courtesy FLEX LNG Ltd.

U.K.-based explorer and producer Rift Oil and Oslo-listed FLEX LNG Ltd. have agreed to develop a floating liquefaction project offshore Papua New Guinea should onshore gas reserves on the Australasian islands warrant it.

Rift is now drilling the Puk Puk prospect in the same Block PPL 235 where the Douglas gas field was discovered. The company controls the license plus PPL 261 in western PNG.

FLEX LNG was incorporated in 2006 with the objective of commercialising the world's first floating liquefaction units, or LNG Producers. The entity has signed four ship-building contracts with Samsung Heavy Industries for LNG Producer hulls utilising the SPB LNG containment system.

“This provides the LNG industry with a unique possibility of accessing currently uncommitted gas reserves for LNG production from 2011 onwards,” a FLEX statement said.

“By using the proven nitrogen expander liquefaction cycle, the most robust and flexible liquefaction technology in use in the LNG industry, an LNG Producer can source gas from numerous potential offshore locations worldwide where natural gas today is either left stranded or is being flared,” a FLEX document explains.

On Tuesday, FLEX LNG signed a Heads of Agreement with Mitsubishi and Peak Petroleum to develop and market the world's first floating liquefaction project offshore Nigeria.

"(The two companies) will also be open to processing third-party gas reserves that are commercially stranded and that can be tied into the project,” FLEX chief exec, Philip Fjeld, said in a statement.

Tags: FLEX LNG Ltd., Rift Oil Plc