Tag Archives: Exxon-Mobil

Papuan landowners in PNG to receive first LNG project royalties of K15m

Boera village in Central province landowners from the PNG LNG Project to receive royalties. Video: EMTV News

Meriba Tulo in Boera village | Asia Pacific Report | September 13, 2017

After more than three years and 200 shipments, landowners of Boera village in Papua New Guinea’s Central province have became the first beneficiaries from the PNG LNG Project to receive royalties.

This followed the release of royalty benefits for PNG LNG Petroleum Processing Facility Licence 2 (PPFL2) area landowners to the Mineral Resources Development Company (MRDC) from the Department of Petroleum and Energy, Department of Finance, and the Central Bank.

Royalty payments for the four villages of Boera, Papa, Porebada and Rearea are in line with the Ministerial Determination number G692, 2015, which will see 83 clans receive a share of K15.6 million (NZ$6.7 million).

According to the Oil and Gas Act 1998, only 40 percent is to be paid as cash disbursement to landowners, with the remaining 60 percent to be set aside in two trusts – the Future Generation Trust Fund (FGTF) and Community Investment Trust Fund (CITF).

Royalty Payment Allocation:
1. Cash Payment to Landowners: K6,250,701.00
2. Community Investment Trust Fund: K4,688,026.00
3. Future Generation Trust Fund: K4,688,026.00

From the K6,250,701.00 cash allocation, this is further broken up according to the following:
1. Rearea Village: K1,746,946.00
2. Papa Village: K1,746,946.00
3. Boera Village: K1,352,027.00
4. Porebada Village: K1,154,755.00
5. Others: K250,028.00

Meriba Tulo is a senior reporter and presenter and currently anchors Resource PNG as well as EMTV’s daily National News. EMTV News items are republished by Asia Pacific Report with permission.

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K15M For LNG Plant Site Landowners Delayed Again

Melissa Yafoi | Post Courier | September 7, 2017

Highlands landowners from the LNG resource site yesterday stopped the K15 million payment for their coastal counterparts.

And their actions are likely to cause a shutdown at the plant site in Port Moresby as a result.

They insisted no payments be made until their own houses were put in order including the clan vetting process and other outstanding payment commitments made by the O’Neill government over the years were honoured.

They said failure to pay them will result in their shutting down of the project from the upstream end.

Their action is likely to result in the same threat from the coastal provinces who have resolved their outstanding clan ownership issues and only awaiting the first K15 million payment.

The Central landowners were about to be paid the amount having fulfilled all the legal requirements until yesterday when a demand for stop payment was made to the government through the Department of Petroleum and Energy.

The LNG site landowners insistence were despite court actions and disputes and the outstanding clan vetting process on ownership of the land which the project is located delaying their payments.

All monies owed to them are banked in trust accounts including those from Central Province.

In the ransom-like situation newly appointed Petroleum and Energy Minister Fabian Pok was caught off guard lamely saying he was new to the job and needed more time to understand the outstanding issues.

This is despite the Government’s previous hard line stance in paying landowners that resolve their landownership issues ahead of those pending in courts, the mediation process and other resolution arbitration.

Departmental Deputy Secretary Kepsey Puiye and Mineral Resources Development Company Limited external affairs general manager Imbi Tangune also succumbed to the demands saying it was sensitive and payment would not be made to the Central landowners.

Mr Puiye said the K15 million will be paid to the plant site land owners once the minister gives his approval.

He said of the amount 60 per cent will be kept by MRDC as per the Oil and Gas Act under section 176 and only 40 per cent will be paid for immediate investment.

“This is one of the very important projects that will have a profound effect on the economy of the country that is why it is important that the minister needs to appreciate all the issues for the upstream.

“Because the upstream holds the pipeline and that is important so the minister is also very cautious of the implications it will have on the upstream landowners because projects such as this is fundamentally important so he is saying let me look at the issues first.

“The plant site landowners need to appreciate that once the upstream is not alright then we are going to destroy the project,” he said.

