Category Archives: Papua New Guinea

Booting Exxon gives Marape a boost – for now

Western Highlands province in Papua New Guinea, the region of the proposed P’nyang LNG development (ADB/Flickr)

The rejection of the P’nyang LNG deal signals a new way of doing business, and a shifting landscape for US concerns.

Bal Kama | The Interpreter | 19 February 2020

The recent announcement of the Papua New Guinea (PNG) Government to cease all negotiations with one of the United States’ largest oil and gas companies, Exxon Mobil, over the P’nyang LNG project, a new gas field in PNG, has broader implications for the US and Papua New Guinea.

At first glance, the decision against Exxon for allegedly acting in bad faith is part of a wider crackdown by the government of Prime Minister James Marape to ensure greater fairness in the resource sector. Since ousting then–Prime Minister Peter O’Neill in a vote of no-confidence in 2019, Marape has charted a different approach from that of his predecessor, under the banner of “Take Back PNG” – a larger policy objective to reassess PNG’s developmental direction and regain lost opportunities. Marape laid out his vision in his inaugural visit to Australia in 2019 and is gradually applying it in many sectors.

The decision illustrates the growing frustrations of dealing with investors in resource-rich PNG, and it further demonstrates an emerging crop of PNG leaders confident in reassessing the status quo. For the US, Exxon’s alleged conduct, criticised by the PNG government as being “exploitative”, undermines US efforts in the Pacific region as a force for good.

Exxon Mobil has a US$19 billion liquefied natural gas project in PNG (PNG LNG), which made its first shipment in 2014. The PNG LNG project, which remains the largest economic investment by the US in the Pacific, coincided with former US President Barack Obama’s announcement in 2012 of a “pivot to the Pacific” policy. The geopolitical scenario of the day, the excitement of having the US interested in PNG, and the high expectations surrounding a global and reputable company, among other factors, influenced the PNG government’s initial agreement for Exxon to operate the PNG LNG project. It was thought the deal would have a transformational impact on PNG’s economy – an assurance that continues to be projected by some quarters.

However, the overall economy of PNG did not experience the projected windfall. Instead, there were a series of negative outcomes over the years at both a national and a local level – national debts grew, and unfavourable benefit-sharing arrangements and royalties led to conflict among traditional resource landowners. Many have questioned whether the resource boom marked by the PNG LNG project was in fact a “resource curse”.

“Absolute bad faith”

The ousting of Prime Minister Peter O’Neill in 2019 was partly a result of growing grievances over the failure to deliver on the promises of the Exxon-led project and other resource deals. An important issue was the high level of concessions made in those deals. Historically, PNG governments, desperate to become investor-friendly, have made hasty concessions that often disadvantaged the country from having a fair share of the revenue from the development of their resources.

In a 2016 report, the International Monetary Fund (IMF) observed that “the tax arrangements for PNG’s mining and petroleum sectors are very generous compared to other resource-rich countries and do not reflect the maturity of the PNG resource sector”. The World Bank, in a 2017 report, also found particularly for the Exxon-led LNG project that Exxon Mobil and its PNG LNG partners created “a complex web of exemptions and allowances that effectively mean that little revenue is received by government and landowners”.

The PNG government must share some burden of fault for creating this scenario – including, for instance, the failures by previous PNG governments to negotiate a favourable outcome for the country, the misuse of funds by political leaders, a politicised bureaucracy unable to carry out their due diligence, and judicial interventions that at times hinder payments to disgruntled landowners.

This does not, however, excuse Exxon and its partners from the grave unfairness suggested in these reports. This, together with his experience as a minister in previous governments, underpinned Marape’s firm stance on taking a different approach in the current deal on the P’nyang LNG project. In his appeal for Exxon Mobil to act fairly, Marape noted that “the initial terms [in the PNG LNG project] provided by PNG were so generous” and that new “reasonable terms” should be considered for the P’nyang project.

Papua New Guinea’s Prime Minister James Marape (C) at Parliament House in Canberra, during a six-day visit to Australia in July 2019 (Mick Tsikas/AFP via Getty Images)

The terms proposed by the PNG government are not publicly available, but they appear to include giving no fiscal concessions in P’nyang, treating it as separate project from the current LNG projects and increasing domestic market obligations, local content participation, and landowner’s royalties from the current rate of two percent. The Prime Minister described Exxon’s refusal to accept the terms as a move to “extract even more profit for themselves”, while Kerenga Kua, the Minister for Petroleum and Energy denounced Exxon as acting in “absolute bad faith” and coming into PNG “with a determination to exploit our vulnerabilities, exploit us for our weak economic position and take advantage of us”.

