InterOil Corporation (NYSE:IOC) and Pacific LNG Operations Ltd. have signed a Heads of Agreement with Noble Clean Fuels Limited, a wholly owned subsidiary of Noble Group Limited, for the supply of 1 mtpa of liquefied natural gas (LNG) from the Gulf LNG Project in Papua New Guinea.
The Gulf LNG Project in Papua New Guinea (PNG) comprises the Elk and Antelope gas fields and Liquid Niugini Gas Ltd., the InterOil and Pacific LNG joint-venture project company, with modular LNG plants contracted with Energy World Corp. Ltd. and a Fixed Floating LNG facility being developed with Flex LNG Ltd. and Samsung Heavy Industries Co., Ltd.
The HOA sets out the basis upon which the parties intend to conclude terms for the purchase and sale of 1 mtpa of LNG, (FOB) for a period of 10 years commencing in 2014, to be supplied by the proposed Gulf LNG Project in PNG. InterOil and Pacific LNG intend to complete negotiations and execute binding agreements with Noble later this year.
InterOil Chief Executive Officer Phil Mulacek commented, "We are pleased to have executed our first HOA for LNG off-take from our Gulf LNG Project in Papua New Guinea. InterOil is proud to work with the Noble Group, which has a proven track record of providing long-term fuel supply to major utilities across Japan, Korea, China, and Asia as a whole."
Liquid Niugini Gas V.P. LNG Marketing Conrad Kerr commented, "Noble is a good fit for the InterOil strategy of mid-scale and FLNG LNG production, and LNG supply is a natural expansion of the Noble Group's historical relationships in long-term coal supply for power generation."
Noble commits to buy LNG from Gulf LNG in Papua New Guinea