In December 2012, the anti-poverty advocacy group, Jubilee Australia published a report, PIPE DREAMS: The PNG LNG Project and the Future Hopes of a Nation.
The report examined in detail the potential costs and benefits of the Exxon-Mobil LNG project and concluded “it is very likely the Project will exacerbate poverty, increase corruption and lead to more violence in the country.”
In one part of the report, the authors, Luke Fletcher and Adele Webb, canvased the serious possibility the LNG project would likely fuel clan violence or, even more seriously, conflict between local people in the Hela Province and security forces representing the Government in defending the project.
With these scenario’s now being played out on the ground and army and police units being deployed to Hela Province it is poignant to revisit the report and two pages in particular…
RISK OF SERIOUS CONFLICT
It will be recalled from chapter 2 that violence has played a role in the life of the Huli people. Along with compensation and discussion, violence has been one of the natural and unquestioned means of dispute resolution for the Huli for generations. Problems arise, it might be argued, only when an outside world, hungry for the underground resources of the region, distorts this system of social relations, which, if not exactly ‘harmonious’, was nevertheless part of a world ‘in harmony’. This is the context in which discussions of violence related to PNG LNG should be framed.
When analysing the risks of conflict in the Project areas, it is important to highlight two particular scenarios. The first scenario is intra- or inter-clan violence or conflict in the Southern Highlands among Huli groups, or between Huli and other groups who have migrated to the Project looking for economic opportunities. The second scenario is more serious: that of a larger-scale conflict between Landowners/ locals in the Hela Province and security forces representing the Government and/or the Project.
We now consider these two scenarios in turn.
Project-related conflict between/among clans
The scenario of intra- or inter-clan conflict in the Project area is most likely to unfold from disputes over land, or to arise out of social tensions related to migration into the area. To date, the land ownership disputes that have occurred have been concentrated in PDL 152 where the Liquefication Plant is to be concentrated, rather than up in the Southern Highlands. In January 2010, five people were killed in a conflict near the plant site between Boera and Porebada villages as a result of land-ownership disputes related to Project benefits. In the same month, 270 properties were destroyed, and 11 people were killed by villagers from the neighbouring Erave district, in violence related to the Project. Currently, the large number of economic opportunities available because of the PNG LNG construction boom seem to be keeping a lid on any potential inter-group conflict in the new Hela Province.
Although some compensation cash handouts have already been made, these are relatively small compared with the large amounts of revenue that will enter into the community once the gas starts to flow. In the long-term, land-related conflicts will be minimised if the revenues are collected fully, managed well, and distributed as evenly and fairly as possible. The main concern involves the potentially unresolved issues resulting from the rushed signing of the Benefit Sharing Agreements (BSAs) before the Final Investment Deadline at the end of 2009. These issues could reemerge if there are less positive benefits to share around than have been promised and expected.
According to recent research conducted in the Project area, land ownership disagreements still persist. In particular, 63 per cent of the respondents to one survey felt that Landowner agreements were a problem or a serious problem. Furthermore, many respondents in the Otago University Study identified disputes over landownership as the Project’s most serious potential flashpoint. Such findings are a cause of concern given the large problems that beset almost all the institutions associated with management and distribution of Landowner revenues.
A secondary concern is the relationship between groups that are indigenous to the Hela region and those who have migrated there looking for work and other opportunities. Widespread migration into the region has already occurred; the risk is that this migration might lead to tensions and an increase in violence. In the Porgera gold mine in neighbouring Enga Province, the spike in violent crime has been associated with the huge amount of migration into the area.
Operational Disruption and Militarisation
While this first scenario should not be taken lightly, operational disruption and militarisation of the entire area is the much more dangerous possibility. According to the Otago University Study, close to 30 per cent of respondents felt that conflict between Landowners and the Companies was a possibility—a figure more than double the number of those worried about clans/ Landowners fighting each other.
Small-scale incidents of conflict that have occurred to date include: various reprisals against the Companies and those representing them over the issue of employment and working conditions; workers strikes at the LNG Plant, reflecting dissatisfaction with working conditions and pay, attacks by locals against expatriate workers in the Hela Province; foreign workers being attacked at Komo (the site of the airfield); and, of course, the hostage-taking and occupation of Project sites that occurred in connection with anger over the distribution of the business development payments (see Section 5.2). Fortunately, though troubling, these episodes have been temporary.
What do we currently know about the security arrangements for the Project? First, EHL has designed the Project infrastructure, especially the pipeline, to be as tamper-proof as possible, so as to minimise the likelihood of disruption of the gas flow due to sabotage. It is worth noting that the fortification of Project infrastructure, while intended to minimise Project disruption, could simply push Project disruption techniques to focus, not on the pipeline, but on human and labour resources.
