By November the ExxonMobil-led PNG LNG project was deemed 70% complete - a remarkable achievement when considering the periods of horrendous weather at its various remote sites in the Southern Highlands region alone.
Then there was the devastating Tari landslide that claimed up to 68 lives early this year. The natural disaster zone was not too far from the Tumbi quarry used by a project contractor four months earlier, which further complicated the community relations front.
Yet the project's 21% cost blowout to $19 billion is gathering the most recent attention. The increase is up 27% from the original $15 billion price tag of several years ago.
There is typically a link between project cost blowouts and schedule delays but Exxon stressed that PNG LNG's first exports remained on target for 2014.
Analysts tend to focus on the behind-schedule Komo Airfield site, which is designed to land heavy items for the project's Hides gas conditioning plant through giant Antonov AN-124 cargo aircraft.
In a research note, Macquarie Private Wealth revealed that the first load from an Antonov aircraft was not expected until February, six months later than planned.
MPW expected this to further draw out the plant's construction and expose the project more to the declining value of the US dollar, which was the original main driver of the increased capital expenditure costs.
The investment bank used this delay to underpin its forecast that the PNG LNG project will start first exports in the December quarter of 2014, which compares to the initial late 2013-early 2014 expectation of several years ago.
Exxon is yet to "narrow down" when first exports could occur in 2014, according to a spokesperson.
Despite the noise about the cost blowout, MPW still highly rates the PNG LNG project's economics compared to competing LNG projects in the Australia Pacific region.
Other PNG LNG partners such as Oil Search and Santos have enough capital available to meet increased development costs, while the PNG government could always pursue the option of securing a bank loan leveraged against the future project revenues it will receive from its 19.6% stake and from taxation.
Exxon also recently revealed that the output of the under-construction two-train LNG plant was increased by 5% from 6.6 million tonnes per annum to 6.9MMtpa.
Outside of this marginal capacity boost, investigations are already underway into developing a possible third train.
An industry source told PNGIndustryNews.net that the P'nyang South-1 appraisal well, which hit pre-drill estimates in March, could increase the field's resources by 2.5-3 trillion cubic feet of gas - a potential boost of 33% to the project's overall resources.
The P'nyang field is to the very northwest of the cluster of PNG LNG's highlands gas fields. In October, Oil Search revealed that preliminary studies to use this field as the foundation resource for a third train were underway.
Speculation over a possible fourth train emerged this year too, which is also dependent on further exploration success. In each case an additional train is expected to cater for at least 3.3MMtpa of capacity in line with the original scope of the trains for PNG LNG.
The next hydrocarbon project to hit production is expected to be the Talisman Energy and Horizon Oil shared Stanley field condensate recovery project in Western province.
In early November, Horizon said the required petroleum development licence could be awarded by year-end.
First production has long targeted the end of 2013, although a significant delay to receiving the PDL might push back timelines.
A $300 million project, it aims to produce 140 million cubic feet of wet gas per day to result in the initial recovery of about 4000 barrels of condensate per day using a two-train refrigeration plant in the field.
An interesting footnote to this project is that Toronto-listed explorer Eaglewood Energy has announced that its 65%-owned prospecting licence (PPL 259), which neighbours the Stanley field petroleum retention licence 4, contains part of this field.
Best case estimates from respected consultancy Gaffney, Cline and Associates determined that 32.4 billion cubic feet of gas and 1.1 million barrels of condensate resources from the Stanley field crept into Eaglewood's licence.
It represents roughly a 9-10% increase to PRL 4 Stanley field resources, which were independently certified to be 361Bcf of gas and 11.4MMbbl of condensate earlier this year.
Eaglewood announced in October that the Department of Petroleum and Energy requested that "unitisation arrangements" between the two licences be made before it awarded a PDL to the PRL 4 joint venture.
Horizon, which bought a 25% stake in PPL 259 from Eaglewood for $2.5 million in January, has not revealed much about this particular issue in its announcements so far or changed its forecast of receiving a PDL by year-end.
On the back of drilling success this year, Horizon and Talisman are also pursuing a separate condensate recovery project for their Elevala and Ketu fields in Western province's PRL 21, which they also share with Kina Petroleum.
Timeframes are yet to be unveiled but such a project will be similarly designed to the Stanley condensate recovery project, which will eliminate a lot of time-consuming engineering work.
In April, Horizon chief executive officer Brent Emmett told PNGIndustryNews.net that PRL 21 had an even better condensate yield of about 60 barrels per million cubic feet of gas compared to 30bbl/MMcf in PRL 4, with the Stanley project prioritised only for logistical reasons.
