Category Archives: Australia

Australian govt using ‘aid’ money to promote their mining industry

Bruce Davis, left, and Fred Hess signing a memorandum of understanding at Frieda River last week. Looking on are East Sepik Province Governor Allan Bird, Ambunti-Drekkir MP Johnson Wapunai, Vice Mines Minister Bari Palme, women’s mentor, Fredah Wantum along with women from Paupe village and PanAust employees

Approval processes for any Frieda river mine have not yet been completed – but the Australian government is already spending ‘aid’ money to help ensure the mine does go ahead.

PANAUST, the beneficiary of this ‘aid’ subsidy, is, of course, an Australian company…

Long-term plan for women at Frieda River

PANAUST and the Australian government are working together to empower women through the Frieda River copper-gold project under a new initiative called the Papua New Guinean Women in Mining Project.

In terms of an agreement signed at Frieda River last week, the partners say a three-year work program will strengthen the participation of women in the development forum process and ensure women receive lasting benefits over the life of the mine and beyond.

“The project will provide a mentor to work with women from the Frieda River area to prepare them for participation in the development forum and help organise their governance and representative structures. Selected Frieda River employees will become women’s empowerment and safety champions,” PanAust said.

The partners will also work to build literacy skills, and promote cooperative approaches to decision-making, workloads and budgeting, leadership and coalition building.

At the signing PanAust managing director Fred Hess emphasised the role mining could play in supporting women.

“Mining, perhaps more than any other industry, has the ability to empower women in remote communities. At PanAust, we consider it our responsibility to encourage that development. At our operations in Laos, we have provided pathways for women to acquire trades, become leaders in the company and start small businesses. Our partnership with the Australian government will help us emulate this success in Papua New Guinea,” Hess said.

Australian high commissioner Bruce Davis said Australia was taking part to strengthen women’s participation in resource development negotiations.

“We will help build literacy and financial skills, as well as support women to take on leadership and decision-making roles in the development negotiations, to ensure they directly benefit from mining activities in the region,” Davis said.

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Pacific Islanders call for Australia not to fund Adani coalmine

The village of Eita in Kiribati in 2015. Residents of endangered Pacific islands want the Australian government to stop funding Adani’s Carmichael coalmine. Photograph: Jonas Gratzer/LightRocket via Getty Images

Caritas says thousands face threats to their wellbeing, livelihoods and ‘their very existence’ due to rising sea levels

Naaman Zhou | The Guardian | 31 October 2017 

Pacific Islanders whose homes face eradication by rising sea levels have called on Australia to not fund the Adani Carmichael coalmine, as a new report reveals the worsening impact of climate change across Oceania.

Residents of the endangered islands have described their forced displacement as like “having your heart ripped out of your chest” as they called on the Australian government to do more to combat climate change.

A report released by international aid group Caritas on Wednesday found that thousands of Pacific people across the region faced “threats to their wellbeing, livelihoods and, in some places, their very existence” due to rising sea levels, king tides and natural disasters brought about by climate change.

In Papua New Guinea, 2,000 households across 35 coastal communities were displaced by coastal erosion over the past year. In Samoa, 60% of the village of Solosolo was relocated to higher ground.

In the Torres Strait, 15 island communities were identified as at risk over the next 50 years.

The mayor of the Torres Straight Island regional council, Fred Gela, described the forcible removals as like having your heart ripped out “because you are told you’re not able to live on your land”.

Erietera Arama resident of Kiribati who works for the Department of Fisheries, said he decided to visit Australia to ask its government to take action.

“We talk about the Adani coalmine,” he said. “That’s a new one. I think it’s not a good idea – it makes the world worse for all of us. It is inconsiderate of other humans on this planet.

“We didn’t think of Australia as a country that would do that. We looked at it as our bigger brother. Proceeding with that new mine is a sad move. We live together in the environment but it’s like they are ignoring us.

“We’re two metres above sea level. With the sea level rise, most of our lands have been taken by coastal erosion. We love our country and we want our children to live there as well, hopefully forever. It’s hard to talk about leaving the place where you belong.”

