Planned PNG law changes likely to need further discussion: Radio NZ

Papua New Guinea’s new government has moved to quell concern about proposed changes to rules governing ownership of resources in the country.

Earlier this month, the new mining minister Byron Chan proposed legislation to hand control of resources below the six-feet underground mark from the state to customary landowners.

It has caused an outrcy within the extractive industries.

The Prime Minister, Peter O’Neill, has since clarified that parliament is yet to fully discuss the changes.

Johnny Blades has more:

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A senior figure in the recently ousted Somare government says a lot more work needs to be done before the new administration’s proposed changes could be considered valid.

Madang MP Sir Arnold Amet says present legislation has already enabled government and landowners in PNG to acquire equity and progressively greater participation in the developments. He says the proposed changes are risky and misinformed.

“They rushed into making a policy statement that hadn’t really been considered. It would change the goalposts fundamentally. And that is something that needs a lot of thought before you could even contemplate talking about it or even talking about it. It sends the wrong message to our investors, to the extractive industry.”

The Managing Director of PNG’s Investment Promotion Authority Ivan Pomaleu has reassured foreign companies and developers that the country is a good place to invest in.

He admits genealogical issues remain a key challenge to the resource extractive industry.

“Determining who the rightful owners of the land are, and sometimes that can be subjected to all kinds of disputes. Once those are cleared it’s a simple matter of getting investments through. We advocate a little bit of patience on the part of developers; (The) Papua New Guinean make-up is such that they will raise issues but the bottom line is they will support investment. They (landowners) just want to make sure like anyone else would in anywhere else in the world, they want to make sure that their own benefit streams are clearly defined.”

Whether one is directly enjoying benefits from resource development dictates how Papua New Guineans view the extractive industries, according to Southern Highlands NGO worker Isaac Bulube.

He’s unsure whether gaining benefits from developments like the LNG project is as important to PNG’s mainly rural-based population as preserving their traditional way of life for the future.

“People who don’t get any benefit from the project say we don’t like it but people who are benefitting like in terms of some employment or some payment for the land use or something like that, they say LNG is good. People are not really sure but people who are interested say we don’t know what will happen in the future, how this thing will develop our community and place, and how far it will bring development in terms of our livelihood change.”

However the issue of ownership runs deep with communities throughout PNG which is currently enjoying a resources boom.

But with many ordinary people yet to see any tangible benefits from the development rush or improvement in basic services, pressure for some change to the rules governing resources is likely to grow.

27 Comments

Filed under Financial returns, Papua New Guinea

27 responses to “Planned PNG law changes likely to need further discussion: Radio NZ

  1. The suggestion to push the proposed Policy for more discussions is the norm.Democracy ensures capacity building and making the grassroots aware of these issues.The ownership reversion is righting the wrong.This will be a great sign of Independence from colonial past.The state inherited Colonial expropriated resources without compo negotiations and its only fair and just to revert a long overdue political will.PNG is so blessed that now in the 21st century a Government isn’t mincing its word on resource ownership. Reversion of ownership will not hinder the industry but will boost the economy with fair distribution via market forces.

  2. James

    Pere
    Do you object to the the natural wealth of PNG being held by the State under the Constitution for all of the peoples of PNG?

  3. Nathan

    You MRA all corrupt…come and steal birth and land right anmd pratend to speak for landowners to companees and never do a good job fo pleaple.
    You mob in morseby are same just look at yorselves and think about your selv.
    I say buger you

  4. j kross

    Radio NZ seems so keen on PNG’s internal affairs. What is the arrangement in NZ when it comes to land and mineral resources. They have the Maoris and Anglo Saxon settlers who may have reached some form of agreement on how to manage their natural resources. Do the Maoris have the right to the mineral resources since that was their land, originally? Anyone? Or is it all sheep and no minerals?

    • Wesley

      All sheep?
      No, but there are a lot of them.
      They have embraced the notion of communality and rights to minerals in the ground are there for the Nation as a whole

      • j kross

        Thanks Wesely. Just checking to see if Kiwis have had enough and want to change all that to enrich a few. Why then does Radio NZ think what’s good for them is bad for us (minus the corruption in PNG of course)?

