PNG-Australia gas pipeline project suspended.
The head of the company that has suspended plans to build a gas pipeline through Queensland from Papua New Guinea (PNG) admits the price of gas may rise in eastern states as a result.
Oilsearch today announced it has shelved its PNG gas project, which included the construction of a pipeline from the tip of Cape York to the south-west corner of Queensland, providing gas to Townsville, Mt Isa and Gladstone.
Oilsearch managing director Peter Botten says the project was viable, but the company has instead chosen to focus on a liquid natural gas (LNG) project within PNG that is now looking more financially attractive.
"Two years ago the number of options for PNG gas development were very limited - they were the pipeline," he said.
"However, we have seen material increases in core gas pricing over the last couple of years and that is both strong and sustained for both gas and for oil."
Mr Botten says Queensland must now place a greater emphasis on developing existing gas resources.
"There is a shortage of gas now into the east coast markets. may not necessarily be as much with queensland, but certainly into the southern markets," he said.
Mr Botten says it is possible Oilsearch will revisit the Queensland pipeline in the future.
Friday, February 02, 2007
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