According to the report’s authors, the impact of coastal erosion and flooding reached “severe” levels in 2016, upgraded from “high” the year before. Climate change also made it “increasingly difficult to maintain the health and integrity” of food and water sources. Water scarcity was deemed a “serious slow-onset problem throughout Oceania”.

In terms of natural disasters, a month’s worth of rain fell in 24 hours in New Caledonia in November 2016, killing nine people, while flash flooding in Fiji after Cyclone Winston forced 3,000 people into evacuation centres in December 2016.

In Fiji, the report found that certain types of fish were becoming poisonous, potentially as a result of farming contamination or seabed mining operations.

“Earlier this year four people died in the island of Gau from fish poisoning,” said Leo Nainoka from the country’s social empowerment education program.

Global sea levels are expected to rise 30cm by 2050 compared with a 20cm average rise over the 100 years before 2000. But in certain areas of the tropical western Pacific, sea level rise has been four times the global average due to El Nino and associated weather effects.

“Australia needs to make a stronger contribution to fight climate change and its impacts,” the report says. “To reach our emissions reductions targets, Australian policies need to rule out any major new fossil fuel projects or the expansion of existing ones, as this would be inherently incompatible with meeting our global climate commitments.”

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Labor plans to force Australian mining companies to disclose taxes paid overseas

Labor says it will make large Australian oil, gas and mining companies disclose the taxes they are paying to governments in every country, including Australia. Photograph: Bloomberg via Getty Images

Exclusive: Mandatory reporting regime would apply to large Australian oil, gas and mining companies working overseas

Gareth Hutchens | The Guardian |30 October 2017

A Shorten Labor government would force Australian mining companies working overseas to disclose the taxes they are paying to foreign governments to extract their minerals.

The mandatory reporting regime would apply to large Australian oil, gas and mining companies, and be designed to ensure that communities in countries such as Papua New Guinea understand how many tax and royalty payments they are receiving and for which mining projects.

Labor says it wants Australia’s resource companies to be “good corporate citizens” and to maintain transparent accounting practices that combat corruption.

It says many of Australia’s neighbours, including Timor-Leste, Papua New Guinea, the Solomon Islands and Nauru, have multibillion-dollar resource projects that are operated by foreign multinationals but are home to some of the poorest people in the world.

Labor will announce on Tuesday an “extractive industries transparency plan” that will require large Australian companies to disclose the taxes they are paying to governments in every country, including Australia, and for every mining project.

Large companies shall be defined as a company that meets at least two of three criteria:

  • Total assets exceeding $50m
  • Annual turnover exceeding $100m
  • The average number of employees exceeds 250

A single or series of taxes and related payments within a financial year would have to be disclosed if the payments were worth at least $150,000.

Payments to be disclosed include: taxes on income, production or profits; royalties; dividends (except where the dividend is paid to a government as an ordinary shareholder); fees including licence fees, rental and entry fees; signature, discovery and production bonuses; production entitlements (such as profit resources) and payments for infrastructure improvements.

The scheme has been costed by the parliamentary budget office at $2.2m over four years. Between 80 and 100 companies would be affected. Subjected companies would be required to begin reporting payments to governments from 1 July 2020.

A multi-stakeholder committee would be established to help the government implement the reporting regime, including defining project-level reporting and establishing an online reporting mechanism to ensure public transparency.

Labor says the legislation would include equivalency provisions so companies captured by other jurisdictions due to cross listing on stock exchanges would only be required to produce one report. The scheme has been modelled on the extractive reporting regime in the UK.

Matt Thistlethwaite, the shadow assistant minister for Treasury, will announce the plan on Tuesday in a speech to the Australian Council for International Development’s national conference in Melbourne.

“Currently Australian companies do not meet world’s best practice for transparency and accountability,” he will say. “Labor is determined to change this.”

Mal Larsen, Oxfam Australia’s mining and extractives policy adviser, has welcomed the policy, saying he has been calling for something like this for a long time.

“This policy could help lift people out of poverty,” Larsen told Guardian Australia. “Australia would join the growing list of countries around the world that require large companies to reveal how much tax is being paid, in which country and for which mine.

