of the nation was clearly broadly recognised.”

“The physical challenges of the Project were so immense that it simply would have been impossible to deliver without a rock solid working partnership between our organisation, our co-venture partners, and the Papua New Guinean Government.”