    • johnny

      Why do you think Radio NZ is even advocating one view or another about how to manage PNG’s resources? JKross, you seem to be inferring something that’s simply not there. It’s just a current affairs piece, looking at some of the salient points in this issue.

      Why is Radio NZ interested in PNG’s affairs? Well my guess is that some parts of NZ are interested in finding out about international news. And lets face it, PNG’s a very interesting and important part of the Pacific region which NZ is in too.
      When I was in PNG recently I read lots of stuff about NZ in the two daily newspapers. Nothing wrong with that is there?

  5. James,
    The ownership of resources by Governments is an act of colonialism.Independent govts therefore should be politically willing to revert ownership-so that we can be truly say .If PNG Govt wants than to nationalise these “once communally owned” resources than after acknowledging the reversion than it should negotiate at a level playing field with the landowners.
    Therefore it must be clear that colonialists ursurped these mineral rights for betterment of the nation without any redress/compo for landowners.Its all the same colonialist wrong that happened in Africa,Australia,Fiji and PNG.That’s why corruption is rife at national levels/politicians because they now control wealth that’s not rightly theirs.Where are the landowners?How prosperous are they due to such legislations.

    • Get the facts right..................................

      Pere
      Change comes.
      You have to accept this.
      No point in looking back to the past.
      So it is irrational to refer to acts of colonialism in this context.
      PNG became a nation in exchange for the surrender of mineral rights to ALL of the peoples of PNG.
      You don’t seem to grasp this issue.
      You say on the one hand that the usurpation of mineral rights was for the betterment of a “nation”.
      Then, in the same sentence, you claim that compensation is required to land owners for the act of colonialism.
      In that vein of logic is it not the case that the owners of mineral rights should therefor pay the other peoples of PNG for any of the benifits of former being in a nation?
      Is that what you are suggesting?
      You also seem to not undertsan the nature of mineral resources but only look at the numbers.
      Mineral resources are generated by enormous amounts of cash.
      Not just the fact that there are higher than normal volumes of a particular element in the ground.
      Its the cash that is the RESOURCEs as much as what nature is provioding.
      Now its simplky the case that Land Owners don’t have access to that cash componant of the resources.
      This is what needs to be made very clear, without the cash there is no resource.
      the reason why there are resources

  6. Tom Pauling

    Pere
    Which colonialist will be disenfranchising the ordinary peoples of PNG ?
    When Chan takes away common sufferage and the Nations assets and give them to only a few…..is that not an act of profound iniqity and oppression by a colonialist regiem?
    You need to get this right historically.
    Before “colonialism” PNG was not some utopian place Pere!
    It was a horrible life that people had.
    They woud regulary kill each other, (still do) and raid other tribes for food, and I am not talking about sago, we are referring to long pork.
    Don’t come the historical rewrite with all this Pere.
    Don’t say that some how peoples lives are worse now than before.
    Thats just a tad fanciful.
    Then of course, freeing the peoples from their colonial bonds all of the tribes (ethnocentric communities) of PNG decided they would be a nation, so what did they do?
    They decided that they would do what other nations do.
    They would pool their common resources in a body politic called “The Independant State Of Papua New Guinea” and they would all work together for a new tomorrow.
    How is this some how an act of colonialism?

  7. Pauling,
    Thanks for the history and it is ok with me. I’m more interested on ownership of natural resources and the reasons which led to it being nationalised.
    What do the landowners get for giving up their customary rights to these communal resources.?
    Isn’t it fair that these resource owners be compensated for what they own(God given customary right) which are now utilised/capitalised for national good.?.These resources are once classified as private customary property rights but because of non-governance than Govt than nationalise the same without any compo arrangements to landowners.
    Who benefits from these deals?(the nation and developers)
    What are the proceeds or entitlement of the landowners here-marginally insignificant.
    Therefore the reversion attempt is a step in the right direction. The Govt must acknowledge that resources were once owned communally by landowners before it was nationalised.
    The steps to makeup the reversion should start off with acknowledgement of prior ownership and arrangements for compo arrangements for landowners for giving up their rights.Only after that than nationalisation of resources will be boosted with peaceful dealings and boost in investor confidence.

