Natural gas in Papua New Guinea

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Papua New Guinea has been exporting liquefied natural gas (LNG) since 2014. LNG is important for the economy, bringing in about US$3 billion in exports in 2020 and making up roughly 5% of GDP in 2019. Globally, PNG holds a small share of gas reserves and was 16th in gas exports in 2020.

There are five LNG projects in development in PNG. The Hides field is the only one currently producing LNG. The Elk-Antelope field is being developed under the Papua-LNG project, a collaboration that has involved InterOil, Total, ExxonMobil, Oil Search, and Pac LNG. Ownership and deals have shifted a lot over time, and the government has sought a larger share and a greater use of gas at home, while critics have questioned costs and governance.

The P’nyang gas field is the third project. ExxonMobil leads, with partners including Oil Search (now part of Santos) and JX Nippon. Negotiations with the government have been lengthy and complex, with important terms still being debated as plans move forward.

The Western Gas Project would bring gas from four fields in the Western Province, with Horizon Oil and partners including Kumul Petroleum. Progress has been slow and some permits have caused disputes, so timelines remain uncertain.

The Pasca gas field is offshore in the Gulf of Papua and is operated by Twinza Oil. Negotiations with the PNG government have been protracted, focusing on ownership shares and how much gas will be reserved for domestic use. Recent talks have faced challenges and delays.

The LNG plans in PNG are deeply tied to politics and finance. Past deals and loans to fund equity raised questions about transparency and who benefits most. In response, there is growing focus on production sharing, better terms for the state, more local content, and fair treatment of landowners and communities. Landowner groups have taken legal action to push for larger local stakes and stronger safeguards.

In short, PNG has important gas resources and ambitious LNG plans, but progress is uneven. The government aims to secure a fairer share of the benefits, ensure some gas stays for domestic use, and bring projects to completion in a way that supports local communities and the wider economy.