Exxon reaches financial close on Papua New Guinea gas project

ExxonMobil, the world's largest publicly traded international oil and gas company, has announced financial close for the PNG LNG project in Papua New Guinea.

Financing for the project was provided by a consortium of banks and export credit agencies. Specific details has not been disclosed.

The PNG LNG project is an integrated development that includes gas production and processing facilities in the Southern Highlands, Hela, Western, Gulf and Central Provinces of Papua New Guinea. There are over 700 kilometres of pipelines connecting the facilities, which includes a gas conditioning plant in Hides and liquefaction and storage facilities near Port Moresby with capacity of 6.9 million tonnes per year.

The investment for the initial phase of the project, excluding shipping costs, is estimated at US$19 billion. Over the life of the project it is expected that over nine trillion cubic feet of gas will be produced and sold.

Project shareholders are: ExxonMobil PNG Limited (a subsidiary of Exxon Mobil Corporation) in co-venture with Oil Search Limited, National Petroleum Company of PNG (PNG Government), Santos, JX Nippon Oil and Gas Exploration Corporation, Mineral Resources Development Company (representing landowners) and Petromin PNG Holdings Limited.

The PNG LNG project commenced production of liquefied natural gas in April 2014 and delivered its first cargo of LNG in May 2014, ahead of schedule. The project has sales agreements with China Petroleum and Chemical Corporation (Sinopec), Osaka Gas Company Limited, The Tokyo Electric Power Company Inc. and CPC Corporation

Andrew Barry, ExxonMobil PNG Limited Managing Director, stated:

“This is an important milestone in the Project’s history. We shipped our first LNG cargo months ahead of schedule, and have now achieved financial completion."

“With the successful achievement of this important milestone, completion guarantees will be released, loan repayments will commence, and co-venture distributions will be permitted according to the terms of the financing agreements.”