Project Timelines Still Unclear: 2019 PNG Mining and Petroleum Conference Update
The 2019 Papua New Guinea Mining and Petroleum conference, now in its 27th year, is held annually to issue critical technical updates, and offer insights into the PNG resource industry and highlight new discoveries, exploration, development projects as well as social and economic achievements.
In anticipation of upcoming mining, oil and gas projects across the nation, PNG Country Manager, Stephen Mead and myself attended this year’s conference in Port Moresby. It was our hope along with the majority of the delegates that there would be some significant announcements, however unfortunately the ongoing negotiations between the state, developers and landowners have left project timelines in a state of flux.
Arriving in Port Moresby for the conference, I was extremely excited, yet confident that we were going to be given some clear guidance surrounding the timelines of the projects that have been held up due to negotiations.
The general feeling from industry professionals from the conference was that ?Everyone wants the projects to go ahead. The current negotiation process combined with not being able to come to an agreement is where the frustrations are coming from.?
One of the underlining issues for future project activity is the global LNG supply gap projected for 2024. If PNG is able to complete negotiations shortly, they could take advantage and fill the void within the market. With the deadline to fill the demand gap looming, all parties involved in the negotiations must come to an agreement, before other countries swoop in and capitalise on the supply gap themselves.
My concern is around the perception of Papua New Guinea’s sovereign risk along with the recent political movements and drawn out negotiation process I can only think foreign investors will be increasing their risk assessments for PNG which could result in challenges raising the necessary project funds.
With 2020 now just around the corner and a multi-billion project pipeline yet to be greenlit, the next 12 months present a whole host of challenges for Papua New Guinea. All we can hope is that common sense prevails and the country can start to reap some of the rewards it people deserve.
I would be very interested to hear from you: What are your thoughts? If you were at the conference, what did you take away?