Australia’s Oil Search is in “advanced stages” of negotiations with Abu Dhabi’s International Petroleum Investment Corporation (Ipic) over the sale of a 3.5 per cent stake of its interests in a new liquefied natural gas (LNG) project in Papua New Guinea.

The oil exploration and production firm hopes to sell an undisclosed percentage of its interests in the petroleum development licence 2 agreement it holds with the government of Papua New Guinea to Ipic. Oil Search is part of a consortium of companies with an interest in the licence, led by the US’ ExxonMobil Corporation.

The consortium is running the LNG project, known as PNG [Papua New Guinea] LNG, and will make a final investment decision on the scheme before the end of 2009, according to Oil Search.

The sale of part of Oil Search’s interest in the licence would give Ipic a 3.5 per cent stake in the deal, the company says. Ipic already holds an interest in the project, as it bought a 17.6 per cent holding in Oil Search in November 2008.