"We declare our first goal to be for every person to be dynamically involved in the process of freeing himself or herself from every form of domination or oppression so that each man or woman will have the opportunity to develop as a whole person in relationship with others".

- Papua New Guinea National Goals and Directive Principles

Thursday, 8 May 2014

PNG landowners won't be listed before gas flows

by Jemima Garrett Updated Thu 8 May 2014, 10:12am AEST Photo: ExxonMobil's LNG plant in PNG's Southern Highlands is expected to begin its first delivery of gas in June 2014. (ExxonMobil PNG) Audio: PNG gas landowners won't be identified before first cargo says Minister (ABC News) Map: Papua New Guinea The PNG Government says it's confident its method of identifying landowners who will benefit from the nation's billion-dollar liquid natural gas project is fair and valid. The government has been criticised for using a process called 'clan-vetting' to decide who can claim royalties from the $19 billion project. It has acknowledged that the landowner identification process won't be finished before ExxonMobil makes its first shipment of gas to Asia in the middle of the year. PNG's Petroleum and Energy Minister, Nixon Duban, says clan-vetting is thorough and almost complete in nine of the 16 major areas. "While many people may raise the level of criticism against the government's effort I want to assure all our public and general listeners (about) this system of social mapping and clan-vetting," he said. "I think we are a capable government and we will have it completed without any bias to our current delays in terms of release of funding and the commitment by our officers, are minor obstacles in my view and it will be done." The ExxonMobil PNG LNG project - which stretches from the PNG highlands, along a 600-kilometre pipeline to the plant site near Port Moresby - is ahead of schedule. Tens of thousands of people who live within the project area are waiting for the money to flow but that can't happen until all landowners are identified. Traditional owners in all those areas are expecting to receive financial benefits, but the task of identifying who is or isn't a real landowner is fraught with difficulty. More than five years' work has gone into the process, but it is still contested. Stanley Mamu, administrator of the NGO, PNG LNG Watch, says there are problems with clan-vetting. "Anybody from Papua New Guinea can claim their clan as part of project areas, (that) they come from the project areas," he said. "The problem that will cause for the future is that is not a proper identifying of that clan so anybody working with the Department of Petroleum and Energy can put his clan into that clan-vetting and claim that he is the landowner and he will get benefits from that project." Lawyer Alfred Kaiabe, an oil and gas expert from Hela province, in the PNG highlands, says the clan-vetting system has no legal basis. "There are a lot of problems associated with it," he said. "During the last two weeks there have been commotion down at the Petroleum and Energy Department because some of the landowners want to know the outcome of the clan-vetting the government has been conducting." Royalty money held in trust The final, official list landowners who will benefit from the project will be contained in a ministerial determination. Mr Duban says it is important the information that goes into the ministerial determination is correct. "We must ensure and there must be internal reviews from time to time to ensure that this clan-vetting is true and true and correct in all forms," he said. Mr Duban said he expected the clan-vetting to be 90 per cent finished before the end of the year. Until then, the PNG Government will hold the money in trust. Prime Minister Peter O'Neill is expected to reveal details of how that process will work when he tours project sites in the coming weeks.

