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Japanese firm talks to PNG LNG operators
By TERENI KENS
 "K"LINE's transport of LNG started in 1983 as first Japanese owner/operator of LNG carrier "Bishu Maru". JAPAN'S largest shipping company is currently seeking to enter into commercial arrangements with Papua New Guinea Liquefied Natural Gas (PNG LNG) proponents. The company "K" LINE (Kawasaki Kisen Kaisha, Ltd.) of Japan which is specialized in LNG shipping is talking to ExxonMobil led PNG LNG project partners of the possibility of becoming involved in shipping gas. The company with extensive relations in the Asia-Pacific region is expected to provide LNG and offshore related transportation services.It participated in Badak II, Arun II, large-scale projects for transport of LNG from Indonesia to Japan, also in Qatargas project that has successfully transported LNG from Qatar to Japan. The Investment Promotion Authority (IPA) boss, Ivan Pomaleu revealed this in an interview recently saying there is currently an overwhelming interest from other stakeholders both locally and overseas to commercialize the PNG LNG project. It is understood if the firm gets accepted by the project proponents it will start the first shipment of gas by late 2013 or early 2014. The gas will come from a proposed 360 kilometres of onshore pipeline and 415km of subsea pipeline to ship gas from the Southern Highlands to a two-train 6.3MMtpa liquefaction plant at Konebada, 20km northwest of Port Moresby. This will then be shipped to overseas markets especially in south-east Asia, UK and North America were gas demand is high. The "K" LINE has recently bought stakes in FLEX LNG -floating gas unit which has also executed Heads of Agreement (HoA) with Rift Oil to develop Kamu oil field in Western Province. Japan is PNG's most important export market, followed by Australia and the European Union. And with PNG tapping into LNG project development in the petroleum arena is likely to boost gas exports. Recently, Foreign Affairs and Trade Minister Sam Abal visited Japan to promote Japanese investment in the gas project. Among Japanese companies, Nippon Oil Corp. has a 5.3 percent stake in the project, while Chiyoda Corp. has received an order for undertaking a competitive bid process for the project's engineering, procurement and construction work. Meanwhile, Mr Pomaleu said other overseas based companies interested in the spin-offs include Middle-East Construction Company specialized in camp construction and an Indian company to undergo downstream processing and development of fertilizer from gas by-products. He however said at the local front though the interest is high it is unclear for local suppliers to get themselves involved in the spin-off businesses. "There are a lot of opportunities but the challenges lay in the hands of the project proponents. We won't know the full extent after the project is sanctioned. "The reason is that the two lead companies (ExxonMobil and InterOil) will have to submit EPC (Engineering Procurement and Construction) proposals. Mr Pomaleu also added that in the third quarter of this year pricing of the two bids on EPC will be conducted and announcements will be made for potential local suppliers. |
BUSINESS
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