JX Nippon farms into PRL15 in PNG
JX Nippon Oil & Gas Exploration Corporation on June 2 announced its farm-in agreement with TotalEnergies for a 2.58% participating interest in PRL15, which includes the Elk-Antelope gas field, a crucial component of the Papua LNG project in Papua New Guinea. The agreement is still pending approval from the department of petroleum and energy of Papua New Guinea.
The Papua LNG project, the country's second LNG project, is designed to have a production capacity of 5.6mn metric tons/year. It aims to commercialise the natural gas resources found in the Elk-Antelope onshore gas fields located in Gulf Province. To facilitate this, a pipeline will transport the gas to Caution Bay, where additional liquefaction facilities will be constructed.
Noteworthy is the project's commitment to carbon capture and storage (CCS) measures. From the beginning of the project, the development plan includes the removal of native CO₂ at the upstream central processing facilities, which will then be reinjected into the reservoirs.
With the support of the government of Papua New Guinea, the Papua LNG partners have recently launched fully-integrated front-end engineering and design (Feed) activities for the project. They aim to achieve the final investment decision by the end of 2023 or early 2024, with the first LNG cargo expected to be shipped by the end of 2027 or early 2028.
For JX Nippon Oil & Gas Exploration Corporation, the Papua LNG project marks its fourth LNG venture, following its involvement in the Malaysia LNG Tiga project, Tangguh LNG project in Indonesia, and the PNG LNG project in Papua New Guinea.
Santos holds a 22.8% interest in Papua LNG along with joint venture partners TotalEnergies (40.1% and operator) and ExxonMobil (37.1%). The state of Papua New Guinea may exercise a back-in right for up to a 22.5% interest at the final investment decision. Should Papua New Guinea exercise its full back-in right, Santos' interest in the project would reduce to 17.7%.
Santos also has a 42.5% interest in PNG LNG and in September last year announced a conditional agreement to sell a 5% interest in PNG LNG to Kumul Petroleum Holdings for an asset value of $1.4bn.