PNG Pipeline talks proceeding well
Post-Courier, May 23
BRISBANE: Proponents of the $6 billion Papua New Guinea to Queensland gas pipeline hope to resolve negotiations with major customers before the end of the year, Queensland Treasurer Terry Mackenroth said yesterday.
The contracts, principally with Queensland’s two major energy companies Ergon Energy and Energex, remain one of the final hurdles before the project is given the go ahead.
Mr Mackenroth told the Queensland Power Conference yesterday that while gas was initially expected in 2003, the consortium behind the project was now working towards first gas in 2005.
“I am determined to see the facilitation of a base-load power station in Townsville, which is necessarily dependent on achieving a long-term source of gas supply,” he said.
“The most significant factor impacting on the establishment of a Townsville power station has been the ongoing negotiations between gas proponents — including the PNG and Timor Sea gas producers — and potential cornerstone customers in the Queensland market.
“While proponents have yet to finalise terms sheets with major customers, there have been promising developments in recent months.”
postcourier.com.pg
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PNG: Prime Minister happy with gas project
The National, May 23
Prime Minister Sir Mekere Morauta said yesterday representatives of the consortium for the PNG to Queensland gas project had assured him the project "was very much alive".
But even as Sir Mekere met with the consortium members to discuss "several issues of common concern" Queenland's Deputy Premier Terry Mackenroth told a power conference the PNG gas project was facing vigorous competition from other projects.
"To an increasing extent, there is genuine competition among proponents for gas supply from PNG, Timor Sea and coal seam methane sources, which make this an exciting time for the gas industry in Queensland," he said.
Mr Mackenroth said that plans to build a gas-fired power station at Townsville by 2003 had been affected by unavailability of gas with the likelihood that this station would now be commissioned by 2005.
Comments made by Queensland's Deputy Premier suggested that the PNG gas consortium still remained in the lead position since the green light is now only dependent on the completion of sales agreements.
He said proponents of the PNG Gas Project, now headed by ExxonMobil, had indicated "that they will be undertaking renewed negotiations with potential customers during 2001 with a view to resolving terms sheets later this year".
"It has also been an eventful 12 months for the Timor Sea proponents, the other major source of potential offshore gas supply.
"Both Philipps/Epic and Shell/Woodside are also dealing with prospective customers about the terms of gas supply."
Mr Mackenroth said the Queensland Government was closely watching negotiations between the Australian Government and the United Nations Transitional Authority in East Timor over financial and legal arrangements regarding oil and gas developments in the Timor Gap area.
Delays in these negotiations are holding back plans for a liquefied natural gas (LNG) export project to the United States and a proposal for a gas pipeline via Darwin to Moomba in central Australia.
zipworld.com.au
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Reports of pipeline project demise anger Papua New Guinea premier
Post-Courier, 21 May
The recent cabinet reshuffle should not have any impact on major projects like the Queensland gas project and Ramu nickel mine, Prime Minister Sir Mekere Morauta said. Sir Mekere's reassurance comes after reports that industry people and investors had expressed concern about the security of the projects with constant changes at the political level to key figures involved.
In the fifth reshuffle since the Mekere government took office, Gulf Regional member Chris Haiveta was removed as minister for petroleum and energy [on 17 May] and replaced by Ialibu-Pangia member Roy Yaki. Sir Mekere expressed anger at reports that the gas pipeline was "dead".
"Gas pipeline is so vital. It's so stupid to conclude that because of one ministerial reshuffle, it will affect the projects," Sir Mekere said. He described the reports as "absolute rubbish, utter nonsense".
Sir Mekere said investors need not fear unnecessarily for the security of the projects because of a few changes in ministries. With the Queensland-owned Energex and Ergon pulling out as major customers, Sir Mekere said it was now up to the project promoters ExxonMobil to find buyers for the gas. ExxonMobil took over the operatorship of the project from Chevron recently. He said they were aware of the Queensland government's intention to downgrade its involvement in the project and that it was not something new that they had recently learned.
