This replaces the original agreement made in July 2003 to supply gas to Comalco through Energex.

PNG Gas Project partners, Oil Search and ExxonMobil, said the venture expected to convert all conditional gas sales contracts into firm agreements before a project sanction decision in early 2006.

Exxon Mobil Corp subsidiary Esso Highlands Ltd operates the PNG gas project. Project manager Peter Graham said the project was moving closer towards commercialisation.

“This builds on recent milestone events such as the recent sales of PNG Gas to AGL and to the Alcan Gove Alumina Refinery and the decision by the project participants in October 2004 to enter into front-end engineering and design (FEED),” Graham said.

APC, a Petronas and AGL-led consortium, is undertaking the FEED program for the Australian part of the pipeline, with GHD commissioned as FEED contractor.

The PNG Gas Project participants are: Oil Search (54.2%); ExxonMobil (39.4% - Esso Highlands as operator); Nippon Oil Exploration (3.4%); and MRDC (3% - a PNG company representing landowner interests).