Prime Minister Hon. James Marape today welcomed the signing of amendments to the Papua LNG Gas Agreement as a major milestone that moves Papua New Guinea significantly closer to the Final Investment Decision (FID) and construction of the country’s second liquefied natural gas project.
Speaking after the signing ceremony at Government House, witnessed by Governor-General Sir Bob Dadae, Prime Minister Marape said the amended agreement reflected the realities of the global investment environment in 2026 while safeguarding Papua New Guinea’s long-term interests.
“This is a major milestone for the progress of our nation towards unlocking our second LNG project and moving decisively towards Final Investment Decision and construction,” Prime Minister Marape said.
“I commend the outstanding work of TotalEnergies, the lead operator of Papua LNG, ExxonMobil, our State Negotiating Team led by Chairman Dairi Vele, Petroleum Minister Hon. Jimmy Maladina, the Department of Petroleum and Energy, Kumul Petroleum Holdings Limited, MRDC and all those who worked tirelessly to bring us to this important point.”
FID TARGETED BEFORE YEAR-END
Prime Minister Marape said the amended agreement paved the way for the project partners to achieve Final Investment Decision before the end of 2026.
He said the project had undergone a comprehensive review to ensure it remained globally competitive, with estimated development costs reduced from around US$18 billion to approximately US$14.5 billion.
“This agreement gives certainty to investors while protecting Papua New Guinea’s national interests. We are now working towards Final Investment Decision before 15 December this year, although our partners have indicated they will strive to reach that milestone even earlier.”
BALANCED OUTCOME FOR PNG
Prime Minister Marape said the Government had successfully negotiated a balanced arrangement that preserved Papua New Guinea’s long-term benefits while ensuring the project remained commercially viable.
He said Kumul Petroleum would retain its 22.5 percent equity stake in the project, with the State also expressing interest in acquiring any additional equity that may become available.“The State has not compromised its ownership position. We continue to hold a substantial stake in Papua LNG and will also bear our share of the project’s costs,” he said.
Prime Minister Marape said the State had agreed to investment incentives valued at approximately US$1.95 billion while introducing an innovative “give or take” mechanism under which the State would recover value when project returns were stronger.
“For the first time in our resource negotiations, we have introduced a mechanism that ensures balance. During good times, the State recovers value. During difficult times, investors receive the support necessary to keep the project commercially viable. It is a genuine win-win arrangement.”
PNG COMPETING FOR GLOBAL CAPITAL
Prime Minister Marape said Papua New Guinea had secured the confidence of some of the world’s largest energy companies despite intense global competition for investment.
“TotalEnergies and ExxonMobil both have substantially larger gas investments in Mozambique involving resource bases of more than 80 trillion cubic feet and multi-billion-dollar developments. Despite those opportunities, they have maintained confidence in Papua New Guinea.”
He said the successful delivery of PNG LNG had established Papua New Guinea as a credible investment destination for global energy companies.
“The success of PNG LNG continues to provide a strong reference point for international investors considering Papua New Guinea.”
K60 BILLION INVESTMENT TO DRIVE GROWTH
Prime Minister Marape said the approximately US$14.5 billion Papua LNG Project represented close to K60 billion in foreign direct investment and would generate employment, business opportunities and economic growth throughout the country.
He said the Government’s strategy was to sequence Papua LNG with the proposed P’nyang LNG Project to ensure continuous major resource investment over the next decade.
“We do not want another long gap between major resource developments. Our strategy is to progress Papua LNG and then P’nyang LNG, creating almost K100 billion worth of construction activity over the next decade.”
Prime Minister Marape said future developments, including Muruk, Kimu, other satellite fields and the proposed Wildebeest Project in the Gulf of Papua, could extend Papua New Guinea’s oil and gas industry well into the second half of this century.
APPRECIATION TO PROJECT PARTNERS
Prime Minister Marape thanked TotalEnergies Chairman and Chief Executive Officer Patrick Pouyanné, ExxonMobil Chairman and Chief Executive Officer Darren Woods, Santos, JX Nippon, Kumul Petroleum Holdings Limited, MRDC and all project stakeholders for their continued commitment to Papua New Guinea.
“I thank all our partners for their faith in Papua New Guinea. Together we are unlocking our natural gas resources in a way that creates jobs, stimulates business, grows our economy and delivers lasting benefits for our people for generations to come,” Prime Minister Marape said.