Mr Tangune added: “I’m actually very sensitive to the minister’s need to ensure that he understands the issues surrounding payments for the plant site, licence areas and the pipelines so when he is actually comfortable he will give us the timeline for us to make that payment.

“We’ve done everything and the money is with us and we have done everything to pay the money to the land owners.

We ask our landowners to be patient because money is coming, it’s not an issue of its not, it’s an issue of when and I think we have done everything possible to give money to landowners whatever they are entitled to.”

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Benefits Delivery From PNG LNG Must Improve

Oil Search Managing Director Peter Botten Has Called For An Improvement On The Disbursement Of Funds Owed To Landowners Of The PNG LNG Project

Post Courier | August 21, 2017

Oil Search managing director Peter Botten has called for an improvement on the disbursement of funds owed to landowners of the PNG LNG project.

The calls are in light of the ongoing debate pertaining to the benefits being derived from the oil and gas business.

Speaking at a business breakfast last week hosted by the Business Council of Papua New Guinea (BCPNG), Mr Botten told business and government leaders including the Prime Minister Peter O’Neill, that he believed there is a broad feeling that the recent developments have delivered little over the last few years.

“Benefits delivery from PNG LNG must improve. Landowners must be paid.

“The money is there, some have already been paid but barriers to revenue distribution must be removed,” he said.

“Over K3billion has been paid by the project in royalties, development levies and equity distributions to the State and landowners since 2014.

“Maybe not as much as some people expected but still it’s a considerable sum,” the managing director said.
Prior to these statements, Mr Botten had told the business and government leaders that with the right environment oil and gas production can more than double over the next five to seven years.

“Potential investment over K60billion in developments, appraisal and exploration are possible in this time frame. Construction can lead to over 20,000 new jobs with significant other spin off economic activities,” he said.

However he stressed there were many issues to resolve to make this happen.

He said a prerequisite to success is developers engaging with government, landowners and indeed the whole country to demonstrate fair value distribution for all parties must be achieved from existing projects.

“One that people feel is right value for resources extracted, one where developers work with state to deliver infrastructure address service delivery and support both economic and social development of the country,” Mr Botten 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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PNG LNG Willl Not Be Another Bougainville Crisis: Duban

The Mention Of Another Bougainville Civil War , As A Result In The Delay In The Payment Of The PNG LNG Project, As Speculated In The Debates In Australia In The Past Few Days “Is Nonsense And Unwarranted”.

Post Courier | June 14, 2017

The mention of another Bougainville civil war , as a result in the delay in the payment of the PNG LNG project, as speculated in the debates in Australia in the past few days is nonsense and unwarranted.
Petroleum Minister Nixon Duban was responding to questions put to him by the Post-Courier, on Tuesday, pertaining to reports carried in the overseas media on this issue.
While also in light of reports that had surfaced over the weekend of a planned protest by aggrieved landowners from the Central Province.
The protest did not eventuate at the plant site outside of Port Moresby.
However, the issue of royalty payouts to landowners came under the spotlight in Australia when questions were raised, by one of its senators as to why the Australian government through its Export Finance Insurance Corporation (EFIC) had not taken measures to ensure royalty payments were made.
The minister had expressed disappointment that some senior politicians had joined in the chorus inciting fear in the whole debate, reminding them that they were part of the O’Neill government until recently.
He had reiterated that the main reason for the delay of payment in the early payment of landowner benefits, was that many legitimate landowners had not been identified in the project area in Hela.
Mr Duban said PNG LNG project has a lifespan of over 50 years.
He said the landowners were fully aware and would not destroy something that would sustain their livelihood and that of the generation to come.
“Bougainville stemmed out from serious discontentment over what was poorly structured landowner benefits package.”
“PNG LNG landowners are given a much better deal with the foundation LNG project showing significant signs of expansion.
“I believe the growth potential will come with new opportunities and improved better deals for PNG and our landowners,” he said.
He assured investors and stakeholders that the project was in safe hands.