A principled populist

The firm position taken by the Marape government is historic – no previous government has ever taken such an approach. PNG has had resource deals in the past that have resulted unfavourably for the country, but past governments have been shown to align more closely with investors than with their citizens.

The leaders and the people of PNG appear to be supportive of Marape’s approach. Further, the government is considering amending and tightening the legislative framework to ensure an equitable resource sector.

Marape is unlikely to concede to Exxon Mobil, as he insists: “You win for your shareholders, and I win for my people”. James Donald, a Member of Parliament representing the area where P’nyang LNG site is located, cautioned Exxon against crossing “a line between commercial parity and commercial greed”. Other MPs representing the resource areas have also demonstrated support for Marape’s stance against Exxon.

The PNG government is likely to reconsider its current position if Exxon responds positively to its terms. Unless that happens, however, there appears to be a general distrust for Exxon among the people of PNG – a situation far from the hope Exxon represented when it first entered the country. The distrust for Exxon has broader implications when one considers Exxon not only represents US economic prestige in the Pacific, but a society whose business ideals are expected to reflect the democratic values of fairness and just outcomes. The longer this tussle between Exxon and the PNG Government continues, the greater the distrust is likely to be, not only for Exxon, but for what it represents – the United States – in the Pacific.

As the vote of no-confidence scheme against a sitting government in PNG resumes later this year, those affected by Marape’s firm policies may hope for a change in government. In the fluid political landscape of PNG, a populist and comparatively principled Marape faces a challenge beyond just his immediate political rivals, and inside company boardrooms. However, if anything, his approach to governance so far has been reassuring for the people of Papua New Guinea.

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New report names top British companies responsible for toxic mining legacies

Kalimantan, Indonesia. Coal mining operation. Credit: Daniel Beltrá

BHP and Rio Tinto have a long history of extracting minerals then pulling out, leaving devastation in their wake. Climate justice organisation London Mining Network reveals the extent of this in a new report.

London Mining Network | Feb 19, 2020 

London Mining Network has published a new report entitled ‘Cut and run: How Britain’s top two mining companies have wrecked ecosystems without being held to account’. The report includes examples from Southeast Asia of where the British-Australian multinationals BHP and Rio Tinto have left legacies of conflict and environmental destruction, long after they’ve fled the scene.

Recent examples of mining messes include Brumadinho, the tailings (mining waste) dam owned by Brazilian mining company Vale, which collapsed in January 2019 in Minas Gerais, Brazil. Vale executives, along with its German advisors TUV Sud, were recently charged with the homicide of 272 people; 14 people are still missing. Vale, along with BHP, jointly own the Samarco iron ore mine and tailings dam which also collapsed in 2015, causing Brazil’s worst environmental disaster in history and the deaths of 20 people. The trauma due to loss of life, displacement and job loss and the environmental repercussions of contamination of river systems in both catastrophes will be felt for decades to come. The entire mining industry needs to be held to account for such mining messes, and laws made which demand the cleaning up of messes made by mining companies before they pull out of projects.

Despite the best efforts of the industry, particularly BHP, to greenwash the extraction of fossil fuels and metals, the practice of ‘cutting and running’ when companies close mining operations tells us another story. The harm that extraction causes people and the planet doesn’t end once the companies disappear.

On 10th February, BHP became the world’s top copper producer, but this isn’t good news for the communities affected by their copper mines, and the other metals and minerals it extracts. In 2002, the company walked away from the Ok Tedi copper-gold mine it had controlled since 1982 in Papua New Guinea. For years it had dumped waste straight into the local river system. Eventually the company concluded that it should no longer do that and should not have operated the mine after all. But 18 years later the contamination and mess remains.

Rio Tinto was the majority owner of the Panguna mine in Bougainville, operated by Bougainville Copper Ltd (BCL), for 45 years. It dumped toxic mining waste the copper-gold mine in Bougainville (an island off the coast of Papua New Guinea) straight into the local river system between 1972 and 1988. This caused such outrage that it sparked a war for independence from Papua New Guinea, a war in which thousands were killed and independence was not won. The mine was abandoned. In 2016 Rio Tinto gave the mine to the authorities in Bougainville and Papua New Guinea but they do not have the financial or technical means to clean up the waste.

