The State should forget about buying equities into any mining and petroleum investments or any other natural resource developments in the country while it continues to allow for sale of raw natural resources for quick cash.
Outspoken resource and greater equity participation for PNG in resource development Simon Ekanda said PNG continues to be a cheap haven and investment destination for foreigners whereby they can come in and exploit and explore cheaply.
“This is not right for PNG. The current policy regime regulating natural resources especially mining and petroleum must be changed forthwith. Its about 40 years now and the way we having been doing our business with foreigners has become a laughing stock for outsiders knowing that their return for any investment is unrealistic without having to have any hurdles.
After any investment agreements signed with the State, they (investors) laugh all the way through knowing that what they got (equity interest) is extravagant or more than what they would be rightfully entitled for,” Mr Ekanda who is awaiting a decision from the National Court challenging the PNG LNG Project Agreement said.
“If PNG continues to sell all its natural resources in raw form for cheap cash and also sells even its assets and State-owned profitable companies like Orogen Minerals for cheap deals, then the State should forget about even buying equity in new projects because it’s costly,” the chairman of the Tuguba Landowners Association said.
While making reference to the UBS loan saga, Mr Ekanda also cautioned that people who are accusing Prime Minister Peter O’Neill over the recent UBS Loan must think twice because he is dealing with an inherited and chronic issue.
“The issue has roots embedded in the Orogen Mineral deal and the State’s 18% shares in Oil Search and the subsequent mortgage of these shares to borrow from IPIC.
“If Orogen Minerals was not sold, PNG’s borrowing to finance its equity in the PNG LNG Project would have been cushioned by the financial strength of Orogen Minerals and therefore would have been much easier. If Orogen had any life in it in Oil Search, then it took its last breath when the State mortgaged its 18% interest in Oil Search,” Mr Ekanda said.
He further highlighted, “PNG continues to borrow not because it is a poor country; it borrows because it does not know how to convert its abundant natural resources into tangible wealth, including stockpiling physical gold in the country.
“Unless prudent economic management tools are embraced, including spending in most needed areas, PNG will be a reckless spender while on the other hand, and white-collar crime will strive as a robust business. We have a serious problem,” he added.
“What concerns me most is not the UBS Loan but the factors which make PNG financially and economically weak, hence forcing this nation to survive on expensive borrowed money. Strong, honest and decisive leadership is the only cure to PNG’s current woes,” Mr Ekanda expressed.