PNG LNG Expansion is #1 XOM priority, this trumps XOM's other current ongoing/planned projects. It's about the IRR.
So XOM had a few choices for gas which feeds/allows expansion. XOM made their choice. Feed expansion from PRL15 gas. The decision was this:
1) drill more $100,000,000 wells in Hides in hopes of finding enough resource for expansion FID.
2) look to P'nyang, which is not part of PNG LNG project. P'nyang is remote, needs further expensive wells, a 120 mile pipeline, gas and unitisation agreements.
3) buy into IOC's PRL15. Enough quality gas, near their existing tee in subsea pipeline, cheapest in the Asian region to produce and only a few inexpensive wells needed. And don't forget the exploration upside. XOM has a few routes availabe to bring PRL15 gas into PNG LNG and no partner has veto power. Oh yeah, XOM needs gas agreements to incorporate E/A gas into project and aren't those nearly complete?