For shareholders in Rio Tinto and BHP, the deadly legacies of these mines make for risky investments, as the report illustrates.

Co-author of the report, Hal Rhoades, from The Gaia Foundation, said:

“This report shows how British multinationals have profited from destroying ecosystems and people’s livelihoods on vast scales in the Global South, while leaving their mess behind for communities to deal with. These are the same companies who are now trying to convince us that they hold the answers to the climate emergency. We cannot continue to pay lip service to tackling climate change while allowing the world’s largest corporations to devastate ecosystems that help regulate the climate and the communities that care for them. Holding these companies accountable and calling out their greenwashing is a crucial part of climate justice.”

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PNG Prime Minister officially takes on Horizon Oil

  • A saga of corruption and bribery allegations continue for Australian company, Horizon Oil
  • Papua New Guinea’s (PNG) Prime Minister, James Marape, has now publicly taken aim at the scandal — making the issue a priority
  • The scandal involves a AU$15.4 million transaction to a small shell company, reportedly linked to former PNG Petroleum and Energy Minister, William Duma
  • Duma continues to work in the PNG Government and James Marape has denied calls for an immediate sacking
  • Marape and Duma are expected to make a formal statement on the scandal
  • Shares in Horizon Oil continue to devalue on the Australian market, falling 3.61 per cent on Tuesday for a worth of eight cents each

Fraser Palamara | The Market Herald | 19 February 2020

Prime Minister of Papua New Guinea (PNG), James Marape, has publicly taken aim at Australian company Horizon Oil (HZN).

The pacific island leader is backing an investigation into the Australian explorer — spiralling from reports of ‘missed corruption warnings’ and a suspicious multi-million-dollar payment.

News of the saga first reached headlines earlier this month, including allegations of bribery.

Now the investigation has reached all the way to the top order of Papua New Guinea’s Prime Minister, James Marape.

“If there is corruption involved, then find the evidence and due action will take its course,” James Marape said publicly on Tuesday.

“I have sent a request to the highest levels in Australia. I am interested in this matter.”

“The Ombudsman and the police have every right to establish a file on this matter.”

Marape was elected as Prime Minister last year, running a campaign on promises to clean up corruption and hold foreign companies more accountable. He has commented that domestic investigations into Horizon Oil could begin.

The Horizon Oil allegations of corruption spawn from a payment made in 2011, following a denied petroleum licence application in 2009.

Horizon Oil then made a AU$15.4 million payment to an ‘unknown shell company’ — reportedly linked to PNG’s Minister for Petroleum and Energy at the time, William Duma.

Duma’s department was shown in documents to award a 10 per cent stake in a development licence to the same shell company. This company was listed in ownership under Duma’s personal lawyer at the time.

William Duma still works within the PNG Government, but Prime Minister Marape has denied calls for an immediate sacking.

However, Horizon Oil’s Chief Executive Michael Sheridan has faced fallout — being suspended as of last week.

Share prices in the publicly traded Australian explorer also fell 30.8 per cent at the time, lowering to a valuation of 8.3 cents each.

James Marape said on Tuesday that he and William Duma will make a formal statement on the matter in the very near future.

Shares in Horizon Oil continue to shrink, lowering an additional 3.61 per cent on Tuesday. They last closed at eight cents each.

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Artisanals allowed to mine ELs

PNG Report | 16 February 2020

COMPANIES with exploration licences do not have the right to stop landowners from doing alluvial mining on their tenements.

This is the word from Mines Minster Johnson Tuke, who said that in accordance with Papua New Guinea’s constitution, a company could obtain an exploration licence but alluvial mining was “confined and reserved for landowners”, The National newspaper reported.

Tuke was responding to East Sepik Governor Allan Bird’s questions relating to landowner groups in Maprik being denied access by a foreign company to do alluvial mining on their land.

Bird said even though the Mineral Resources Authority (MRA) issued a number of alluvial mining licences to landowner groups for the many alluvial prospects there, issues were still faced by those operating under those licences.

He said a foreigner was killed three months ago in his province as a result of issues relating to the MRA alluvial mining licences.

“The MRA and other government departments and agencies do not consult us before allowing foreign companies to operate in our province,” he said. 

Bird said a foreigner operating in Maprik had restricted local landowners from obtaining alluvial mining licences to operate on their land. “What happens to the rights of landowners when the MRA issues exploration licences to foreign companies to operate on their land?” Bird asked.

Tuke said even though alluvial mining was reserved for landowners, the MRA, through its mining advisory council, had the power to determine who was capable of conducting mining activities.