In what is a project in the making, Eaglewood lined up Switzerland-based commodity trader Trafigura in October to finance development of a condensate production facility for the Ubuntu field discovery it made in Western province in 2011.
Like the Horizon-lined condensate projects, Eaglewood plans to pipe the condensate out to river tankers for export down the Fly River but there are no capex or timeline estimates at this stage.
The next suite of more advanced hydrocarbon projects in PNG are based on varying proposals to commercialise InterOil's Elk and Antelope discoveries in Gulf province.
By the time of publication, InterOil, the PNG government and potential buyers for at least one stake of this field were in negotiations.
Both InterOil and the PNG government envisioned a 7.6MMtpa conventional LNG plant run by a world-recognised LNG operator near Port Moresby in their late 2009 project agreement.
Later came a separate InterOil-led project to develop a condensate stripping plant for the Elk-Antelope field with Japanese conglomerate Mitsui.
Yet development strategies have changed so markedly since then that InterOil is most recently targeting a 3.8MMtpa LNG plant capacity in Gulf province.
This is based on exploiting half of the Elk-Antelope field, while the government has signalled it wants to buy an additional 27.5% of the field from InterOil, at a mutually agreed price, to own the other half.
Prime Minister Peter O'Neill flagged a second LNG plant in what he called the 50:50 Gulf LNG project agreement.
There isn't much clarity on how the condensate stripping plant project fits into this equation but both the government and InterOil have flagged a new gas-to-electricity development.
While unfortunately it is sufficient to say "watch this space" as far as project timelines are concerned, it is possible that first LNG exports from an InterOil development could be in 2016 or 2017.
Then again, a lot depends on the yet to be determined approach used, such as whether it will be a modular, conventional or even floating LNG development. There is also the unknown factor of what established LNG player could buy an operating stake of this field. All that is on the record at this stage is that InterOil chief financial officer Collin Visaggio has confirmed that at least two supermajors have made bids.
While this wraps up the progress on official petroleum projects in the country, it should be noted that successful exploration campaigns could generate more LNG projects in the next few years.
These could be based on Oil Search and supermajor Total SA's onshore and offshore Gulf acreage, the Talisman-led gas accumulation strategy for a bag of Western province licences and entrepeneur Clive Palmer's massive offshore licences southwest of Port Moresby.
In regards to Talisman's strategy, which was boosted by the $280 million farm-out deal it struck with Mitsubishi in February over various stakes in nine licences, Horizon - its key JV partner in the region - has already foreshadowed a "mid-scale LNG" opportunity.
"Perhaps the most significant technical achievement of the past year is that we have now established a gas resource in PNG, independently audited, of 1.3 trillion cubic feet and this presents a good foundation for a mid-scale LNG project," Horizon chairman Fraser Ainsworth said at the November annual general meeting.
Ainsworth further revealed that Horizon had attracted strong interest from substantive "LNG industry players" over its plans to partially sell a slice of its PNG assets to a new participant - indicating that a company even bigger than Talisman could be in the running.
Horizon also has considerable domestic market options to supply gas or LNG for power generation purposes at the Ok Tedi mine or for the Xstrata-led Frieda River copper-gold project, where the feasibility study was delayed until December 21 to investigate this option compared to the benefits of a hydropower development.
In contrast to PNG's intriguing petroleum scene, mining players in the country are modestly racking up the milestones.
The long-heralded Million Ounce Plant Upgrade project at the Lihir gold mine should be completed before the year is out.
Started back in the days of Lihir Gold, Newcrest Mining discussed even further expansion during its AGM in October.
Newcrest chairman Don Mercer flagged more investment to lift Lihir's production to 1.2 million ounces per annum, while a separate slide from an associated presentation revealed that planning was continuing on a 1.4Mozpa outcome.
"Lihir offers many options to extend the life of the mine for decades into the future," Mercer said.
"Lihir is an exceptional asset with significant upside. It is one of the world's largest gold deposits."
At PNG's giant Ok Tedi copper-gold mine, design work confirmed in March that its mine life extension project could support an additional four years up to 2025.
Production under the extended mining plans is expected to vary by either matching the current rate - which amounted to 130,456 tonnes of copper and 419,249 ounces of gold in 2011 - or to reach 60% of this output, according to Ok Tedi Mining Limited estimates at the time.
"In the years 2016-2020, OTML expects only modest revenues compared with revenues generated under current operations," the company said.
Yet the smaller revenues remain significant to PNG government coffers and OTML was still in the complicated phases of gaining community and government approvals by the time of publication.
Keeping in line with the ongoing work at existing PNG mines - and while it technically isn't a project but could arguably be considered of a project scale - the Hidden Valley gold and silver operation in Morobe province is busy ramping up to its intended capacity.
