More news on the PNG-Australia pipeline: PNG pipeline looking for customers by year-end
ADELAIDE, Nov 4 (Reuters) - Conditional gas sale agreements were hoped to be in place this year to secure the commercial viability of the proposed A$2 billion gas pipeline from Papua New Guinea to Queensland, the project director said on Tuesday.
Chevron Corp's (CHV) John Powell said the consortium to build, own and operate the project was likely to be in place in the first quarter of 1998, with two construction consortia short-listed.
Australian Gas Light Co (AGL.AX) and Malaysian national oil company Petronas has been named a preferred bidder, along with the Nova Pacific Capital Ltd (NPC.AX) and William Holdings Plc joint venture.
The proposed 2,600 km pipeline would move natural gas from the Kutubu onshore field in the Southern Highlands of Papua New Guinea across Torres Strait and down Cape York Peninsula to Townsville and on to the industrial city of Gladstone.
Chevron Asiatic Ltd is managing the project for a consortium which includes PNG's Orogen Minerals Ltd (OML.AX), Oil Search Ltd (OSH.AX), The Broken Hill Pty Co Ltd (BHP.AX), Mitsubishi Oil Co Ltd (5004.T) and Mobil Corp (MOB). A joint venture between Stanwell Corp Ltd and Destec Energy Inc has been selected as preferred bidder for a 750 megawatt power station in northern Queensland.
Powell told an Australian pipeline industry conference that potential customers for the PNG gas included aluminum group Comalco Ltd (CMC.AX), nickel producer QNI Ltd (QNI.AX), ICI Australia Ltd (ICI.AX) subsidiary Incitec Ltd (ICT.AX), and Australian Magnesium Corp, a joint venture of Queensland Metals Corp NL (QMC.AX) and Normandy Mining Ltd (NDY.AX). Initial customers would have foundation status with some beneficial tariffs, he said.
Project directors hoped to have preliminary Australian and PNG government approvals before the end of 1997, with formal project approval by the fourth quarter of 1998, ahead of a two and a half year construction period.
A project spokesman told Reuters the pipeline would have a minimum capacity of 300 million cubic feet a day, with the proponents optimistic that capacity could grow over time to about 600 million cubic feet. |
