A third expansion train at ExxonMobil’s liquefied natural gas export project in Papua New Guinea appears unlikely, with joint venture partner Oil Search admitting it was no longer in its future planning.

ExxonMobil had been planning a three-train expansion to the PNG LNG development, underpinned by the Papua LNG and P’nyang developments and doubling exports from the plant.

While an agreement was reached with the PNG government for the Total-led Papua LNG development last year, talks over ExxonMobil’s P’nyang development have stalled.

This has seen focus switch to pushing ahead with Papua LNG as a standalone project to underpin two expansion trains at PNG LNG, with the third expansion train that would have been underpinned by P’nyang now in limbo.

Fifth train 'questionable'

The chief executive of PNG LNG partner Oil Search, Keiran Wulff, admitted in a call with analysts on Tuesday that his company was no longer planning for a three train expansion, but a two train expansion underpinned by Papua LNG.

“The reality is the discussions around the joint venture are: is there a third train or is P’nyang going to be used as backfill for maintaining production plateau for PNG LNG for an indefinite period going forward?,” he explained.

“Those discussions are still occurring and looking at market conditions and pricing. So, one of the big changes is that we are definitely moving to a four train programme in Papua New Guinea, the fifth train is questionable.

Enough gas to maintain plateau

ËxxonMobil’s PNG LNG project last year operated at more than 25% above its 6.9 million tonne per annum nameplate capacity and there is no current shortage of gas to keep the existing two trains full.

Oil Search says the existing fields feeding the plant will be able to maintain plateau production until about 2024, at which time production from the Angore field is anticipated to come online and extend the plateau a further three years.

In 2027 the Agogo production facility is then anticipated to start exporting gas to the plant, which is expected to further push out plateau production until at least 2030.

Papua LNG to proceed alone

Oil Search confirmed Tuesday that Total intended to enter the front-end engineering and design stage of its Papua LNG development next year, with pre-FEED work to start later this year.

That work will help the joint venture progress towards a final investment decision as it targets production commencing in 2027, with the project to see two trains built at the PNG LNG site, fed by the Elk and Antelope gas fields.

The co-owners of the Papua LNG development are operator Total on 40.1%, ExxonMobil on 36.5%, Oil Search on 22.8% and minority parties with 0.6%.

The joint venture owners of the P’nyang project are operator ExxonMobil and Oil Search each with 36.86%, Santos with 14.32% and JX Nippon with 11.96%

LNG

Development limbo: questions being raised over PNG LNG expansion train