    • j kross

      We need to fix something here. Right now, as we speak and ACCORDING TO LAW, which law is firmly entrenched in the PNG Constitution, we the 6 million plus people of PNG own all mineral resources under land and sea. Unless that legislation is changed, no individual or group of individuals own any resources below the surface exclusively. Therefore we should not carelessly spew the nonsense about certain people who happen to be geographically located near a potential resource area as “resource owners”. The law does not allow exclusive mineral rights to particular groups (different from customary ownership of land on the surface) and it is unlawful to exclude the rest of PNG as non-resource owners under current law. The notion that only landowners own the mineral resources is wrong under current law. It was a welcome gesture by the colonial powers who in their wisdom placed all mineral resources under collective national ownership through the State than to allow only a few who never really owned anything below six feet, and who had no input whatsoever in the natural process of mineralisation exclusive rights over other citizens.

      • Wesely

        jkross
        What I dont understand is why the peoples of PNG, a new up and coming nation with huge potential, don’t think they own the resources in the ground.
        Its almost as if Chan is attempting to say the the National Government is not the Government of the peoples of PNG.
        (Now, there are issues of accountability here which have led to many people holding just this view, that is, the alienation of the peoples from their own government)
        Nevertheless, what is proposed is not only unlawful under the constitution but may well lead to the destruction of the fundamental fabric of nationhood and PNG will end up like Nigeria or the Congo.
        Thats my biggest concern

      • j kross

        Wesely, if we keep pushing down this road, one of these views will prevail in the end. Either we will strife to unite this nation and share in the mineral resources or we will allocate the resources to a select group and divide this nation. The rest of PNG will wake up to this sooner or later and I fear the consequences. If people want to introduce this law, they first have to remove from people the deep sense of ethnic and regionalism which no doubt will come to play when the new educated masses will read into the proposed legislation and feel deceived and robbed.

  8. Wesely

    jkross
    Me thinks its all a part of the “lets be nice and patronizing (in a nice gentle way) to the people next door” syndrome.
    Its interesting do you not think?
    Because what is presented at each moment of our life is a decision.
    What to do next……………
    We need to make the right choice.
    Go forward or go backward, simply put.
    In NZ’s case they decided to pool their national wealth as a nation and to hold it for the Nation as a whole
    Same in Australia and for that matter almost the entire rest of the world.
    There is some thing profoundly wierd if not outright perverse about a Nation that wants to give its national wealth to private citizens.
    I am not saying PNG is pervese, rather, its probaly not ready for nationhood at this stage if it wants to go Chans way.
    Its a bit like the Soviet Union exploding in the 90’s but far far worse.

  9. j kross

    Patronising they may but I thing its more like cynicism from the outside. Most aliens do not care enough to speak for the whole of PNG. They know that corruption is embedded in the dominating PNG power group, whether as elected reps, bureaucrats or landlords, they tend to scratch each others back and ignore the masses. Whomsoever the law seems to smile upon has their nose in the trough, and this proposed change will make no difference. Only the faces or rather snouts will change.

  10. Wesely

    j kross, yes, I know.
    Its so terribly sad for the common people of PNG who deserve so much more.

  11. knoxx

    I don’t think the whole world is yet free from any corruption while PNG is struggling with every corruption we can name. The Law is neutral, it can work good or it can work bad, it all depends on the intent and motive of person’s advising and driving our public policy makers. Corruption is part of human nature and it is here to state. The only thing we can do is to have controls in place, to manage and to minimise its impact on our society. There is no other way forward but to go back and revisit our own National constitution, the mining laws, Land laws and etc. and do amendments where necessary. Pain is simply the sign of new birth – like the say, PNG is the land of the unexpected. Let’s be positive

  12. Wesely

    jkross
    Existing land owners (including the peoples of Panguna, Wafi Gopu, Hidden Valley, Porgera, Ramu, Yandera, Freida River, Mt Kare, Tolakuma, OkTedi, Sinovit, Simberi, and Lihir (not to mention the Southern Highlanders with oil and gas)) can not expect any joy from what Chan proposes.
    They will continue to support the nation while others receive benifits they are denied
    So existing projects and land owners will be suporting the rest of the nation and in fact will be, in a technical sense, denied what others have.
    The other thing to remember is that the legislation can not be retrospective but if it is the state must compensate the miners.

