Gulf leaders meet with IOC and repeat request

[Palm]

Gulf leaders have met with IOC including new CEO Michael Hession. Lets see how good he is at all of this. O'Neill and Duma will have to speak before long. Part of the process of meeting with new leadership.

Gulf leaders stand firm on LNG processing

Source:

The National, Friday July 19th, 2013

 THE Gulf provincial government is adamant that its natural gas resources will be processed within the province and not in other parts of the country.

This means that the developer of the proposed Gulf LNG project will required to build and operate a liquefied natural gas processing plant in Kerema.

Governor Havila Kavo, Kikori MP and Labour and Industrial Minister Mark Maipakai and Kerema MP Richard Mendani stressed this point in a joint statement in Port Moresby yesterday.

In a show of solidarity for their people, the three leaders issued the statement after a meeting with senior executives of InterOil at the Ela Beach Hotel.

“This is the firm position of the provincial government on behalf of its people and will not change even if a new developer comes into picture,” the leader said in a statement.

“We reaffirm the provincial executive council decision on Dec 17, 2012. This decision was further ratified unanimously by the members of the provincial assembly on Dec 18 in line with the wishes of the people of Gulf.

“Since the LNG project agreement was signed between the Liquefied Natural Gas Ltd (LNGL) and the State in 2009, InterOil had continuously failed to honour its commitments under the agreement.”

Kavo added: “The poor performance of InterOil and its failure to honour key terms under the 2009 deal was relayed to the InterOil board chairman Dr Gaylen Byker, chief executive officer Dr Michael Hession and vice president corporate development and government Isikeli Taureka in the meeting.”

The leaders said that InterOil’s commitment had been less than forthcoming and the final affront was when InterOil failed to make a final investment decision (FID) by the required June 24 deadline this year as required under the 2009 agreement signed with the Government.

They also remained unmoved on the “no pipeline” policy for their oil and gas.

The province has major gas reserves at Antelope and Elk gas fields in the Baimuru district.

InterOil and LNGL were the development partners under the 2009 agreement with the State and the provincial government to develop the gas reserves.

The partners have since brought in ExxonMobil, the LNG project developer, and are in negotiations on developing the Elk/Antelope resources.

Kavo, Maipakai and Mendani agreed that an LNG project would be the single biggest economic development in Gulf and would underpin the successful implementation of the province’s Vision 2020 objectives.

“We will not let this opportunity pass or go to waste.”

http://www.thenational.com.pg/?q=node/53081

None of this is new and will be dealt with.

[Palm]

Just in time for OE tomorrow. Surprised? Some things don't change.

[Palm]

Interesting article given the article from just a month ago:

"Gulf eyes huge growth

Source:

The National, Thursday 6th June 2013

 By JOHN PANGKATANA

GULF is driving towards industrialisation, Governor Havila Kavo says.

He said the province was rich in resources but the people had not participated meaningfully for the past 30 years.

“The time for us begging and drifting around the country is over. It’s time to come home and look after your land and be seen as landowners, so that you can benefit in huge development that will give Gulf a much-needed face-lift,” he said.

Kavo said the Gulf LNG project would be the catalyst to rejuvenate the province.

He added that the development of the country’s third international port would also boost the province’s economy.

“We will ultimately be the second alternate to the nation’s capital; this project will open up economic activities,” he said.

He urged Gulf leaders and stakeholders to put aside their differences and take advantage of the proposed new developments such as the liquefied natural gas project.

The governor welcomed the “good news” that InterOil was negotiating with global giant ExxonMobil to develop the Gulf LNG project.

“InterOil Ltd and Pacific LNG Ltd will be working with ExxonMobil over the next 60 days towards finalising certain documentation,” he said.

“I understand that InterOil and Pacific LNG are selling an interest in Petroleum Retention License (PRL) 15 to ExxonMobil to develop an additional train for the LNG plant facility at Portion 152, near Papa village.

“As a provincial government, we acknowledge that this will help accelerate the development of the Elk/Antelope infrastructure such as pipelines, gas stripping plant and other supporting infrastructures.”

Kavo said he had been advised that additional wells would be drilled in the Elk/Antelope gas fields to give the companies a better definition on reserves. 

“This will provide more jobs for my province,” he said.

The governor said that he was also in the process of setting up a provincial working committee to work with InterOil and ExxonMobil to support the project.

He reiterated that Gulf’s gas resources must be developed in the province and his provincial government would support InterOil and ExxonMobil."

So what we have is the expected meeting between the Gulf leaders and interoil as expected. With IOC's new leadership in place and the IOC/XOM negotiations possibly nearing completion Kavo and the other leaders requested and received audience with IOC. Amazing how different two articles within a month can be. As usual; reality likely falls somewhere in between.

[Stavros]

What's amazing to me is that the Gulf natives/ clans are "blaming" IOC for not progressing the Gulf LNG Plant that was to utilize a Floating LNG plus EWC modules.

"The leaders said that InterOil’s commitment had been less than forthcoming and the final affront was when InterOil failed to make a final investment decision (FID) by the required June 24 deadline this year as required under the 2009 agreement signed with the Government."

The truth is that IOC was ready to make their FID many MANY months ago but was hijacked by Mr. Duma et al.

