23 May 2007

Mass exodus threat from PNG by oil companies

9:55 am on 23 May 2007

Oil and gas exploration companies operating in Papua New Guinea are planning a mass exodus if the government approves the deal initiated by Liquefied Niugini Gas Limited (LNG).

The Post Courier newspaper reports if the deal is approved, the state will be asked to repay the costs of their petroleum prospecting licenses if they withdraw.

The National Executive Council is to consider a proposal that would see the State, the Bank of Papua New Guinea and Liquefied Niugini Gas Ltd agreeing to the exclusivity of LNG development being awarded to LNG.

Oil and gas exploration companies said they oppose the proposal by LNG because they don't want a legislation that would force them to sell what they find to LNG.

Each exploration company spends a minimum of $US6 million and a maximum of about $US 11 million on each exploration well.