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LNG's Brightest Star Leads to Poor Pacific Nation With Cost Edge

  • Papua New Guinea LNG ventures offer lower labor costs, taxes
  • Exxon-led PNG LNG expansion could lure Japan buying, FGE says
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Papua New Guinea ranks among Asia’s poorest nations. In the battered liquefied natural gas sector, it’s one of the most promising. 

Ventures tapping the country’s resources are attractive even after a 67 percent collapse in Asian gas prices because development costs can be half those in neighboring Australia, the world’s third-largest LNG exporter. Such are the market’s prospects that Oil Search Ltd. -- which has operated in Papua New Guinea since 1929 -- rejected an $8 billion bid from Woodside Petroleum Ltd. last month in what would have been the biggest energy acquisition in Asia Pacific.