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Spotlight on Australian govt financing role in LNG Project

“So the Australian tax payer’s getting paid and the population of PNG is not”

Radio New Zealand | 13 June, 2017

The Australian government’s Export Finance Insurance Corporation has been questioned in the senate about its role in Papua New Guinea’s LNG Project.

EFIC’s US$350 million loan to the PNG LNG Project was the biggest ever foreign loan made by Australia’s government.

There’s been particular scrutiny applied to EFIC’s response to the non-payment of royalties to LNG Project landowners.

PNG’s LNG Project, lead operated by ExxonMobil, has been successfully shipping annual exports worth billions of dollars since 2014.

However landowners in the project area say they have not been paid royalties promised them under the project’s founding agreement, estimated to total US$300 million.

Western Australia’s Senator Scott Ludlam took EFIC to task over why it had not taken measures to ensure payments were made.

“So I understand that, May 2017, the 300th shipment of LNG left Port Moresby, but the payment of royalties owed to landowners under benefit sharing arrangements hasn’t even begun,” he said.

EFIC’s director of environmental and technical review, Jan Parsons, told the senator royalties were not its responsibility.

“It’s the benefits, the royalties as you say, which only started flowing after LNG gas started being exported.”

“That is the part which is managed by the government, and the project has no role in that, legally or morally, if you like,” he said.

“And my understanding of the problem that’s holding up the distribution of those payments is identifying the actual people who should be receiving the payments.”

Senator Ludlam sensed EFIC was trying to distance itself from its project obligations, by identifying royalties as strictly a government matter.

“It’s easy to say that it’s not a project matter. But landholders have been dispossessed. They’ve been told that they’d be paid out.”

“There’s an amount of benefits which I understand is in the range of 400 million Australian dollars which hasn’t actually hit the ground. And this thing is busy exporting PNG LNG over the horizon.”

According to PNG’s Treasurer for the past three years, Patrick Pruaitch, the identification process Mr Parsons referred to, or clan vetting, should have been completed well before the first LNG shipment left PNG’s shores.

Mr Pruaitch admitted the Peter O’Neill-led government, of which he had been a key member until recent weeks, had failed to resolve this issue.

Jan Parsons would only offer that the Project was trying to help the government in identifying the landowners who should receive the royalties

“And in speeding up the payments, because it’s in the Project’s interests. But that’s something the project is doing, not as a legal matter, but being a good neighbour, if you like.”

Senator Ludlum mentioned reports of an arms build-up and escalating tensions among landowners in the region where LNG Project’s well heads are based, the Highlands province of Hela.

“When does the Commonwealth start to get its money back?

EFIC”s chief credit officer John Pacey stepped in to answer the question

“Repayments have already commenced.”

“So the Australian tax payer’s getting paid and the population of PNG is not. That seems a little peverse,” Mr Pacey said. 

“What are the risks to Australia being repaid if we end up with another Bougainville on our hands through civil unrest, armed or otherwise, in the impact area where people are likely pretty pissed off that they’re 400 million dollars short of the royalties that they’re owed?”

Export Finance Insurance Corporation wouldn’t be drawn on impacts of a “hypothetical” situation, telling the senator it had evaluated risks of the project, but not specifically about the potential for armed conflict in relation to the project.

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Landowners threaten to shutdown LNG Operations

NBC News | PNG Today | June 12, 2017

Landowners in the Central Province are set to close down the PNG LNG site on today over unpaid compensations demands since 2014.

They held a meeting with representatives from operator ExxonMobil, Department of Petroleum and Energy, PNG Ports and Police yesterday.

The meeting was to stop the people, comprising four beneficiary villages of Papa, Lealea, Boera and Porebada from staging their protest.

However, landowner spokesman and Association Secretary, Robert Kauga said, their minds are made up and they won’t back down on their decision to carry out the protest until the government pays them their outstanding royalties and equities.

Mr. Kauga said the people are already fed up with the continuous lies and promises of payment by the government.

“They are admonishing us not to stage the protest but we cannot back down now, we have already prepared everything,”he said.

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