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Concern over Wafi-Golpu marine waste dumping

Landowners protest against marine waste dumping plans for the Ramu mine in 2010

Concern over proposed deep sea tailings outfall

The National aka The Loggers Times | February 12, 2020

MINISTER for Fisheries and Marine Resources Dr Lino Tom is unsure about the proposed deep sea tailing pipeline outfall (DSTPO) from the Wafi-Golpu project likely to go out at Wagang, few kilometres east from Lae city.

Wagang, in the Ahi local level government, is at the centre of the proposed construction of new fishery wharf project undertaken by the National Fisheries Authority (NFA) and the Wafi-Golpu project DSTPO.

Tom earlier said much of the revenue from fishery sector was generated from tuna. But he was uncertain about the DSTPO.

NFA managing director John Kasu said discussions were still underway.

“The NFA is aware of the proposed DSTPO and discussions are underway to find a common understanding” Kasu said.

Kasu, however, did not explain which Government agencies and private entities were trying to find a common ground for mitigation, should any consequences arise from the impact of the DSTPO if constructed.

Last Aug 20, Tom signed a memorandum of understanding with Morobe Governor Ginson Saonu to ensure that the NFA completed its geo-tech feasibility and land investigations to allow the start of the project construction.

Saonu wants to see the construction of the Wagang fisheries wharf start less than three years from now.

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Australia’s Newcrest says PNG gold project back on track as stay lifted

Reuters | 11 February 2020

Australia’s Newcrest Mining Ltd said on Tuesday Papua New Guinea’s national court dismissed a stay order on work relating to the Wafi-Golpu gold-copper project, paving the way for talks to resume on it with the Pacific country’s government.

The deal by Wafi-Golpu co-owners Newcrest Mining and South Africa’s Harmony Gold hit a bump when the Papua New Guinea government said in September it wanted to keep 40% of gold produced from the project.

The government then withdrew support for the memorandum of understanding in January due to delays caused by legal proceedings.

Newcrest shares have fallen more than 20% since September. They rose 0.6% on Tuesday, compared to a marginally lower Australian gold shares index.

The miners had been hoping to secure a mining lease over the major gold and copper deposit early last year, before a change in PNG’s leadership and a shift in minerals policy led to delays.

Newcrest and Harmony look forward to re-engaging with PNG and progressing on discussions about the special mining license, Australia’s largest listed gold miner said in a statement.

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Horizon Oil denies Financial Review’s $15m bribery scandal allegation, launches independent investigation

The allegations had an immediate impact, with Horizon Oil’s share price closing out the day down over 28% to $0.086.

Lorna Nicholas | Small CAPS | February 10, 2020

In response to an Australian Financial Review article alleging a $15 million “bribery scandal”, Horizon Oil issued an ASX statement saying it “has no actual knowledge” of any wrongdoing.

However, prior to market close today, the company revealed it had initiated “an independent investigation” into the matter, due to the “seriousness of allegations” made in the AFR article.

According to the AFR, Horizon “repeatedly ignored” corruption warnings and paid US$10.3 million ($15.4 million) to a shell company in Papua New Guinea nine years ago.

The AFR purports the payment was made 10 weeks after Horizon secured a development licence in PNG after an ongoing legal dispute with PNG’s Minister for Commerce and Industry William Duma.

In documents the AFR obtained including emails, faxes, letters and legal briefs, the deal revealed links between the company and Mr Duma, with lawyers warning investigations would be “likely” if the transaction was “scrutinised”.

The revelations have pressured Horizon chairman Mike Harding, who joined Horizon’s board in 2018, to investigate the allegations.

Although the deal was before Mr Harding’s time, the AFR claims Horizon’s chief executive officer Michael Sheridan is “named extensively” in the files along with former chief executive officer Brent Emmett.

Both Mr Sheridan and Mr Emmett have declined to comment on the allegations. Meanwhile, Mr Duma told the AFR the allegations amounted to “political witch hunting and malicious intent” to make him look bad.

Background

The situation arose in 2010 when Mr Duma accused Horizon of breaching its licence.

In an internal email leaked to the AFR, Horizon’s then chief executive officer Mr Emmett said it “smells like someone is setting the scene for a handout for a problem that doesn’t exist”.

By the end of 2010, Horizon and Mr Duma were embroiled in a legal battle, with Mr Duma opening up a tender process to develop the gas field.