Monday, 14 April 2014

Exxon to Export LNG from PNG by Mid '14

by Zacks Equity Research Published on April 10, 2014 U.S. oil and gas giant ExxonMobil Corporation (XOM - Analyst Report) has announced that its long delayed Papua New Guinea (PNG) liquefied natural gas (LNG) project will start exporting LNG by mid 2014. The PNG LNG project is on track and will commence operations ahead of schedule and below its $19 billion budget. The project has brought online a gas conditioning plant in PNG’s highlands. The gas is drilled at the site and a 292-kilometer (180 miles) onshore pipeline has been placed. The first of the two units at the LNG plant are also ready. First cargoes, which were earlier anticipated by October, are now expected by mid year. By the year end, the project will be fully operational. The project, which has been under construction for the past five years, got continuously delayed due to record wet weather, steep terrain and community issues. These resulted in slowing down of the work and escalated the costs by about 25% from its original budget of $15 billion. The most difficult part was the construction of a high pressure gas pipeline above ground that had to be later covered with 1 meter (3 feet) of dirt to conceal it for safety and security. A spot cargo is likely to be the first shipment rather than PNG LNG’s Japanese, Chinese or Taiwanese customers, who have contracted to take 95% of the LNG plants 6.9 million tons of annual gas production. ExxonMobil and its partners – Oil Search Ltd, Santos Ltd, Japan’s Nippon Oil Corp, the PNG government and local landowners – are planning to expand the plant. The decision regarding where to source the additional gas supply for the expansion is yet to be taken. Preferably, the partners want to take the gas from PNG’s biggest undeveloped fields Elk and Antelope controlled by another PNG company – InterOil Corp – and France's Total SA (TOT - Analyst Report). ExxonMobil carries a Zacks Rank #3 (Hold). Other stocks worth considering in the industry include Range Resources Corporation (RRC - Analyst Report) and Helmerich & Payne, Inc. (HP - Analyst Report), all with a Zacks Rank #1 (Strong Buy).

Wednesday, 23 October 2013

Forgotten man of PNG politics reflects on political impasse

Radio New Zealand International 08:36 on 23 October, 2013 UTC A former top Papua New Guinea politician says he had to go against the traditional Highlands mould of character and behave in a passive manner in order to prevent bloodshed when his government collapsed. Sam Abal was Acting Prime Minister in 2011 when the majority of MPs controversially ousted the Somare government and triggered a political and constitutional crisis that only ended with the outcome of last year’s general election. Mr Abal, who lost his Wabag seat in the election, was detached from much of the bitter fighting between the two groups claiming to be government during the impasse, choosing to remain neutral in parliament. He spoke to Johnny Blades about the impasse but began by saying his legal petition claiming the Wabag election result stemmed from bribery and undue influence is still in the courts. SAM ABAL: It is a case where it happened that way and everybody in my electorate knows what happened during the elections, but unfortunately we have a feeling in this country that we should just leave these things and go on, cover it up and it’s all right, let’s continue on. Like what’s happening with the issue that happened during the impasse. The impasse happened because the constitution was broken. The leaders that broke the constitution wanted to change the government by breaking the constitution. JOHNNY BLADES: Did you feel that you were the scapegoat in a way? It can’t have been easy trying to hold things together as acting Prime Minister. Plus, you had Don Polye trying to take the National Alliance leadership and it was difficult on a number of fronts for you to have to juggle all these interests, I suppose. SA: My role there was more or less to keep the peace. I did not want to upset. There was so much going on that people seemed to be reckless and careless. People were jostling for power and money and all these kinds of things. The countries in the world have turned into difficult places with upsets and other things that come up. PNG is a young country at the verge of trying to unite all the different tribes, the thousands of tribes. And the handling of that, to me, was very important, otherwise we would end up fighting on the streets and the tribes would take sides and breakdowns would happen easily, so that’s why I realised I had to play neutral