The country's newest mine, Hidden Valley had a setback within months of starting production when a belt on its overland conveyor failed in March last year. This forced the operation to truck ore to its processing plant while repairs were made.
In achieving a ramp-up to its gold nameplate capacity of 250,000ozpa, the mine will need to more than double its production based on its September quarter output of 22,137oz, which was an annualised rate of 88,548oz.
Yet it's not all bad news for the Morobe Mining Joint Venture which owns the mine (50:50 Harmony Gold and Newcrest), as its Wafi-Golpu copper-gold project in the region continues to captivate industry observers.
Drilling of the Golpu deposit in the September quarter hit a combination of scope and grades that the majors dream about.
While it was deep, which doesn't matter as much because block cave mining is already flagged for this deposit, the standout drilling result intersected 942m at 1.18% copper and 0.94 grams per tonne gold from 1038m down the hole.
Importantly, this result included a 340m intersection grading 1.91gpt gold and an exceptional 2.35% copper from a depth of 1246m.
To put this in perspective, there are various copper projects around the world which are based on about 0.5% average copper grades.
The Golpu prefeasibility study was unveiled in late August.
It presented the case for a $4.8 billion, two-lift block cave operation that produces an average of 400,000ozpa gold and 250,000tpa copper in the first 15 years of the 26-year mine life.
It anticipated a peak annual production of 550,000ozpa gold and 330,000tpa copper during that time.
This scenario boasts first production in 2019 with a 26-year mine life based on reserves which equate to 12.4Moz of contained gold, 5.4Mt copper and 19.7Moz of silver.
But exploration is ongoing and the JV has flagged the possibility of an expanded three-lift mine with a 30 year-plus life along with production of 580,000ozpa gold and 300,000tpa copper.
This would peak at 720,000ozpa gold and 380,000tpa copper.
Then there are the compelling economics, with both Harmony and Newcrest calculating a different set of negative cash costs.
Newcrest used assumed metal prices of $1250 per ounce of gold and $3.10 per pound of copper, equating to unit cash costs of negative $2150/oz and unit production costs of negative $1200/oz.
Harmony's numbers use a gold price of $1650/oz and a copper price of $3.50/lb to arrive at gold cash costs of negative $2600oz and copper cash costs of 54c/lb, net of by-product credits.
These results are also far from the full story, as the initial studies are yet to be complete for the nearby Wafi deposit, which is within open cut minable depths.
MMJV will start a feasibility study over the Golpu deposit next year.
The Wafi concept study is expected to come out in the coming months.
The combined Wafi-Golpu resource is 28.5Moz gold and 9.06Mt copper but an exploration target of 40Moz and 15Mt copper remains in play as the JV hopes to find a cluster of Wafi-style copper porphyry deposits.
While Wafi-Golpu is starting to generate the equivalent of a PNG LNG-sense of excitement for the mining scene, Marengo Mining's Yandera copper-gold-molybdenum project is another future world-class operation in the making.
Perhaps the biggest news for Yandera this year has been the various delays to the announcement of its long-awaited feasibility study.
However, this was due to surprisingly good results from infill drilling around the project. A series of 100m-plus intersections were struck that generally doubled the existing resource grades of the project.
What's more there were quite a few results within 50m of the surface. A couple of standouts include a 165m intersection grading 1.08% copper and 381 parts per million molybdenum from a depth of 42m and a 270m intersection at 0.8% copper and 264ppm moly from 87m down the hole.
The project has long targeted production of about 80,000-100,000tpa of copper plus 15,000t of moly in a concentrate form over a mine life of 20 years, with first production in 2016.
Yet there is scope to either extend the mine life or expand production going by the steady rate of drilling success.
"We think 20 years is really just a starting point," Marengo investor relations vice president Dean Richardson told PNG Report in October.
"But we also think the potential is there to double the train [production capacity] over years five and six.
"It needs to be supported by ongoing drilling results. We have already got mineralisation going down to a kilometre but the current resource estimate is only down to about 500m.
"We're pretty comfortable there is plenty more there."
In regards to project financing, Marengo struck a memorandum of understanding agreement with China Nonferrous Metal Industry's Foreign Engineering and Construction Company in 2010.
This arrangement could ultimately usher in Chinese financing of 70% of the estimated $1.8-2.06 billion development cost.
As for that feasibility study, Marengo managing director Les Emery told shareholders at the November 8 AGM that it was "imminent" and hopefully it has been received by the time this edition arrives in PNG.
The other large mining project, the Frieda River project near the border of West and East Sepik provinces, has become more shrouded in mystery since Xstrata Copper signalled intentions in June to possibly sell its 81.82% stake.
