By David Winning and Ross Kelly
SYDNEY--ExxonMobil Corp. (XOM) said Friday it is in exclusive
talks with InterOil Corp. (IOC) to invest in its natural gas assets
in Papua New Guinea, a move that could cement the impoverished
Southeast Asian country's position as a new significant energy
exporter.
The talks show how rising Asian demand for clean fuels is
prompting international companies to raise their bets on regions
that have previously played only a small role in the global energy
industry. Papua New Guinea, better known for its jungles and tribal
violence, is due to start receiving a major revenue injection next
year when the ExxonMobil-led $19 billion PNG LNG project starts
up.
Houston-based InterOil owns the Elk and Antelope natural gas
discoveries in Papua New Guinea. In 2009, it signed an agreement
with the government to develop a large-scale liquefied natural gas,
or LNG, project on the south coast.
"ExxonMobil is in exclusive negotiations with InterOil over the
Elk and Antelope developments," an ExxonMobil spokeswoman said by
phone from Port Moresby, Papua New Guinea's capital, Friday.
In a statement confirming the talks with Exxon, InterOil said it
is discussing whether gas from the Elk and Antelope fields would
support an expansion of the PNG LNG project or a new gas-export
facility. It didn't specify financial terms.
Write to David Winning at david.winning@wsj.com and Ross Kelly
at ross.kelly@wsj.com
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