Improved World Commodity Price Outlook Benefits Papua New Guinea : PM O’Neill

Papua New Guinea Prime Minister, Peter O’Neill  has welcomed signs that the world's largest oil producers and traders are working towards ending the production issues that saw world oil slump to the lowest level in many years in January.

"As an oil and gas producing nation, Papua New Guinea is significantly impacted when the oil price is very low - and in January the world price fell to below $US30. This week price is close to $US45," he said.

"There is a vital meeting of the major production nations this weekend, and if the outcome is positive there is general agreement the world price will not slump again, and stabilize at a sustainable level.

"It remains possible uncertainty will remain, or return, but evidence that both producers and traders are after an outcome that might bring some stability to the oil price. This is well above the lows in January and February, and is most welcome.

"We need a more confident outlook in the world oil sector if we are to secure the multi billion kina investment we need to develop our second LNG export project, together with other projects that will include downstream processing and providing affordable electricity," the Prime Minister said.

PM O’Neill said the national government was carefully monitoring trends in the international LNG area.

"With major new LNG plants coming online in Australia and several other countries, the LNG market is very competitive, with obvious over-supply risks in the future.”

Mr O'Neill said Papua New Guinea was very well placed to perform strongly even in challenging times for the LNG sector internationally.

"Our first LNG exporter has won wide acclaim for the quality of the product, and the efficiency and reliability of the delivery from the LNG plant to major customers in Asia.

"It is to the enormous credit of the Exxon-Mobil led project, and Papua New Guinea, that in a very competitive environment it is really a standout. That augurs well for future exports, and for new projects.”

Mr O'Neill said there was also cause for "cautious optimism" when it came to the world price of gold and copper.

"Both world prices for copper and gold have risen since lows at the start of the year, again a trend Papua New Guinea will benefit from.

“It is now vital that the national government, working hand-in-hand with the energy and minerals sectors, brought forward to the earliest possible date the approval and construction commencement stage of projects that would create employment, strengthen construction and business, and boost national government revenues and export income.”

The Prime Minister said the rise in the world price of the key commodities Papua New Guinea produced, and exported, was a sure sign that "the corner had been turned" and there was cause for optimism about the nation's economic future.

"I appeal to the Leader of the Opposition, and other critics pursuing political agendas, to look at the facts - and stop undermining the nation's future.

"This is the time for confidence, not doom and gloom. It is a time to build on the improving commodities outlook - and work to deliver projects that will help secure the nation's economic growth that will deliver higher living standards across the nation.

"Of course challenges remain and we should always be cautious, and the world economic outlook could change for the worse again due to factors beyond our influence.

"However, recent positive trends provide us with optimism - and the government will step up efforts to bring forward approvals for massive projects that will secure our economic future," Mr O'Neill concluded.