Papua New Guinea’s Papua LNG project is on schedule for a final investment decision (FID) to be taken before the end of 2026, joint venture partner Santos said on August 19.

During its second quarter earnings call, Santos Managing Director and Chief Executive Officer Kevin Gallagher stated that project financing was moving ahead well and that more than 60% would be targeted to be funded via project financing facilities.

It comes as welcome news for the joint venture partners, which also include TotalEnergies and ExxonMobil. The project has seen FID be pushed back on three earlier occasions in 2020, 2024 and then again in 2025.

TotalEnergies and the government of Papua New Guinea first inked a foundational gas agreement in 2019. At that time, it was also announced that front-end engineering design (FEED) would commence in order for FID to be taken in 2020.

However, a change in government, fiscal renegotiations, and the Covid-19 pandemic derailed the earliest attempt at FID.

In 2024, Papua LNG again had to push back its FID date as the partners sought lower capital expenditure, insisting on renegotiating with contractors more commercially viable contracts for the engineering, procurement and construction (EPC) works.

Meanwhile, in 2025 a complex rebidding process for contractors combined with 29 international banks and export credit agencies stepping back from financing the project citing environmental, climate and human rights risks, further delayed timelines.

Buyers, particularly in energy-hungry Asia, are keen to see the project move ahead given Papua New Guinea’s geographical location. Asian buyers are also looking for another supplier for diversification, following the closure of the Strait of Hormuz in the Middle East Conflict and damage done to QatarEnergy’s Ras Laffan Industrial Complex.

Papua LNG will consist of three liquefaction units and boast a production capacity of 5.6 mn tonnes per year (tpy) of the super-chilled fuel.