TotalEnergies hands Papua LNG operatorship to ExxonMobil

TotalEnergies has agreed to transfer operatorship of the Papua LNG project in Papua New Guinea to ExxonMobil PNG Antelope. This move is part of a series of contractual and commercial arrangements established ahead of a final investment decision on the development. The French energy group will sell a 9.1% interest in the project, calculated after the back-in of Kumul Petroleum, to its Papua LNG partners in proportion to their existing holdings. TotalEnergies will retain a 20% stake while keeping its liquefied natural gas offtake share.

The company stated that close to four billion dollars, equivalent to 3.44 billion euros, in savings have been secured since 2024. These reductions were achieved through design changes, including an alternative upstream condensate scheme developed in synergy with the existing PNG LNG facility. Additional savings were realised by rebidding engineering, procurement and construction packages to a wider group of Asian contractors. Capital expenditure for the project currently stands at approximately 14 billion dollars. The tendering process for these contracts has been completed, with award recommendations now awaiting approval from co-venturers. The Gas Agreement signed with the Government of Papua New Guinea in 2019 has been amended to reflect the revised budget.

TotalEnergies has formed a liquefied natural gas marketing joint venture with state-related entities represented by Kumul Petroleum Holdings. This entity will sell 2.4 million tonnes per annum of the project’s planned 5.6 million tonnes per annum output. A separate offtake heads of agreement provides TotalEnergies with access to 1.5 million tonnes per annum for its own portfolio. Patrick Pouyanné, chairman and chief executive officer of TotalEnergies, described the agreements as a decisive step towards the final investment decision. He noted that the transfer of operatorship enhances value creation and competitiveness by leveraging synergies with PNG LNG during construction and operations. He also thanked the government of Papua New Guinea, led by Prime Minister James Marape, for its continuous support in achieving these milestones.

Santos has signed a binding agreement to purchase an additional 3.3% interest in PRL15 and the Papua LNG project for around 189 million dollars, or 261.8 million Australian dollars. This acquisition will lift its stake to 21%. The company said the deal would increase its equity liquefied natural gas production from the project by around 19% to roughly 1.2 million tonnes per annum. Completion of the transaction depends on regulatory approvals and a final investment decision, which is planned for the fourth quarter of 2026. The agreement is effective from 1 January 2026. The project will develop the Elk and Antelope fields in Gulf Province, with liquefaction infrastructure located near Port Moresby. The remaining partners in the venture are ExxonMobil with a 34.1% share, Kumul and MRDC with a combined 22.5% share, and ENEOS Xplora with a 2.4% share.