Oil Search says it’s “encouraged” by the Papua New Guinea government’s promise to stand behind a controversial gas deal that led in part to the ousting of the country’s previous prime minister.
Petroleum Minister Kerenga Kua said cabinet met on Friday and “agreed in principle that the state should stand behind the signed agreement”.
But the ministers reserved the right to discuss “a shortlist of matters” they said would not affect the general economics and fiscal terms of the agreement and would take less than two weeks to conclude.
After three delays, the gas agreement was signed in April by the PNG government and the partners in Papua LNG – France’s Total, Exxon Mobil Corp and Oil Search.
PNG prime minister Peter O’Neill resigned a month later following political turmoil over the deal and other issues, with the World Bank and International Monetary Fund criticising the agreement as bad for the PNG people.
The $US12 billion ($A17.9 billion) pact sets the terms under which the joint venture partners can expand the LNG project to double PNG’s gas exports.
Oil Search managing director Peter Botten said the company was committed to supporting Total SA in resolving any final questions on the gas agreement so the project partners could proceed to design and engineering work on the expansion.