Pom pipeline plan put on hold
Copyright 2000 The National (PNG)
December 6, 2000
THE proposed gas pipeline extension to Port Moresby, heavily promoted by Petroleum Minister Tommy Tomscoll when he previously held the same portfolio, has been put on hold.
It is likely that many years will pass before it is built, if at all.
Dr John Powell, Project Director for the PNG Gas Project, said the Government has agreed that the Port Moresby pipeline would only be built "when the market is available".
While ease of construction will be facilitated when the pipeline to Queensland is built, Dr Powell said the Chevron-led gas consortium will not build the proposed pipeline.
"Someone else will build it," he said.
It is understood that preliminary costing on the project showed that an eight-inch pipeline to Port Moresby can be built at a cost of US$130 million (K386 million).
However, such a pipeline would only be viable if markets could be found for supply of 60 million cubic feet of gas daily, or more than a tenth of the quantity required to ensure the viability of piping gas to Queensland.
Industry sources told The National the projected rate of consumption was estimated to be about five to six times the current level of total demand throughout Papua New Guinea.
Mr Tomscoll had raised the idea of building the pipeline to Port Moresby with Malaysia's national oil company, Petronas, which is a key participant in the PNG to Queensland pipeline project.
Together with Australia's AGL Ltd, Petronas will build, own and operate the Queensland leg of the pipeline and it is expected the Malaysian company will also be responsible for construction of the offshore section of the PNG pipeline as well.