PNG has discovered more gas fields than oil fields. Since exploration began several decades ago, the main objective has always been aimed at finding oil, but statistically about 70% of the hydrocarbon discovery to date has always been gas while 30% accounts for oil discovery. With the existence of four under explored sedimentary basins- North New Guinea, Cape Vogel, New Ireland and Bougainville and not many wells drilled in the current petroleum basin (Papuan Fold Belt), this statistical position may change because the country is very much under explored. There is potential for more oil and gas discovery either onshore or offshore in the country.

A few years ago, despite the discovery of many potential commercial fields, there has never been any interest in developing those gas fields. This has been due to either there was no market for the gas or lack of infrastructure development in this geographically difficult country.

Figure 1: Location of Gas Fields in the PNG LNG Project

The year 2008 saw a lot of activities in the Petroleum Industry fueled by the need to have alternative energy sources as a result of the beginning of the down turn in the World Economy, particularly falling oil price. During the same year the concern for the green house gas effect had generated significant interest for the need to have cleaner burner fuels around the world.

The PNG First LNG Project operated by Exxon Mobil and another project by Inter-Oil are regionally well placed to enter the world's most advanced LNG market in SE Asia. Once these projects are approved and developed, they will significantly change the economy of the country to a scale never experienced before and set the stage for the beginning of industrialization and improve the living standard of the people. While much effort is put into long term energy sales and meeting demands of the LNG market, PNG's first LNG shipment will not happen until the year 2014. The country’s major gas fields account for not less than 20 Trillion Cubic Feet of gas which includes the gas volume dedicated to the Exxon Mobil lead LNG Project and other minor fields that are scattered in the Papuan and Foreland basins.