MELBOURNE, March 26 Total has agreed
to buy a 40 percent stake in Papua New Guinea's largest
undeveloped gas field from InterOil Corp, in a revised
deal announced on Wednesday, giving the French oil giant a
smaller stake than first planned.
InterOil estimated it could receive between $1.62 billion
and $3.5 billion all together from Total, depending on how large
a reserve of gas is found in the fields.
The final stakes in the deal, which was first announced in
December, were changed to reflect the acquisition by Oil Search
of a 22.8 percent interest in the Elk and Antelope
fields earlier this month.
Total will make an initial payment of $401 million for its
40.1 percent stake, down from a 61.3 percent stake.
A further $138 million will be due in two instalments when a
final investment decision is made for an Elk-Antelope liquefied
natural gas project and a first cargo is exported. Additional
payments will be due based on the volume of gas discovered in
the license area.
Once the reserves are certified, the project partners will
have to decide whether to build a standalone LNG project, which
Total and InterOil favour, or use the Elk and Antelope gas for
an expansion of ExxonMobil's PNG LNG project, likely to
be Oil Search's preferred option.
"We have a strong relationship with our joint venturers,
strong support from the Papua New Guinea government, and we now
look forward to leading development of the LNG project,"
Jean-Marie Guillermou, Total's exploration and production senior
vice president Asia Pacific, said in a statement.
Oil Search owns a 29 percent stake in the rival $19 billion
PNG LNG project, which is due to ship its first cargo around
Citi analysts estimated the rival projects could save $1
billion to $2 billion by not duplicating LNG infrastructure.
(Reporting by Sonali Paul; Editing by Michael Perry)