The largest oil exploration company in Papua New Guinea has launched legal action against the French oil company, Total, to contest its purchase of a 40 percent stake in PNG's biggest undeveloped gas field.
Oil Search Limited recently bought a 23 percent stake in the Elk and Antelope fields, controlled by another PNG company, InterOil Corporation, which this week signed a final agreement selling down its stake to Total.
Oil Search says it has filed a notice of dispute to InterOil regarding Total's acquisition.
It says after buying into the fields, it expected to have pre-emptive rights over the stake being sold to Total.
Oil Search wants the Elk-Antelope gas to supply an expansion of the 19-billion dollar PNG LNG project, while InterOil and Total want to build a competing standalone LNG project.
Oil Search is a 29 percent stakeholder in the PNG LNG project, which is due to start exporting around July.