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Chevron PNG-Australia gas pipeline

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DPIE97/229P 2 November 1997


"Discussions with the PNG Government concerning the proposed PNG- Australia gas pipeline, although not yet finalised, have been very constructive," the Minister for Resources and Energy, Senator Parer, said today.

Senator Parer discussed the proposed Chevron pipeline with his PNG counterpart and officials during the Australia-PNG Ministerial Forum at Alotau.

Chevron is proposing to construct a gas pipeline to deliver natural gas from the PNG Highland across Torres Strait and down the Cape York Peninsula to the Atherton Tablelands, Townsville, and Gladstone.

Senator Parer said that the Australian and Queensland Governments were very supportive of the project, which would bring significant economic benefits to both PNG and Australia.

The Australian Government is sensitive to the importance of the project to Papua New Guinea, our nearest neighbour, where it means 2500 jobs in the construction phase and 50 permanent jobs when operational in 2001.

A further 150 permanent jobs would be created at the LPG extraction facility at Kopi as part of the natural gas phase. The project could also provide up to 300 million kina a year taxation revenue for the PNG Government and 30 million kina a year in royalties to landowners over its 30 year life.

Significant regional development opportunities are also possible for both countries including the possible development of the Pandora gas field in the Gulf of Papua, which would result in further fiscal and employment benefits to PNG. In the long term, the gas project could lead to investments within PNG totalling between 5-9.5 billion kina of which 13% may be sourced locally.


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The project will retain the jobs and revenue that would otherwise be lost through the natural decline in oil production at Kutubu. It would allow the retention of the 450 jobs held by Papua New Guineans at Kutubu for a further 30 years. The project represents an efficient use of the gas which is currently being reinjected into existing wells at Kutubu.

Senator Parer stressed the importance of the pipeline project to Australia. It was an important source for meeting the demand for gas from the proposed Comalco alumina refinery at Gladstone and a proposed power

station at Townsville. The pipeline would provide independent power producers the opportunity to deliver competitively priced electricity to far north Queensland, and would form an important element in the emerging competitive Australian national gas market.

Senator Parer said that the Australian and Queensland Governments were very keen to see the project proceed. Senator Parer said he was working with the Prime Minister's Major Projects Facilitator, Mr Bob Mansfield, oversighting progress on government decisions.

Approvals for the project are well advanced and are expected to be completed in 1998.


Further information Senator Parer's office Bob Baudino (0419) 438818

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