“This sort of disclosure will allow the public to hold companies accountable for how much tax they pay and governments for how they spend it.

“Disclosure of tax payments is an emerging international standard. It is key to driving out corruption and building community faith that mining taxes are being spent on essential services like health and education.”

In May 2016 the Turnbull government announced Australia planned to join the Extractive Industries Transparency Initiative, an international standard for increased transparency and accountability in the oil, gas and mining sectors.

It will require Australia to disclose information on taxes and other payments made by companies to the Australian government as well as other information such as licences, contracts, production and exports.

Larsen says Labor’s policy goes further because it would require Australian companies to disclose the payments they are making to foreign governments, not just to Australia’s government.

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Frieda river mining company in corruption investigation in China

Guangdong Rising Assets Management is under investigation for a series of bad investments including the purchase of PanAust and the Frieda river mining rights. Four people are already being prosecuted for corruption and now the former Chairman is in the spotlight over losses of more than $1 billion

Chinese probe big mine loss

Rowan Callick | The Australian | October 16, 2017

The former chairman of a Chinese state-owned enterprise has been handed over to prosecutors for investigation after the company’s investments in several Australian mining ventures lost more than $1 billion.

Li Jinming, who chaired Guangdong Rising Assets Management, which is owned by Guangdong province, was earlier expelled from the Communist Party following an investigation that began in 2014 over losses that the disciplinary inspection team described as “dreadful”.

The company was established 17 years ago with $2bn capital, the South China Morning Post reported, and it began investing in Australia after the Global Financial Crisis pushed down asset and commodity prices.

It acquired, through different subsidiaries, lead-zinc producer Perilya for $45.5 million, coal producer Caledon Resources for $500m, copper and gold company PanAust — with a massive prospect awaiting commitment in Papua New Guinea at Frieda River — for $180m, and rare earths producer Northern Minerals for $60m,

It also paid $15m for a large stake in gold and base metal explorer Hawthorn Resources.

Leading Chinese financial website Caixin reported that most of these deals had since made losses, with calls on further capital from GRAM.

Li Zezhong, who worked for GRAM for 11 years, ultimately as president, was then appointed mayor of Zhuhai, a thrusting city of 1.5 million on the western side of the Pearl River Delta, just north of Macau.

It was his successor at GRAM who urged a deepening of the investigation into the company’s management.

Last month it was announced that Li Zezhong was being investigated for “serious violations of party discipline,” believed to relate to his time at GRAM.

Four colleagues from his time at the company are already being prosecuted for corruption.

Caixin has reported that investigators are also seeking to interview Liu Facai, now living in Australia. He chaired the committee responsible for all state assets in Guangdong province when he led a team to Australia 11 years ago to explore investments in mineral projects.

Caixin said that he and his son, who was already living in Australia, introduced GRAM to firms in which the company went on to invest.

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AusAID to partner with mining industry to deliver ‘aid’

Peter Aitsi and Bruce Davis can’t keep a straight face – just one more way for the Australian taxpayers to subsidise their mining industry!

THIS WOULD BE HILARIOUS IF IT WASN’T SO PATHETIC

EVEN MONTY PYTHON COULDN’T COME UP WITH ANYTHING SO RIDICULOUS…

Aust to assist Newcrest facilitate projects in PNG

The National | September 1, 2017

AUSTRALIA has entered into a partnership with Newcrest Mining Limited to facilitate support on projects in Papua New Guinea.
Australian High Commissioner Bruce Davis and Newcrest country manager Peter Aitsi signed an agreement yesterday.
The first year will be committed to:

  • Scholarships for Diploma of Nursing;
  • Australian awards scholarships in midwifery;
  •  Workshops on extractive Industries transparency initiative;  and,
  •  A mineral economics course to be delivered under the Pacific leadership and governance precinct.

Davis said it reflected Australia’s focus on engaging businesses to assist in development challenges.
“The approach recognises that the private sector has the means and increasingly the motivation to contribute to the development outcomes as part of their core business,” Davis said.
“It also recognises that the private sector are key players in addressing and improving the business environment, not just for themselves but also for their suppliers, buyers, employees and their employee’s families.
“Newcrest is on such company. Newcrest’s confidence in Papua New Guinea as an investment destination matches the Australian High Commission’s positive long-term outlook for Papua New Guinea.”
Aitsi said the company’s commitment to development was for the long-term.
“Newcrest already has a long record of engagement in PNG. And with 40 per cent of our global assets in this country, we hope to be a partner to Papua New Guinea for decades to come,” he said.