all the way. The breaking of the constitution, I couldn’t agree with, but I just kept quiet and let it roll right through and I ended up sitting in opposition after the dust had settled. I think it’s very important that I played in a passive manner, despite the fact that I come from that area (Enga) where you don’t take things lying down. JB: The National Alliance seems to be growing again. Would you go back in? SA: The executive or the president at that time decided to sack me while I was still Acting PM of a government that was a National Alliance government. I said ’Look, it doesn’t happen anywhere in the world. It’s a joke. Now you have stated the case for breaking up the party’. So that’s when it all happened. Now, I am out of the party but if I win the court case (and get back into parliament) I could possibly return to the party. JB: Since you lost your seat in the election, what have you been doing? SA: I’ve spent most of my life in public service. Straight from university I took up a job with the Foreign Affairs in the late 1970s, early 80s, and from there I’ve always been with the public service until serving overseas and then back as Trade and Industry secretary, and then frmo there I went and served as one of the administrators in the provinces for four years, and then became an MP. So all my life has been public service and I have neglected my family for all this time. So now I can spend time with my family and that’s what I’ve been doing this year, sorting out my family. And also, when I was an MP and an administrator in the provinces, I handled money and signed cheques and all this so I never did any business. I have always believed that if you’re in politics, there are all these issues about corrupt practices and everything so I never wanted my name to be involved in all that so I decided never to do business while I was in politics. JB: So you’re not rich like all those other MPs? SA: No, I’m not. I have my own house in Moresby which I bought before I was an MP. I was a secretary for a department and all that so I’ve earned my keep over the years. But I’m not as rich as... what you call dirty rich the way some go about this. I don’t want to be like that. Now, for the first time, I’ve set up one or two companies to start to work and look after my family, try to tap into the opportunities that are available here in the country now. So now that I’m out of politics, I feel free, I feel I’m not inhibited in any way so I can run my business and help my family out. JB: What do you think of how the current government is running the country? SA: There are some good things that are happening now - opportunities in business and for economic growth. But they are part of things created by our government, for instance the signing of the LNG Project and bringing all those investors in. we were a government that brought the country out of serious deficit. There are a lot of positives coming out of all that now. But government has to ensure there is no over-expenditure. Last year and this year, we were in the deficit in the budget. Small and developing countries always need to keep a balanced budget. The Treasurer, Don Polye, seems to be doing a good job in managing the deficit and not over spending. But government as a whole must continue to manage things carefully in case of a downturn. The kina rate has gone very low now and the Bank of PNG says it’s just a short term thing and that it will be okay, but it shows the fact that at any time we are a very exposed economy and can’t be careless in managing our economy. The LNG Project cash should start to flow next year but between now and then we have to be careful not to make any serious mistakes in terms of any borrowings. It’s no good to borrow before you have the gas flowing, it’s not wise. My only concern is for government to put in place legislation and administrative and budgetary provisions to fight corruption strongly. That’s the main thing we need to sort out, our governance. So much money comes in (to PNG) through things like the LNG project that people lose their head. Unless we have strong governance rules and transprency, we could still fail. Peter O’Neill’s government has an absolute majority and has extended the period when motions of no-confidence can’t be tabled against it to something like 30 months. So this government has the grand opportunity to set down legislations for governance and transparency which no other government in the past had, and I would wish that Peter O’Neill does that. Before the gas money starts to come through, they have an excellent opportunity to get this right.