  13. jkross,

    Isn’t the current law is being proposed to be changed.? To change the law we all know how democracy requires before any Bill is made into law. Therefore we need to propose a win-win for ALL(customary resource owners,Government & Developers)
    These resources once customarily owned(minerals,forests,land etc) as it fall within respective customary land boundary.
    The current land and mining law transfer ownership rights from customary/traditional/native title and nationalized them.
    Its generically an act of expropriation thru law which now need to be revisited and to work out negotiated compo arrangements to facilitate building a better PNG.
    We should build a goodwill foundation for the future and ensure that controversial are resolved amicably now to pave better relations for ALL

    • Wesely

      Pere
      What wrong with the picture is that both the land owners and the developers are relying on the PNG government to do the right thing.
      The real problem stems from the failure and incompetence of the PNG government and its total incapacity to provide strong transparent governance.
      THIS IS WERE EVERYTHING COMES APART !!!
      Developers are much more sophisticated in their approach toward community relations than the government and a lot of landowners are aware of this.
      Environmental matters are generally, again, the fault of the government for failing to properly specify and administer the relevant legislation and provide clear strong and transparent.
      Disputes relating to the distribution of benifits are also in the main the fault of the government who fail to:-
      1. negotiate agreements on just terms:
      2. make appropriate decisions to take up equity in projects in the National Interest;
      3. implement clear and transparent payment schemes;
      4. provide adequate support to develop sustainable secondary industries;
      5. review agreements in accordance with MOA’s.
      Having accomplished their role as a failed regulator the Government then sits there like Dumbo the Buffalo and points the figure at the developers or the land owners or/and often appear to seek to exploit the conflict between land owners and miners (generated by government failure to discharge it obligations to the peoples of PNG).
      This was classically manifest in the former Department of Mines but dsadly, more recently and quite overtly repeated by the MRA.

  14. j kross

    The current laws and instruments already have inbuilt win-win mechanisms in place, i,e, state to distribute goods and services for all without any favoured pets hanging around the kitchen all day. We have it all but are poor where it counts most, implementation. We’ve been writing and implementing MOAs as long as I can remember where LOs have their take with no complaints. I am for all of PNG. Customary owned land yes I agree, mineral rights for locals, no, I disagree. It all belongs to the people through the State. That’s where we differ. You want to create a mine-owning class and deprive the rights of most people, go ahead.

  15. Wesley,

    You are talking restrospective and suggest that miners(Developers) be compensated by the Government.
    That’s the gist of the fracas,mate.
    The customarily landowners need to be compensated for their once owned communal resources was nationalised – which is now the current law.
    I’m not talking about the current ownership but why resource owners before the existing law come into being was denied than.

  16. Wesely

    Pere
    I take your point.
    This is a constitutional issue but I do not think it can be resolved by PNG for the following reasons.
    Firstly, it goes to the heart of the social contract between the State and its people at the time of the founding fathers ratifying the Constitution.
    Some would say the the State of PNG had no right to acquire the minerals in the ground.
    But if that legal issue was determined in te affirmative nevertheless I do not think relief can be found under the PNG constitution.
    This is because PNG at law did not exist at the time of Independance, PNG being a Territory of Australia.
    PNG citizens now were Australian citizens then.
    The remedy, if there is one, I think lays in an action before the High Court of Australia in declarations in terms that there has been an acquasition of property by the Australian Government on other than just terms because at the time of Independance, PNG was a Territory of Australia, and, in accordance with the Federal Constitution of Australia, PNG Customary Land Owners (as citizens of Australia) had inalianable rights to the minerals in the ground in accordance with Melenesian Customary Law (which has never been properly pronounced on bythe High Court), and, that in granting independance and vesting minerals in the ground to the State of PNG the Law and/or administrative action that gave independance to PNG and ratified the PNG constitution itself constituted an acquasition of property on other than just terms and therefore constituted a breach of the (now) PNG citizens rights (then) under the Australian Constitution and when they were Australian citizens.
    It is a difficult and vexing argument.
    If the land ownerns now dispute that they agreed to the terms ofthe constitution they must nevertheless take their claim to the High Court of Australai being the party who has dealt with the property.
    Just a few thoughts here.

