New Guinea Energy to Surrender Two PNG Licenses

New Guinea Energy (NGE) has sought approval from Papua New Guinea’s Department of Petroleum & Energy to surrender two licences as the company was unsuccessful in attracting farm-in partners.

The company expects the approval to be granted. If that happens the surrender becomes effective Aug 11, the date of lodgement of the application.

NGE was granted PPL 266 and PPL 267 in August 2005 and over the past eleven years has spent more than $33.9 million in these two licences on exploration activities attempting to find commercial quantities of oil and gas in this frontier exploration acreage in PNG.  “Throughout this period the company actively sought but was unsuccessful in attracting farm-in partners to share the risks, returns, and costs of exploring in both of these licences. The industry’s appetite to commit capital to frontier exploration acreage has diminished even further over the last twelve months since the fall in the price of oil.”

NGE’s tenure in PPL 266 expires on August 15, 2016 and on August 14, 2017 in PPL 267. The company believes that in the current economic climate the possibility of finding a farm-in partner for PPL 267 is so uncertain that incurring additional licence holding and exploration expenses is not justified. NGE plans to deploy capital elsewhere in investments that are consistent with its strategy.