Friday, 4 October 2013

Exxon secures extra $1.5 billion financing for PNG LNG

PERTH | Fri Oct 4, 2013 8:00am IST (Reuters) - Exxon Mobil (XOM.N) has secured an additional $1.5 billion in debt financing for its $19 billion Papua New Guinea liquefied natural gas (LNG) project, its project partner Oil Search (OSH.AX) said on Friday. The $1.5 billion in supplemental financing will help cover overruns at the 6.9 million metric ton (1 metric ton = 1.1023 tons) per year LNG development, where costs climbed to $19 billion from $15.7 billion late last year. PNG LNG remains on track to deliver its first LNG cargoes in 2014, Oil Search said. Partners in PNG LNG, led and operated by Exxon Mobil subsidiary Esso Highlands Ltd, include Oil Search, National Petroleum Company Papua New Guinea (NPCP), Santos (STO.AX), JX Nippon Oil & Gas Exploration, Papua New Guinea's Mineral Resources Development Company and Petromin PNG Holdings Limited. The PNG LNG project is Papua New Guinea's biggest-ever resources development and could lift GDP by 20 percent. (Reporting by Rebekah Kebede; Editing by Jeremy Laurence)

Wednesday, 18 September 2013

PNG govt under fire

From THE NATIONAL Mon 16 Sep 2013 PORT MORESBY, PNG --- Concern was raised in Parliament last week over the haste in approving multi-million kina projects such as the PNG LNG project without careful evaluation of its benefits to the Government and people. The debate was sparked off by a ministerial statement on the petroleum and gas industry from Minister for Petroleum and Energy William Duma. Attorney-General and Justice Minister Kerenga Kua said the Government would soon amend legislation to ensure that all resources were fully owned by the State. Kua said the State owned resources under the ground but that ownership was transferred to the developer or investor as soon as a development licence was issued. “The state should be owning the resources and not giving them away to investors,” he said. “This is a property shift and payment shift. We get nothing out of it and this is unacceptable and we must constitutionalise ownership because there is no provision confining state ownership. This must take place quickly and must be seen on the benefit we share.” There was concern by some MPs that the PNG LNG project was rushed and sold cheaply and urged the State to suspend all negotiations on new petroleum and gas projects. Minister for Commerce and Trade Richard Maru said the country would only receive K1.5 billion (US$610.8 million) in revenue from 2015 while the Government had incurred a lot of commitments. He said the Government had given away many fiscal incentives, leaving it with nothing, and should not rush into any more projects of such magnitude. “We should get far better package for our people. Let’s see the lesson learnt and make improvement in other (future) projects,” he said. Koroba Kopiago MP Philip Undialu said the state should not engage foreign consultants as it did in the PNG LNG project because their report would not be in the best interest of the State and the people. Goroka MP Biri Kimisopa said the PNG LNG agreement was presented to parliament so that every member had the opportunity to know its content such as the fiscal incentives in the agreements. “Time will only tell us if we have done the right thing,” he said. Meanwhile, Prime Minister Peter O’Neill says the future looks bright for Papua New Guinea and it is cause for celebration. “As we celebrate our 38 independence anniversary, there is cause to be optimistic about the future,” he said in his Independence Day message. “Although we have travelled far as a nation in 38 years, we have not travelled far enough. “Massive challenges lie ahead of us. We have a population that is growing rapidly. We have roads, air and sea ports, schools, hospitals, and barracks we must rebuild or expand. “But I believe that we have laid the foundations for change in the policies that we are implementing. “In 12 months, we have begun the work to rebuild our country’s infrastructure, and improve service delivery. Our economy continues to do well, and this growth will double when the LNG project starts exporting in the latter part of 2014.” He said state-owned assets would be restructured to give more financial security when the Kumul structure was approved by Parliament. “This re-aligning of our assets will unlock the potential that we know these assets are capable of delivering. “So, I can assure you all that the future looks bring for all of us, and there is reason to celebrate,” he said. “But let’s celebrate in peace, with respect for our neighbours, and in the true spirit of independence.”

Thursday, 12 September 2013

ExxonMobil picks Wood Group for engineering on Papua New Guinea LNG

07.23.2013 | Under the contract, Wood Group PSN will provide brownfield engineering and procurement support to ExxonMobil's operations in PNG, including construction and maintenance services to both the Hides gas conditioning plant in the highlands, and the LNG plant northwest of Port Moresby. Keywords: By IAN WALKER LONDON -- John Wood Group said its unit Wood Group PSN has been awarded a contract by Esso Highlands, a subsidiary of Exxon Mobil, to provide engineering, procurement, construction and maintenance services to support its Papua New Guinea (PNG) LNG operations. Under the contract, Wood Group PSN will provide brownfield engineering and procurement support to ExxonMobil's operations in PNG, including construction and maintenance services to both the Hides gas conditioning plant in the highlands, and the LNG plant northwest of Port Moresby. The contract is effective from August 1,2013. Financial terms were not disclosed. Dow Jones Newswire

Sunday, 1 September 2013

Fijian workers to work in PNG Gulf province

Publish date/time: 30/08/2013 [12:55] Story by: Filipe Naikaso Expect some workers from Fiji to be working in Papua New Guinea after the biggest Liquefied Natural Gas (LNG) was discovered in the Gulf Province. This is after a first ever province-to-province sistership deal was signed between the Ba and Gulf province. Fiji’s High Commissioner to Papua New Guinea Romanu Tikotikoca said they had approached the Governor of the Gulf province, Havila Kavo for people from Fiji to work in the Gulf province when the Liquefied Natural Gas project begins. Tikotikoca said they had approached the Cakaudrove province to be in the province-to-province sistership deal but they were not interested. According to Tikotikoca, the Ba and Tavua provinces accepted the offer which will lead to Fijian people working in the Gulf province soon. There is an audio file attached to this story. Please login to listen. He added their main aim is to strengthen the relationship between the two provinces.