Australian consultancy firm ACIL Tasman's PNG LNG Economic Impact Study, released in February, put the capital expenditure cost at $US10 billion.

However, ACIL Tasman executive director Paul Balfe told PNGIndustryNews.net the capital cost estimates prepared by the project proponents were current as of mid 2007.

With the American dollar depreciating 12.43% compared to the Australian dollar in the period of June 30, 2007 to today's date, the $US10 billion figure from mid last year would now be at the value of $US11.24 billion under those calculations.

Without an updated announcement on the project costs, other than project operator ExxonMobil's recent "over $US10 billion" figure, media reports have varied between $US10 billion and $US11 billion.

The ExxonMobil-led consortium to develop the PNG LNG project, which has entered the front end engineering design phase, will source gas from the Hides, Angore and Juha fields as well as associated gas from the operating Kutubu, Agogo, Gobe and Moran oil fields in the Southern Highlands and Western Provinces.

The gas will be treated at a plant at Hides before being piped to the liquefaction plant, expected to start production in 2013.

Partner Oil Search expects the project will provide a large, stable income source for more than 20 years after the first LNG sales. These are expected to go to Asian markets in late 2013 or early 2014.

The PNG LNG project ownership consists of ExxonMobil at 41.6%, Oil Search at 34.1%, Santos 17.7%, AGL Energy 3.6%, and Nippon Oil 1.8%. Landowner interests hold the remaining 1.2%.

AGL intends to sell its 3.6% stake by December, with joint venture partners holding some pre-emptive rights over this transaction.