By Online Editor
4:53 pm GMT+12, 23/05/2014, Papua New Guinea

The Stanley gas/condensate will be the first gas project in the country to be downstream processed, Department of Petroleum and Energy Secretary Rendel Rimua said.
 
Rimua said the state had reserved 15% of the gas for downstream processing.
 
The project is worth K856 million. The PNG LNG project is 96% bigger.
 
Rimua said instead of continuing to export, some of the gas would be used for downstream processing.  
 
“One of the things that we’ve done in this project is that state has agreed with them (developer- Horizon) that they will reserve 15% gas. We initially intended the 15% for petro chemical project which is one of the ways we are looking at now,” Rimua said.
 
“So we are encouraging people to come and do petro chemicals. But it doesn’t mean that other projects cannot access that gas. For instance, if someone wants to do a power project, you’ve got 15% gas there.”
He said the first market for the project was InterOil’s Napanapa refinery.  
 
“InterOil has committed to buy about 4000 barrels condensate a day. The 33,000 barrel tanker will come (to Kiunga) and get the condensate for the refinery. Condensate is like oil so it’s taken there and produces into diesel petrol, kerosene, etc.”
 
He said the gas would be put back into reservoir.
 
“We’ve told them (developer) that they can’t help keep that forever. So currently there are some negotiations between Ok Tedi mining for the developer to sell basically gas for power generation.
 
“They’ll use the gas to generate power for OK Tedi. Ok Tedi needs this because they are spending millions of kina to buy diesel. Diesel is good but it produces environmental problems as well and it’s a bit more expensive for Ok Tedi as well.”.