The multi-billion-dollar Exxon Mobil-led liquefied natural gas venture has hit its first snag with a court case to decide which Papua New Guinean government agency should run the project.
PNG's Independent Public Business Corporation, the IPBC, planned this week to sign a one billion US dollar deal with an Abu Dhabi company to secure its equity in the massive LNG project.
But rival government agency Petromin PNG Holdings has successfully applied for an interim National court order which stalls the move.
Petromin, which comes under PNG Prime Minister Michael Somare's jurisdiction to manage the state's oil and gas projects, has challenged the choice of IPBC to run the venture, claiming it should be in charge.
IPBC, run by the Prime Minister's son, State Enterprises Minister, Arthur Somare, planned to use equity in the oil and gas developer Oil Search to raise more than one billion US dollars to buy a 19.4 per cent equity stake in the project.
PNG's Treasury Secretary, Simon Tosali, has written to IPBC expressing concern about this "unusual deal" while opposition leader Mekere Morauta has also questioned why IPBC is running the project.