ExxonMobil and PNG agree key terms for LNG expansion

ExxonMobil and PNG agree key terms for LNG expansion

ExxonMobil (NYSE: XOM) and Papua New Guinea (PNG) have agreed key terms for the P’nyang project that will expand the current PNG LNG export project.

Local media in PNG reported yesterday that the government and ExxonMobil have signed a heads of agreement regarding terms for a P’nyang Gas Agreement and Equity Purchase Agreement. Both agreements are critical if ExxonMobil is to progress development of P’nyang, which will supply its PNG LNG plant.

The heads of agreement for the gas agreement captures key fiscal, regulatory and licensing terms negotiated over last two months, reported the Post Courier. Under the latest heads of agreement, the state will acquire at cost 10% additional equity from ExxonMobil in the P’nyang project. In addition, the government take will be set at 63% in this deal compared to 49% in the legacy PNG LNG project and 51% in the TotalEnergies-led (EPA:TTE) Papua LNG scheme.