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Kumul Petroleum signs HoA with Total

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LNG Industry,

Kumul Petroleum Holdings Limited (KPHL), Papua New Guinea's national oil and gas company (NOC) has signed a binding Heads of Agreement (HoA) with Total for the joint marketing and sale of their shares of LNG and condensates to be produced by the Papua LNG Project.

Under the HoA, KPHL and Total will negotiate a Shareholders' Agreement for an Incorporated Joint Venture (IJV) to be set up as the corporate vehicle to commercialise their combined production share of LNG and condensates from Papua LNG and jointly staffed by Total and KPHL. The IJV will engage potential Buyers of LNG in the Asia Pacific region for the long term sale and purchase of their respective entitlements of LNG in Papua LNG.

Sir Moi Avei, Chairman of Kumul Petroleum said: "The agreement will allow us to demonstrate the unique value created when a National Oil Company works together with an International Oil Company. We are very confident of a successful outcome from this IJV."

Mr Wapu Sonk, Managing Director of Kumul Petroleum said: "This agreement to jointly market our share of the production from the Elk/Antelope field with Total, the Operator of the field, will allow us to develop our staff while maximising the value brought to both companies by combining the attributes of KPHL with Total. We look forward to finalising the shareholders agreement and the incorporation of the IJV in the very near future."

Mr Laurent Vivier, President Gas at Total said: "This landmark agreement with KPHL, the National Oil Company of Papua New Guinea, is an important milestone for our two companies. It will allow Total and KPHL to leverage their respective strengths for the successful marketing and sale of the LNG from Papua LNG."

"Cooperating with KPHL in hydrocarbons joint marketing is a testimony of Total strategic endeavor to continue cementing the relationship with the national stakeholders to jointly create value in Papua New Guinea," said Mr Javier Rielo, President & CEO for Total Asia Pacific.

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