  17. Wesley,
    I wholly agree with you and that’s the gist of what I’m trying to bring across.
    The problems that we are currently facing now as a nation of former colonies is bad inheritance-specifically a design of former Australian rule, BUT which can be easily resolved.
    Currently the law nationalise customary resources which is the easy means to fill national coffers, that’s available at the dawn of independence governance of PNG-Guess what,its all typical proposal by advisers from Australia(the fmr central Govt of PNG an Australian State than-same as Fiji which was governed thru NSW during Colonial rule)
    What we need Mr Minister to know that his design should be based on these two pillars:
    1.Proposed reversion design should be comfortable for the beneficiaries(PNG the nation,customary landowners and Developers)
    2. Should be acceptable with both local and international court of law
    As I’ve raised before its not direct reversion per se BUT a mechanism designed to facilitate building of better nation.
    Most of resource laws and policies need stringent revisit now for the future.
    All the Best

  18. Get the facts right….
    1. I agree change is inevitable but it must be fair and just. What is wrong need to be corrected so PNG don’t have to be bothered into the future.
    2.The surrender of mineral rights was a design of Colonialists from customary landowners to the new Government of PNG.Be reminded no compensation for the customary landowners for the expripriation act.
    3.The nation and Governments interest which nationalise the mineral rights is different from the interest of the customary landowners.These are two different interest.The Government is not the customary landowners who were original owners of the minerals per se.
    4. Compensation should be paid by Government to the customary landowners for it nationalise the customary landowners private mineral rights for the perceived benefit(s) of the Nation.
    5. Cash is only generated for development of minerals once mineral rights are issued.Therefore when mineral rights are issued to Developers than go to stock exchange and raise cash from Investors.Without mineral rights there will be no cash injected and no development.The mineral rights issued by PNG Govt had brought in big time Developers/Investors to where the resources are right in the hills of Panguna,Ok Tedi etc.Its not cash that bring them there but the minerals without it there is no cash.
    6.These mineral rights before Independence was a private right which belong to the communal customary landowners BUT thru colonial designed systems have nationalised these mineral and mineral rights.
    7. It must be remebered that the customary landowners interest is different from that of the Government.

    • Get the facts right..................................

      Pere.
      1. Firstly, we have to accept that at independance and nationhood all peoples of PNG surrended any and all claims to minerals in the ground to the state.
      That has happened and must not be overlooked.
      This is what has happened in exchange for the constitution.
      The land owners of PNG have given these rights to their own state in exchange for statehood,,
      No compensation can be claimed in such a case as the claim would be against the peoples of PNG, other land owners, who themsleves would have an equal counterclaim.
      2. The ‘compensation’ (if it can be called that, more an exchange of rights) that the land owners got when they surrendered their rights to minerals in the ground was a nation.
      That the nation has failed to live up to its promise to date is the real issue as I see it.
      That also deals with point 3 and 4 of your advice.
      It does not matter whether you define the process as a colonial change, or prospective constitutional protections in the constitution, the people of PNG chose not to maintain those rights to a claim in the minerals in the ground.
      If the people of PNG then wanted to vest the prospective rights in minerals in the ground to land owners then they should have recorded that in the consitution rather than giving them to the state.
      This was not not done at the time of the passing of independance to the peoples of PNG.
      It is not colonial design which has vested rights in minerals in the ground to the people of PNG.
      It is the people themselves who have decided that this was not the way to go.
      4. You don’t seem to have understood the point I made with respect to you 4th and 6th comment.
      It may cost over 100,000,000 dollars to find the mineral deposits, so with respect you comments in point 5 seem to be errant becauase there are no “mineral resouces until they are discovered, proved up, drilled and teh subject of a feasability and optimization study.
      Before that you just have rocks in the ground.
      Finally, and with respect, I am afraid that you do not seem to understand that customary land owners interest are of a private nature and the states interests are of a public nature.
      But having said that the Constitution did not alienate customary land rights.
      Over 96% of land in PNG is in “private hands” but that has not generated and wealth for those land owners.
      The situation would be no different if minerals in the ground vested in land owners.

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