The AFR noted that Horizon then wrote to Mr Duma stating it was “open to any suggest” on resolving the issue, which was the trigger for a settlement which eventually occurred in March 2011.

Horizon’s response

The allegations involve the $15.4 million payment to acquire an interest in Petroleum Retention Licence 21 in PNG’s Western Province, which is known to be in an area hosting condensate and gas discoveries.

According to Horizon, it and its co-venture partners applied for renewal of PRL 5 in PNG, which was not granted.

“Horizon commenced judicial review proceedings in respect of the Minister’s decision to protect its commercial interests,” the company stated.

“As announced on 31 March 2011, the proceedings were settled including on terms providing for Horizon to be granted a 70% interest in a new PRL 21, covering the same area as the former PRL 5,” Horizon explained.

PRL 21 was subsequently awarded to Horizon and two local PNG companies – Elevala Energy and Dabajodi International Energy.

Under a pre-existing contract, Horizon then transferred a 35% interest in PRL 21 to a subsidiary of Talisman Energy.

Horizon then acquired a 10% interest in the PRL from Elevala for US$10.5 million and a further 5% stake from Dabajodi.

“Following these transactions in 2011, PRL 21 was held by Talisman (40%), Horizon (45%) and Kina Petroleum, which was formerly Dabajodi (15%).”

AFR’s allegations

The AFR has pointed out that PNG lawyer Simon Ketan became the sole director and shareholder of Elavala four days before the licence was granted.

Ashurst lawyers that worked on the deal under the legal firm’s previous name of Blake Dawson noted “close connections” between Mr Ketan and government officials, with sources informing the AFR Mr Duma and Mr Ketan were “associates”.

Mr Ketan told the AFR the files for a “private commercial deal” were closed as they occurred more than seven years ago.

He added he “did not recall” any “alleged concerns”.

The AFR’s probe has unearthed no record of Elevala operating any business, providing grants or dividends, or employing staff.

At the time, Elevala’s registered capital was just $0.88.

Horizon’s share price plunged on the news – with the company closing out Monday at $0.086 – down 28.3%.

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Rural alluvial miners to be empowered

Loop PNG | February 11, 2020

Morobe Governor Ginson Saonu has reaffirmed the Morobe Provincial Government’s position to empower all rural alluvial miners of Wau-Bulolo.

This was highlighted following a discussion with four tenement holders of Wau, Bulolo and Watut River in Bulolo District.

Governor Saonu said MPG has now engaged the services of Albatross Integrated Limited, who have extensive years of working with alluvial miners and other mining projects of New Ireland Province.

The company will be the coordinating body to ensure the alluvial miners are empowered.

“These are new interventions undertaken by MPG and to drive the agenda of mining in Morobe,” Governor Saonu stated.

“I have appointed a Tutumang committee chairman for mining who will work closely with the alluvial miners, landowners, miners associations and cooperative societies from here and onwards to ensure they are fully taken care of in their activities. All reports will then be presented back to PEC on the progress of the alluvial miners.

“I understand that over the many years, the landowners and historical miners of small scale mining in Wau- Bulolo have been deprived of the full benefits of their gold, and so it is time for MPG to intervene to assist them to reach maximum benefits of alluvial gold.”

Governor Saonu said plans are in place to ensure all alluvial gold collected by the landowners and tenement holders are made into gold bars to ensure financial security in the long run.

“The Regulatory Operations Division (ROD) of the Mineral Resources Authority and Albatross Integrated Limited will work now more closely with the landowners and tenement holders to ensure the all are fully taken care of in their alluvial mining activity.

“The aim of empowering the alluvial miners is part of the Economic Policy of Triple 1, where people of Morobe are empowered at which activity they are engaged in to be financially sound,” Governor Saonu explained.

He further emphasised that financial literacy training will be conducted for all Wau-Bulolo alluvial miners as well to ensure they are financially capable.

“The alluvial mining sector will be another economic opportunity for Morobe and a revenue generating activity for Morobe as well.”

Matthew Dalga, the MRA Development Engineer at the Small Scale Mining Branch representing ROD and MRA, said alluvial mining has huge potential and it can bring positive benefits if well-coordinated and supported.

“The MRA will support wherever possible in terms of compliance and ensure the regulatory process is followed so that the initiative taken progresses to a positive direction,” he stated.

Albatross Integrated Limited Principal Bridget Laimo said all good governance and transparency mechanisms will be in place to ensure all alluvial tenement holders and people are given maximum benefit for their efforts.