The 2010 prefeasibility study was based on a $5.3 billion mine with a 20-year life, producing 930,000tpa of concentrate containing 246,000t copper and 379,000oz of gold in the first eight years.
As discussed earlier, the feasibility study was delayed until four days before Christmas to best assess possible gas-fired electricity options and the findings could ultimately determine whether a suitable new partner comes along or not.
It's important to note that Xstrata is not guaranteed to make a deal over its massive stake in the project.
The words of an Xstrata Frieda River spokesperson mid-year are likely to remain relevant today.
"No decision has been taken yet and this could result in a full divestment of our 81.82 per cent interest in the Frieda River project, a partial divestment or no divestment at all," the spokesperson told PNGIndustryNews.net.
Yet there are some fans of the project in PNG.
In October OTML managing director Nigel Parker told Radio Australia the project was like Ok Tedi 30-odd years ago.
"We cannot let this asset die, otherwise the Papua New Guinea nation loses out," he said on air.
The comments followed PNG Sustainable Development Program's move to acquire a 13.04% stake of 18.18% Frieda River project owner Highlands Pacific through a share placement in June.
PNGSDP owns a 63.4% stake of OTML and it wasn't clear at the time whether the purchase was motivated more by Highland's Frieda River stake or this explorer's wholly owned Star Mountains project, for which a whopping 586m intersection grading 0.61% copper and 0.85gpt gold was announced in May.
In any event, both projects are in the same general region OTML is accustomed to, with the Star Mountains project 20km to the northeast of the Ok Tedi mine while Frieda River is 75km northeast.
Highlands is also an 8.56% stakeholder of the $1.5 billion Ramu nickel cobalt mine in Madang province, which finally loaded its first export shipment in November.
Ramu is a wet nickel laterite mine developed by China Metallurgical Construction Company (85% owner). The shipment milestone came essentially two years after construction was finished, with legal challenges to its deep sea tailings placement infrastructure only coming to an end just a few days before Christmas last year.
Commissioning work for the three high-pressure acid leach autoclave circuits has continued throughout the year with full production at the rate of 31,150tpa nickel and 3300tpa cobalt expected in mid-2013.
While PNG has the kind of resources to support major mining operations, some of the projects that were smaller and quicker to get off the ground were ticking the boxes this year.
Kula Gold's Woodlark Island project could be the next PNG mine, with a mining lease application made in October.
Targeting first production in the first half of 2015, the feasibility study completed in September found the proposed open pit operation could produce 813,000 gold ounces over a nine-year mine life.
With estimated cash costs of $730 per ounce over the first six years, the project is estimated to earn enough to pay back its life-of-mine capital cost of $212 million within 2.6 years, based on a $1600/oz gold price.
There is also scope for expansion on the back of more exploration success on the tenement, which encompasses the entire 70km-long by 20km-wide island.
Vying for the spot of PNG's next gold mine is Indochine Mining's Mt Kare project which is located just 15km southwest of Barrick Gold's major Porgera operation.
The project is also targeting first production in 2015, with the prefeasibility study completed in October. The proposed open cut mine aims to produce a total 1Moz gold and 8Moz silver production over an 8.5-year mine life.
But there could be plenty of scope to further expand or extend this initial case with Indochine regularly releasing a series of strong drilling results over recent months.
The standout so far was a 38m intersection grading 20.8gpt gold from 78m down the hole. This included a 5m interval at a bonanza grade of 120.1gpt gold.
Another interesting and smaller scale project is Coppermoly's Nakru-1 project on New Britain Island.
The conceptual mining study completed in September found that this deposit could produce 19,200tpa copper over an eight-year life with a return on investment possible within two years.
An immediate issue is what Barrick might do with the exploration licence. The major miner finished earning a 72% stake in each of Coppermoly's Nakru, Simuku and Talelumas projects on the island early this year.
Barrick has since tried to sell these stakes and in November Coppermoly was seeking to raise the necessary funds to potentially buy them back.
Perhaps the biggest setback for the year was Nautilus Mineral's November decision to shelve its innovative seafloor mining Solwara-1 copper-gold project in PNG's Bismarck Sea, a subject covered in a separate story in this edition.
Otherwise, 2012 has mostly been a good year for PNG's mining and petroleum scenes.
PNG Chamber of Mines and Petroleum executive director Greg Anderson spoke to PNG Report ahead of its 12th Mining and Petroleum Investment Conference in Sydney.
"The bottom line is that all the projects have progressed substantially since [the] end of 2010," Anderson said, referring to the chamber's 12th conference, also held in Sydney.