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How resource companies exploit a corrupt and dysfunctional government

There has been a barrage of media recently about mining companies teaming up with a range of parters to deliver health-care and other services direct to the community.

Newcrest Mining and the Australian government have announced a partnership to improve maternal health, Exxon-Mobil is partnering the Cancer Foundation and The Voice, Barrick Gold is delivering agriculture training in Porgera.

Praise be to the resource companies, willing and able to step in where government fails its people – and no matter the role these same companies play in causing the very diseases, illnesses and other problems they are so happy to patch up with their band-aid PR!

But there is an even more sinister side to these good news stories that further illustrates how mining and other resource companies feed off a corrupt and dysfunctional government.

If government was doing its job and delivering decent basic services to the population, mining and resource companies would not have the opportunity to appear as ‘knights in shining armour’ the good news stories would disappear and, most importantly, customary landowners would not feel compelled to give away their land in the desperate hope that mining and logging companies might provide some basic services.

Resource companies are able to thrive in PNG because of, not despite, a corrupt and dysfunctional government. They rely on bad governance to open the doors to what they most desire – land and the resources it contains.

No matter the environmental and community destruction, their logging and mining cause, no matter the deaths, the violence against women, the unwanted pregnancies, the rape and prostitution, the pollution of rivers and loss of sustainable livelihoods when they can parade their social conscience in the media and have us all believe they are our saviours – just as long as we continue to give them what is most precious to us, OUR LAND!

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How the free market failed Australia and priced them out of their own gas supply

While Asia is enjoying low prices for Australian gas, back home things are getting worse. (Origin Energy)

Ian Verrender | Business Editor | ABC News

Fashion has a habit of turning full circle.

Remember that old shirt, the super tight one with the stretchy material and weird collar that you found at the bottom of the wardrobe? What on Earth possessed you to buy it, you wonder. What were you thinking?

For anyone who lived through the ’70s, the memories of those fashion crimes often come back to haunt us.

It was also an era when free market ideology began to assert itself in public policy. And with good reason.

Government-run businesses were inefficient, bloated and bureaucratic. Letting them loose would free up scarce public funds, competition would lower prices and scarce resources would be allocated with the greatest efficiency.

When Margaret Thatcher came to power in the UK in the 1980s, she unleashed a wave of privatisations that transformed the economy and contributed to decades of economic growth.

It didn’t take long for the fad to gain ground here. Government-owned businesses from airlines to banks and insurance companies were jettisoned.

Even vital infrastructure like roads, telecommunications and power generators were flogged to the highest bidder with little thought about the long-term consequences.

But have we gone too far? Free market theory, while it’s terrific in theory, has some almighty shortcomings and, as we now are discovering, may not be the economic cure-all we once imagined.

Suddenly, the winds have shifted. Business leaders talk in hushed tones, openly uttering a phrase once considered unmentionable: market failure.

In the past few days, there has even been a call for part nationalisation of our energy industry from a free market wheeler dealer. More on that later.

A fortnight ago, competition chief Rod Sims let fly with his annual swipe at the fee-gouging taking place at our airports.

Airlines and the travelling public were forking out an extra and largely unnecessary $1.6 billion in fees.

What’s going on with gas?

The problems arise when the business being sold is a monopoly, when the buyer, having paid an exorbitant price, is given carte blanche to extract its tonne of flesh. The benefits flow from the community to private interests, often offshore.

Generally, we’re talking about utilities — things like power companies, for instance. And then there is gas.

For years, electricity and gas operated independently. But the two have become intertwined as the shift towards a cleaner environment and lower emissions has thrust gas firmly into the box seat as the transition fuel to generate electricity.

We’ve suddenly discovered, however, we don’t have enough. It’s no exaggeration to describe the power situation now facing eastern Australia on both fronts as a catastrophe. And here’s why.