“Albatross working will be a family orientated partnership with the alluvial miners from onwards,” she stated.

“The levies retained from the alluvial gold sold will go back to your communities to help build roads, schools and all other necessary development infrastructure.”

Albatross Integrated Limited for six years have been working with landowners at New Ireland Province, and also up at Hides and Porgera and will now do the same for Morobe.

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Lockyer’s visit not taken kindly

Darren Lockyer with Kainantu MP and Mining Minister Johnson Tuke during a press briefing of the Eastern Highlands Super 8 Rugby League tournament on January 31 in Port Moresby. The tournament is an initiative of Tuke

“Lockyer, your entire country is on fire from the impacts of coal”

Carmella Gware | Loop PNG | February 7, 2020

Whilst rugby league enthusiasts were star struck at the sight of Darren Lockyer during his recent trip, other Papua New Guineans did not take too kindly to his visit.

Lockyer, whose name is synonymous with Australian rugby league, is also attached with an exploration and energy firm that is currently eyeing coal production in PNG.

The company is Mayur Resources Ltd where Lockyer heads its business affairs division.

Among those concerned Papua New Guineans was environmentalist and Northern Governor, Gary Juffa.

“This is a grave insult to PNG but most won’t realise it,” Juffa commented under an earlier article by Loop PNG.

“We have become so brainwashed that we will be convinced of anything if they simply put an Aussie rugby league player in front of it to sell it.”

Governor Juffa said Lockyer would not have paid PNG any heed “if he wasn’t lobbying for his company to be given all green lights for coal, a substance that is helping accelerate global warming and contributing to all the consequences”.

Civil organisation, Nogat Coal PNG, said:

“Last month Darren Lockyer’s company, Mayur Resources, announced they would be building a coal power plant to process cement at their Central Cement and Limestone (CCL) facility just outside Port Moresby near Papa-Lea Lea.

“It’s just insane that in 2020 with the climate crisis doing huge damage everywhere that coal would even be considered. There are cheaper better and cleaner solutions for making cement and powering electricity than coal.

“Lockyer, your entire country is on fire from the impacts of coal.”

Global campaigning organisation, Greenpeace, says coal is the single largest contributor to global warming and currently, one-third of all global carbon dioxide emissions come from burning coal.

“Additionally, scientists are increasingly clear that in order to avoid the worst impacts of climate change, we need to leave 80 percent of global carbon deposits — like coal — in the ground.”

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PNG PM urges multi-nationals to allow gas project to proceed

Papua New Guinea’s prime minister James Marape. Photo: PNG PM Media Unit

Radio New Zealand | 8 February 2020

Papua New Guinea’s prime minister has urged two energy companies not to hold a major LNG gas project in his country to ransom.

James Marape’s appeal to ExxonMobil and Oil Search follows the failure of negotiations with the former over the fledgling $US13 billion P’nyang gas project

Oil Search said PNG was demanding terms of Exxon that meant the project developers would not gain a sufficient return on their investment.

But Mr Marape accused Exxon of a “lack of interest” to meet PNG halfway by offering concessions for a better state take from the deal.

The failure of the negotiations has raised doubt over the future of the separate Papua LNG gas project signed with French major Total.

Mr Marape said he called upon the two multi-nationals, as beneficiaries of concessions previous governments have given, to work with Total to deliver Papua LNG.

However, he appeared to leave the door open for an agreement with Exxon over the P’nyang gas project proceeding.

He said in the interests of fairness, a Ministerial Gas Committee would request both the state negotiating team and ExxonMobil to present their positions for the State – through a committee of leaders – to decide what is the best outcome for PNG.

The prime minister said he had indicated on all levels of discussions that fundamental policy principles that influenced his government’s mindset would not change.

“These include no fiscal concessions in P’nyang, treating P’nyang as separate from both PNG and Papua LNG projects, increase in Domestic Market Obligations and local content participation,” he said.

“These will be fundamental in progressing P’nyang.

“In the meantime, I call upon ExxonMobil and Oil Search not to hold the Total project in Gulf to ransom.

“If you model the project to be uneconomical, then don’t push it: let’s leave the gas in my land and you develop Papua plus further work in PNG LNG.

“After SNT and ExxonMobil present to the MGC, Cabinet will decide on P’nyang.”

Mr Marape said his government would shift focus to Wafi-Golpu and Porgera mines, and other resource sectors so life in PNG was not only dependent on P’nyang and other LNG gas projects.

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