The cover of Business Advantage PNG’s inaugural Mining and Energy Special Edition, published this month.

Looking back over the history of resources development in Papua New Guinea, the need for patience and persistence is clear.

Big resources projects take years to develop and often go through several pairs of hands and different iterations before they come to fruition.

For instance, the gas that supplies the ExxonMobil-led PNG LNG project today was discovered by BP and Oil Search way back in 1987, 27 years before LNG exports commenced. Meanwhile, K92 Mining’s recent successful expansion of the Kainantu gold mine, which first opened back in 2006, was preceded by years of disruption and ownership changes.

Should they ultimately come to production, the proponents of resources projects such as Wafi-Golpu, Papua LNG and Pasca A will also have shown similar stamina.

In this context, it is interesting to note Kumul Petroleum’s announcement this week. It has engaged Shanghai’s Wison Offshore & Marine Company Ltd to conduct a pre-FEED (front end engineering and design) study for a Floating LNG (FLNG) facility in the Gulf of Papua.

If positive, the study could lead to the unlocking of offshore gas reserves that have been known about in the Gulf for many years. And, together with Twinza’s Pasca A project, it could launch an offshore gas sector in PNG.

According to Managing Director Wapu Sonk, state-owned Kumul Petroleum will not be going it alone in this project, in spite of being 100 per cent owner of the two fields the FLNG facility is intended to support. Instead, it will be looking to “farm down” the project “to interested partners who see value in the 1.5 mtpa FLNG project in PNG”.

As such, this project might well be a test case for the new production-sharing regime planned by the PNG Government.

Speaking at last week’s 2024 PNG Petroleum and Energy Conference in Port Moresby, Minister for Petroleum Jimmy Maladina flagged amendments of the country’s Oil and Gas Act next year to effect this change.

“We are keenly aware of the importance of creating a win-win framework – one where industry players can operate under a stable and predictable framework, while the government ensures that revenues are received from production as that production arises,” he said.

“The production-sharing regime will introduce and to sustain this balance, allowing the people of PNG to benefit at the same time as the industry.”

Business Advantage PNG‘s inaugural Mining and Energy Special Edition is published this month. Sister publication to our Business Advantage Papua New Guinea annual edition, first published in 2006, it serves two distinct purposes.

First, it provides a snapshot of the current state of the industry, including updates on PNG’s current mining and petroleum projects, and likely future projects.

Second, it provides investors in PNG’s mining and energy sector with a resource they can share with current and potential partners, wherever in the world they may be.

Drawing on many exclusive interviews with the key players, it was officially launched last week at the Petroleum and Energy Conference and is now being widely distributed. It is also online here.

If you want to obtain a hard copy, email us at info@businessadvantageinternational.com.