Micah said it was previously thought that “this type of gas” did not occur in PNG.
“We will now join the United States in this exciting development by joining the shale gas revolution,” he said, referring to the prospectivity of blocks in Southern Highlands, Gulf and Western provinces.
He warned that it might take up to seven months for licences to be issued to potential investors, as he expected strong appetite for tenements from exploration companies.
“The development of oil and gas has increased in scale and in terms of its reach throughout the country. This industry is going to have a significant impact as exploration work identifies more oil and gas reserves,” Micah told journalists at a briefing in Port Moresby.
Noting that legislation allowing for the development of unconventional gas was passed in 2015, Micah said unconventional gas had the potential to earn the country three times more money than the current conventional hydrocarbons.
“The department will be holding stakeholder workshops to establish how commercial arrangements can be reached with conventional gas holders, and proposed unconventional gas holders,” he said.
South Pacific said it had been in discussions with Kumul for some time.
The nation this week continued with the overall of its resources sector with the launch of sister company Kumul Minerals Holdings, the successor entity to Petromin Holdings.
Kumul Minerals is one of the three Kumul entities that were created by the national government. It will manage the country’s mining assets in the same way Kumul Petroleum manages the country’s oil and gas assets.
Petromin was downsized in late 2015.
Kumul minerals balance sheet will be underpinned by the transfer of the state’s shareholdings in Ok Tedi Mine and Bougainville Copper, the latter a move that has disgusted Bougainville's president John Momis.
Momis described the move as the gravest threat to the peace agreement between Bougainville and the PNG government since it was signed 15 years ago.
Last week Rio Tinto announced it had divested its majority shareholding in the operator of the former Panguna mine, with the expectation that the shares would be offered to the Bougainville and PNG governments so they have an equal stake in the company.
The idea of establishing the Kumul companies was a decision of the government in the absence of PNG entrepreneurs with sizable capital to enter the extractive industries.
Kumul Minerals managing director Thomas Abe said the company aims to more than a passive investor, rather a partner who provides benefits to companies that take risks to invest in our mineral sector.
“Ultimately we must build up a portfolio of assets that appreciate in value – and eventually provides dividends back to the people of PNG,” Abe said.