Mr Yaki, the new minister, said he will give his utmost support to see the projects pull through and dismissed suggestions that the gas project was "dead"...
[Yaki said:] "The critical challenge is for the companies to finalize the gas sales contracts in Queensland. Esso have taken the responsibility for that and I understand that they are very pleased with their recent discussions with customers. The change in the roles of Energex and Ergon should not have an adverse effect on the project. It allows Esso to have direct negotiations with the customers in Queensland, rather than go through the energy wholesalers. As far as I am concerned this is a helpful change."
Mr Yaki said the government was very committed to the gas project, which was vital to the future of the petroleum industry. "I am as determined as Chris Haiveta was to see the project come to reality and I shall be doing all I can to achieve that," he said.
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Backers Of PNG-Queensland Gas Pipeline To Resolve Negotiations
BRISBANE, May 22, Asia Pulse - Proponents of the $A6 billion ($US3.15 billion) Papua New Guinea to Queensland gas pipeline hope to resolve negotiations with major customers before the end of the year, Queensland Treasurer Terry Mackenroth said today.
The contracts, principally with Queensland's two major energy companies Ergon Energy and Energex, remain one of the final hurdles before the project is given the go ahead.
Mr Mackenroth told the the Queensland Power Conference today that while gas was initially expected in 2003, the consortium behind the project was now working towards first gas in 2005.
"The most significant factor impacting on the establishment of a Townsville power station has been the ongoing negotiations between gas proponents - including the PNG and Timor Sea gas producers - and potential cornerstone customers in the Queensland market," he said.
"While proponents have yet to finalise terms sheets with major customers, there have been promising developments in recent months."
After failing to secure any contracts with major customers last year, the PNG proponents last month overhauled the management structure of the pipeline, dumping Chevron in favor of an ExxonMobil managed committee.
"The project proponents have indicated that they will be undertaking renewed negotiations with potential customers during 2001 with a view to resolving terms sheets later this year," Mr Mackenroth said.
Australian listed groups Oil Search Ltd, Orogen Minerals Ltd and Santos Ltd also have an interest in the pipeline, which will source gas from the PNG highlands.
He said securing a gas fired power station for Townsville, underpinned by firm long term gas supplies, was part of a broader push by the government to secure new long-term sources of gas for Queensland.
"Facilitating competitively priced gas into regional centres such as Townsville and Gladstone, and Brisbane's port area has the potential to act as a catalyst for major investment in resource processing industries, as well as acting as a feedstock for new fertiliser and chemical projects," he said.
He added there was a range of competing developments for gas supply and transportation within the market and the government did not hold any preconceived views as to the best means of securing delivered gas to the Townsville power station.
"I cannot stress enough that we have an 'open mind' as to the best means of delivering low cost gas to the power station," he said.
"Proponents will find that we do not hold any preconceived views about whether the gas is secured from PNG, Timor Sea, Coal Seam Methane or South West Queensland.
"We are under no ideological or legal obligation to favour particular proposals and we will not be `picking winners'."
He also said it was the government's clear responsibility to seek to eliminate, or minimise to the greatest extent possible, any financial impact on the Queensland taxpayer through government subsidies.
"Our Government-owned Corporations (GOCS) will be required to negotiate on commercial terms with private sector parties and, should any support be required, it will be a matter for explicit consideration by the government itself," he said.
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Papua New Guinea: New minister says Queensland gas project "very much alive"
The National, May 21
New Petroleum and Energy Minister Roy Yaki has dismissed suggestions that the proposed PNG-Queensland pipeline project is "dead". Mr Yaki said in a statement that "the project is very much alive" and his priority is to turn the project into reality.
The Queensland government announced last week that it was downgrading its involvement in the 3.5bn US dollar project from a buyer to that of a consumer, prompting suggestions from industry sources that the project could be "dead". However, Mr Yaki rejected this.
"The PNG government and the gas companies are very close to signing a gas agreement. A lot of progress has been made recently. There are a few outstanding issues, but I am confident that they can be solved over the next two to three months." He said the critical challenge was for the companies to finalize the gas sale contracts in Queensland.
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