Exxon's PNG LNG project cost balloon to $19 bln

SYDNEY Sun Nov 11, 2012 4:58pm EST

SYDNEY Nov 12 (Reuters) - Exxon Mobil said the cost of its gas export project in Papua New Guinea will soar to $19 billion from $15.7 billion due to foreign exchange impacts and delays from work stoppages and land access issues.

Exxon told venture partners in a letter published on Monday the PNG Liquified Natural Gas (LNG) project remains on schedule for start-up and delivery of the first LNG in 2014.

The plant's forecast capacity has been increased by 5 percent to 6.9 million tonnes per year, Exxon said.

Australian partner Oil Search said it expected the cost increases would be funded by 70 percent equity, 30 percent debt.

A couple walks along the rough surf during sunset at Oahu's North Shore, December 26, 2013. REUTERS/Kevin Lamarque

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