Ann: Notices in respect of PDL 10 in PNG, page-9

The problem with Stanley is that it's modest size has made it unviable to commercialise as a stand alone given its stranded geography and the price of LNG. It was only recently with the improvement in LNG demand and new discoveries that identified resources that could be linked with Stanley ie the WLNG that commercialisation has become viable. Back in 2016 phase 1 of a commercialisation plan was to use gas from Stanley to power the Ok Tedi Mine. In meetings between Repsol as the operator and OK Tedi (HZN present) it appeared that a deal was close. The obstacle was that OK Tedi had to spend $xm (I forget the figure) to change to gas power generation. At the time OK Tedi was owned by the PNG Government so it was down to them to stump up the cash to run the mine on gas from Stanley. They kept saying they would deliver on this but never did and over the past 18mths or so the OK Tedi plan was abandoned. Had the PNG Govt come to the commercialisation party with the contribution they promised Stanley would be selling some of its gas right now. Instead, they are complaining that Stanley hasn't been commercialised as if the fault lies with the licence holders. And just as Balang buy Repsol's share and commit to commercialising Stanley the PNG Government throw another spanner into the works by threatening to take the Stanley licence back. PNG has separation of powers, ie an independent legal system and ultimately the Government will look very silly if this ends up in court. One would think they will get legal advice to that effect very soon and back right off.