Papua New Guinea's large LNG export project Papua LNG has reached several commercial and contractual milestones ahead of a final investment decision (FID), including the transfer of operatorship from TotalEnergies to ExxonMobil and a reduction in estimated project capital expenditure to approximately USD14bn (TotalEnergies press release, 07/09/2026).
Papua LNG is a natural gas production and liquefaction project in Papua New Guinea, designed to produce 5.6 Mt/year of LNG, primarily for Asian markets. According to the press release, its development comprises gas processing facilities, a pipeline linking the fields to the liquefaction site, and LNG infrastructure located near Port Moresby.
The EPC tendering process has been completed, with recommendations for contract awards now ready for approval by the co-venturers. TotalEnergies said that project design optimization and the rebidding of EPC packages since 2024 have delivered nearly USD4bn in cost savings.
Under the revised structure, ExxonMobil will assume operatorship of Papua LNG from TotalEnergies. The two companies will oversee the transition while continuing project activities and commitments to the Papua New Guinea authorities and stakeholders.
- TotalEnergies will also divest a 9.1% interest in the project, following the planned back-in by Kumul Petroleum, to the other Papua LNG partners in proportion to their existing participating interests. Following the transaction and the State’s back-in, TotalEnergies will retain a 20% stake, while maintaining its LNG offtake share.
- Under the revised ownership structure, ExxonMobil will hold 34.1% and operatorship, Santos 21%, ENEOS Xplora 2.4%, and Kumul Petroleum Holdings Limited and MRDC 22.5% combined.
TotalEnergies has also established an LNG marketing joint venture with state-related entities represented by Kumul Petroleum Holdings to market 2.4 Mt/year of the project’s planned 5.6 Mt/year output.
Under a separate offtake heads of agreement, TotalEnergies will have access to 1.5 Mt/year for its own portfolio.