Secondly, there is a confidential Memorandum of Understanding between EHL and the PNG Government that outlines the various roles that each party is expected to play regarding security. In a reply to a letter from Jubilee Australia, ExxonMobil stated that EHL is committed to doing business “in a way that protects the security of its personnel, facilities, and operations and respects human rights”, but that it is the PNG State that has primary responsibility for “maintaining law and order, including addressing crime and general civil unrest, in the PNG LNG Project areas”. The company also stated:
Under the terms of the memorandum, where the government’s capacities or resources are limited, we may provide prescribed support for defensive security purposes only to protect our personnel, facilities and operations – for example, for transportation and accommodation of police in remote Project locations.
The Government’s security apparatus currently in place for the Project contains the following components:
- the local police of Hela Province, who are essentially doing regular community policing;
- three mobile squads of the Royal PNG Constabulary: the same squads who have been operating in Porgera, which are assisting with policing of the Project sites;
- international firms employed by the Project to assist with security. (Two such firms thought to be linked with the Project are: 1) A subsidiary of G4S, the world’s largest private security firm; and 2) Guard Dog Security.)
In early April 2012, the Government announced plans to send squads of the PNG Defence Force to Enga and Southern Highlands Province to quell unrest and violence at the Porgera mine and the PNG LNG construction areas. It is not known at this stage how many soldiers were to be deployed or for how long, although it is suggested that part of the reason for the deployment in the Tari area was that potential unrest could have disrupted the provincial elections in June.
The use of foreign-owned private security firms has been heavily criticised by Former PNG Defence Force Commander and veteran of the Bougainville conflict, Major General Jerry Singarok. Singarok argues that the use of these private security forces pose two separate threats: indirectly, they weaken the strength and the morale of the indigenous defence forces by drawing quality personnel from their ranks; and, more directly, their presence in the Project site is a threat because private security contractors are inherently perceived as more inflammatory by locals, and more prone to violence than domestic forces.91 Some counter Singarok’s claims by suggesting that the private security firms are better trained and more disciplined than PNG forces, but his public position on the issue confirms that there is indeed a pervasive uneasiness amongst the domestic security forces about the use of contractors, which is in itself troubling.
Ultimately, the most important factor regarding the security forces is perhaps not their make-up, but in what manner and under what circumstances they may be deployed in the case of Project disruption. On this note, there is cause for some pessimism, given the Government and the Companies are both dependent on meeting a strict timetable for the deliveries of gas. As was explained in chapter 2, the PNG Government has taken on significant financial liabilities in order to participate in the Project. Although it has to repay many of these before the gas flows, the Government will nevertheless need to apportion some of the Project’s early gas revenues to debt retirement. Moreover, it will be relying on the gas revenues to service other spending obligations in its budget. The Companies, for their part, will face significant financial penalties in the case of disruption of deliveries of the gas to the buyers. In both cases, there are significant financial incentives to respond harshly to any sort of sabotage or Project disruption. It seems fair to assume that if there is serious Project disruption, militarisation of the region is a genuine possibility.
The risk of serious conflict attending the Project will, in the end, turn on the experiences and expectations of the Project-affected communities. When the opportunities from the construction phase dry up, the people of Hela Province and of PDL 152 will face the question of whether their expectations of the Project have been delivered. Will the revenues flowing to the communities transform them into better places? This of course depends on how the revenue management structures we have discussed earlier in the Chapter perform. There is a great deal of uncertainly about this. What we do know is that the communities and groups will make their own assessment of whether the Project has been beneficial overall.
What is less certain is the question of whether communities, and in particular, community leaders, will take disruptive action if they grow unhappy with the Project. Many have already gone on record making public threats against the Project and its workers if they do not get what they want. According to Hela Community Care’s John Tamita:
It may be a disaster coming up. They’ve chopped the neck off a couple of Asians already, Asians who worked on the new airfield in Komo. And most likely, its (sic) also going to be taking place here [Tari] too. A lot of our residences demolished; no payment; we are struggling now; our lives become useless, they didn’t consider us.
A recent news item picked up a similar sentiment expressed by a source close to Southern Highlands landowners:
[… ] I fear what is coming unless something changes soon […] We are not being heard and feel we have no choice. We know we will be out- gunned, and Exxon, being an American company, may receive US government support, but this is about dignity and our rights.
Worryingly, the same informant claimed that weapons are being smuggled into the region in preparation
for violent conflict if expectations are not met. The possibility of a weapons’ build-up in the region was raised two years ago in Jubilee Australia’s previous report on this subject.
The ingredients for Project-related conflict unfolding in Hela Province are all present: high community expectations, the apparent preparedness of some groups to use violence if necessary, a highly-charged and complex security situation, a government and a company that will likely respond harshly to any sabotage or other acts of violence or disruption. The vital ingredient, however, will be the perception of actors within the Project area of whether the promises of the Project were received. If conflict does break out, the most positive thing that can be said is that it is unlikely to be as long-term or as horrific as on Bougainville.
Read the full report – Jubilee Australia Pipe Dreams Report [3.7 MB pdf file]