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Gold/Mining/Energy : Lundin Oil (LOILY, LOILB Sweden) -- Ignore unavailable to you. Want to Upgrade?

To: Tomas who wrote (1363)	10/27/1999 10:13:00 PM
From: Tomas	Read Replies (1) \| Respond to of 2742

Crucial quarter for PNG gas project. 'Key agreements to be finalised' The National, October 28 By NIKINTS TIPTIP PORT MORESBY: The current quarter will be crucial for the PNG to Queensland gas project as several important agreements will have to be finalised before the project can officially kick off. According to Orogen Mineral's third quarter report, formal agreements between the participants in the project need to be concluded to provide a co-operative framework for developing and operating the gas fields. The development agreement on PDL1 (Hides gas field) and PDL2 (Kutubu) will be finalised this quarter. "As a result of these negotiations, final ownership interests and attendant financial obligations will be determined," the report said. Access approval agreements also need to be reached with the PNG Government and landowners on the specific terms of development of the project. It said compensation agreements with Australian landowners also need to be finalised based on the heads of agreement that has already been executed. Front-end engineering which includes advanced planning and preliminary design of all elements of the project needs to be undertaken and contract packages prepared, which will include preparation of detailed project capital and operating expenditure budgets, the report said. Orogen is currently funding approximately 20 per cent of the project's costs while final equity interests in gas field developments and infrastructure are yet to be determined. During the third quarter, negotiations on the terms of conditional gas sales agreements with two Queensland government owned corporations, Energex and Ergon, negotiating on behalf of customers located in the north and south of the state respectively, were materially advanced. It said on July 27, an agreement was reached with Energex on terms for the supply of up to 130 petajoules of gas per year to a number of industrial, commercial and domestic customers in southeastern Queensland. These customers include Tarong Energy, Comalco, Sithe Energy and CS Energy. On Aug 12, agreement was reached with Ergon on terms for the off-take of up to 53 petajoules of gas per year for supply to a number of industrial, commercial and domestic customers in Northern Queensland. "Since the initialling of the contracts, negotiations on details have continued with the objective of having binding Gas Sales Agreement ready for approval and execution by respective parties early in the fourth quarter of 1999," said the quarterly report. Refinement of possible ownership and financing structures for PNG infrastructure has continued during the quarter as did discussions with AGL - Petronas, the consortium selected to build, own and operate the gas pipeline. wr.com.au