Within the next four years, Australia will overtake Qatar as the world’s biggest supplier of gas. We are sitting on vast gas reserves. In fact, we’re swimming in the stuff.

And yet, we face critical shortages at home which could starve manufacturers of fuel, see power outages across the eastern states and force energy prices through the roof while any profits that are made will be shipped offshore.

This is a public policy fail of epic proportions.

And it’s worth getting a handle on how it all came about and the shenanigans employed by the gas majors that have deliberately created this crisis and the supposed shortage which is a total con.

How could this happen?

First, however, consider this: the gas we are exporting does not belong to the energy giants. It belongs to us.

Companies like Woodside, Origin and Santos and their foreign partners merely have bought the right to exploit those gas reserves, which was supposed to lead to massive benefits for ordinary Australians.

Here’s the scorecard so far. Having spent close to $250 billion building new export facilities, no-one seemed to think that flooding the globe with extra energy would see global prices drop.

They have. Gas prices into Asia, where we export, have now dropped below what it costs to extract, process and ship the stuff. In fact, the east coast suppliers so far have written off around $6 billion on their new plants.

It gets worse. Extracting the gas from coal seams in Queensland was a little more problematic than originally thought. Then farmers, incensed at the activity taking place on rich agricultural land, began shutting the gates.

That meant the companies couldn’t get enough to satisfy the huge supply contracts they’d written in Japan, South Korea and China. So they plundered the supplies, much of it from Bass Strait, that once powered the domestic market. That’s why we have an artificial shortage.

But wait, there’s more. No-one ever considered that once we were plugged into the global market, we’d be paying global prices. Around the time all these new gas plants were developed, prices in Asia were up to $25 a gigajoule. Back then, we were paying between $2 and $4.

Prepare now to be outraged. Global prices have more than halved to $10 and under. Domestic prices, meanwhile, have soared, to well above $10 because of the domestic shortage.

By putting the domestic market under pressure, they deliberately pushed local prices higher.

The upshot is that we now are paying more than Japanese manufacturers for our own gas. In fact, power company AGL is actively considering buying Australian gas in Japan and shipping it back home. And why not? It’s cheaper there.

That means energy-rich Australia is subsidising Asian manufacturers while penalising our own, a situation likely to force many to the wall.

Just to rub salt into the wound, the ramp-up in exports has not delivered the resources rent tax bonanza once promised by US giant Chevron. In fact, thanks to a shifty cash shuffle, ExxonMobil, Chevron and Shell until two years ago were booking around $3 billion a year in profit, tax free.

That’s seen our Petroleum Resources Rent Tax proceeds, which in the past delivered around $2 billion a year, plummet. In fact, by the time we overtake Qatar for global gas domination, it’s anticipated our resources tax will collect just $800 million.

Qatar, on the other hand, is expected to receive $26.6 billion in royalties that same year for roughly the same volume of exports.

So what’s being done about it?

Treasurer Scott Morrison last year declared he would urgently look into the matter. He’s called a review to get to the bottom of why soaring exports have coincided with a halving in the resources rent tax collections.

The review panel could do worse than read a report sent out last week by global investment bank Credit Suisse.

Hardly a bastion of left-wing ideologues, the report — entitled The Wolf Who Cried Boy — raises the prospect of Australia establishing a national oil company as one possible solution to the concocted crisis. And it goes straight for the jugular.

“If the gas producers and sellers are the wolves, they themselves are seemingly calling foul just as the danger is truly upon us,” it begins.

“We wonder whether a national oil company, a la Kumul Petroleum in PNG, could work? Instead of the petroleum resources rent tax on future projects, could we see state participation instead?”

Could we indeed? There undoubtedly will be howls of protest from the business lobby and their associated hangers-on. But consider this. Is this not the ultimate form of capitalism?

We are the landlords. The energy companies are tenants. If we had a controlling stake in the business, it would be much easier to ensure the kind of chicanery that has taken place in the past few years was never repeated. There would never be shortages.

And just perhaps, we’d end up with a dividend cheque, maybe even along the same lines as Qatar’s.

Just a thought.

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