This is typical of the final negotiations end-game when the loser makes his last outrageous demands to get one or two additional concessions before the ink is put to paper.

I look for the IOC/XOM deal to be signed and announced around the end of August when all the dust finally settles and gets swept up. If it's earlier then we'll all be very happy campers.

What happens to the PPS in the next 6 weeks is anyone's guess, especially now that the SPX is at all-time high and many pundits are predicting an imminent 10-20% correction in the markets.

[Palm]

So the likely outcome? Nothing that we don't already have and basically what Kavo stated back in June. They understand the importance of PNG LNG using EA gas to supply Train 3. That is in the best interest of all. The IOC/XOM initial terms agreed to already allow for an LNG plant in Gulf, either with XOM or with someone else. That's what the Gulf leaders want in the end; a project that will create jobs and drive development in Gulf. That's what this is about and that's what we'll end up with IMHO. An LNG plant that meets the new minimum output. Proving up enough gas for that will not be tough. Likely they will have enough for this, Train 4 for PNG LNG, and beyond.

Negotiating is part of what Hession and Isikeli Taureka were brought in for. They know how to get this stuff done.

[j4j]

So the likely outcome? Nothing that we don't already have and basically what Kavo stated back in June. They understand the importance of PNG LNG using EA gas to supply Train 3. That is in the best interest of all. The IOC/XOM initial terms agreed to already allow for an LNG plant in Gulf, either with XOM or with someone else. That's what the Gulf leaders want in the end; a project that will create jobs and drive development in Gulf. That's what this is about and that's what we'll end up with IMHO. An LNG plant that meets the new minimum output. Proving up enough gas for that will not be tough. Likely they will have enough for this, Train 4 for PNG LNG, and beyond. Negotiating is part of what Hession and Isikeli Taureka were brought in for. They know how to get this stuff done.

fwiw, today's pngindustrynews.net  article has a much more balanced/positive spin on this meeting.

[jft310]

Gulf leaders have met with IOC including new CEO Michael Hession. Lets see how good he is at all of this. O'Neill and Duma will have to speak before long. Part of the process of meeting with new leadership.

Gulf leaders stand firm on LNG processing

Source:

The National, Friday July 19th, 2013

 THE Gulf provincial government is adamant that its natural gas resources will be processed within the province and not in other parts of the country.

This means that the developer of the proposed Gulf LNG project will required to build and operate a liquefied natural gas processing plant in Kerema.

Governor Havila Kavo, Kikori MP and Labour and Industrial Minister Mark Maipakai and Kerema MP Richard Mendani stressed this point in a joint statement in Port Moresby yesterday.

In a show of solidarity for their people, the three leaders issued the statement after a meeting with senior executives of InterOil at the Ela Beach Hotel.

“This is the firm position of the provincial government on behalf of its people and will not change even if a new developer comes into picture,” the leader said in a statement.

“We reaffirm the provincial executive council decision on Dec 17, 2012. This decision was further ratified unanimously by the members of the provincial assembly on Dec 18 in line with the wishes of the people of Gulf.

“Since the LNG project agreement was signed between the Liquefied Natural Gas Ltd (LNGL) and the State in 2009, InterOil had continuously failed to honour its commitments under the agreement.”

Kavo added: “The poor performance of InterOil and its failure to honour key terms under the 2009 deal was relayed to the InterOil board chairman Dr Gaylen Byker, chief executive officer Dr Michael Hession and vice president corporate development and government Isikeli Taureka in the meeting.”

The leaders said that InterOil’s commitment had been less than forthcoming and the final affront was when InterOil failed to make a final investment decision (FID) by the required June 24 deadline this year as required under the 2009 agreement signed with the Government.

They also remained unmoved on the “no pipeline” policy for their oil and gas.

The province has major gas reserves at Antelope and Elk gas fields in the Baimuru district.

InterOil and LNGL were the development partners under the 2009 agreement with the State and the provincial government to develop the gas reserves.

The partners have since brought in ExxonMobil, the LNG project developer, and are in negotiations on developing the Elk/Antelope resources.

Kavo, Maipakai and Mendani agreed that an LNG project would be the single biggest economic development in Gulf and would underpin the successful implementation of the province’s Vision 2020 objectives.

“We will not let this opportunity pass or go to waste.”

http://www.thenational.com.pg/?q=node/53081

None of this is new and will be dealt with.

This NEW article was published in The National this is the newspaper where you pay a fee to get your article published. No editorial board just pay a fee and see your story. Now who would pay for such a story?????

[Palm]

It'll be interesting to see how the bashers try and spin this as being a major negative:
1. Will probably use excessively descriptive words in titles of posts to make it look like this was an angry mob when in fact it was a meeting by 3 people with 3 IOC top brass. I think one of the 3 from Gulf was a LO.
2. Make it sound like since there were 3 of IOC's top brass in the meeting that it somehow shows that it is a superdeduperty huge issue when in fact it's just the right way to do business. Best way to show you are serious is to have real decision makers be in the meeting especially since 2 are just assuming their leadership roles. Especially the new development and gov relations guy. Highly respected local guy who people will relate well to.

Whomever made sure this article got in just in time for OE day has been defeated by logic and reason; and a good bit of truth.