Tag Archives: FPIC

Landowner identification in PNG: a job for government

Credit: Celine Rouzet

Peter DwyerMonica Minnegal | Devpolicy Blog | March 21, 2019

The Papua New Guinea Liquefied Natural Gas (PNG LNG) project commenced exporting gas to China, Korea and Japan in May 2014. Under agreements reached in 2009, landowners of eight petroleum licence areas, eight pipeline licence areas and a liquefaction plant site near Port Moresby were to receive royalties. By February 2019, payments had been made to people in only the last of these areas. The identification of landowners has been a major difficulty, and assigning responsibility for completing the task has been a matter of debate.

At the close of 2018, social mapping and landowner identification studies carried out by consultants to petroleum companies, clan-vetting exercises carried out by officers of the Department of Petroleum and Energy, and alternative dispute resolution processes implemented by the judiciary had failed to solve the problem. By this time too, agreements for two other LNG projects (in Western Province and Gulf Province) were under discussion. In January 2019, Petroleum Minister Fabian Pok told parliament that the government would not repeat the mistakes of the first LNG project. He wanted the companies to be responsible for identifying landowners in the new LNG project areas and he wanted this done before those projects moved to production. On January 23rd, referring to the Gulf Province LNG project, Prime Minister Peter O’Neill said that the government “had tasked the developer to do the landowner identification process” and Minister Pok reported that Total – the developer – had agreed to do this.

The small print is not yet to hand so we cannot be sure just what the government has requested or what Total has agreed to do. Here, however, we argue that ceding responsibility for landowner identification to the petroleum companies is a seriously bad idea – bad for the companies, the government and for the people of Papua New Guinea.

Under the Oil & Gas Act 1998, final determination of landowner beneficiaries for a petroleum licence area is to be made by the responsible minister and gazetted as a Ministerial Determination. Recent determinations provide a record of landowner beneficiary identification for specified licence areas or pipeline segments. Those determinations name clans (variously ‘major clans’, ‘stock clans’, ‘beneficiary clans’) but do not name individuals within those clans. With reference to differential benefit-sharing arrangements they may subdivide clans as ‘highly impacted’, ‘least impacted’ and ‘invited’.

The diagram below shows some categories of landowner beneficiaries appearing in recent determinations and in clan-vetting exercises that precede and feed into those determinations. On the diagram, the boundaries of the lands of clans A to G are shown relative to a Petroleum Development Licence (PDL) area. Clans A, B and C are classed as landowner beneficiaries on the basis of long-term residence and use. Clans D and E are ‘invitees’ initially recognised as landowner beneficiaries on the basis of boundary-sharing with A, B or C with the possibility that they are subsequently granted equivalence with those clans. Clan F is classed as a landowner beneficiary on the basis of asserted ancestral connection and an ideology of rights to land being held in perpetuity. Clan G is an ‘invitee’ recognised as a landowner beneficiary on the basis of assistance rendered to A, B and C. H is a private citizen, or group, that holds registered title to a portion of the PDL area and, on this basis, under the Act is a landowner beneficiary.

The concept of ‘landowner’ is being used here in a broad and fluid sense. It is not used in agreement with any likely academic definition, with any detectable legal rigour or in conformity with a pan-PNG ideology of tenure because, of course, there is no pan-PNG ideology of tenure. The Oil & Gas Act requires that a company applying for a PDL must submit a “full-scale social mapping study and landowner identification study of customary land owners” of that licence area. Under the Act, customary landowners are persons whose relationship with the land has to do with “rights of proprietary or possessory kind”. Not all clans identified as landowner beneficiaries in Ministerial Determinations satisfy this definition. And the status of others, both the included and the excluded, as members of this category will be always amenable to contention. Several possibilities are implied in the diagram.

For example, a judgement that clan C was ‘more impacted’ than A or B because all land attributed to C is within the PDL area while portions of land attributed to A and B lie outside that area, could be challenged by the latter clans on the basis of area or numbers of people affected. Similarly, members of A, B or C could well have different opinions regarding acceptance of D or E as ‘invitees’ and their possible upgrading to the status of landowner is even more problematic in being politically, rather than empirically, motivated. Inclusion of F as landowner will be dependent on assessing the validity of accounts of ancestral connections from claimants who may well have competing agendas. Finally, inclusion of G could elicit claims from other clans that assert that they too provided assistance to A, B and C. Resolving problems of these kinds cannot be achieved by an anthropological study of ‘in situ’ land ownership. These sorts of problems are ultimately resolved only by facilitated negotiation with those charged with identifying landowners, or by litigation.

No petroleum company can produce a list of clans that will conform to, or satisfy, the sorts of decisions that currently inform Ministerial Determinations. They did not do so in the past and they cannot do so in the future. If companies now assume responsibility for producing a definitive list of landowner beneficiaries, there will no longer be any ambiguity about who to blame or who to take to court when the list is considered defective. The fault will be theirs. On these counts, the desire to shift responsibility – or at least the perception of responsibility – to the petroleum companies might, in the short term, prove beneficial to the government in domains of financial management and public relations.

There is, however, another reason why responsibility for identifying landowners should remain with the government. Only Papua New Guineans – the PNG government, courts, and the landowners themselves – can determine who owns the land in Papua New Guinea. This responsibility should not be ceded to outsiders. It should not be ceded to American, Australian, Chinese or French companies. Papua New Guinea is not their country. They are guests. Only Papua New Guineans can determine what is right for Papua New Guinea. The petroleum companies should recognise and acknowledge this and step back from this area of decision-making. The government should also recognise and acknowledge this and step forward to ensure that the rights of all Papua New Guinean woman and men are guaranteed by Papua New Guineans.

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ID landowners first, says MRDC

Armed clansmen in the town of Komo in Papua New Guinea’s Hela Province. Photo courtesy of Michael Main

The fact this even needs to be said is a terrible indictment of our Nation’s mis-management of resource extraction industries over decades. If social mapping and proper landowner identification is not being done then there can be no free, prior, informed consent and most projects are simply illegal.

The National aka The Loggers Times | March 20, 2019

THE issue of social mapping and landowner identification must be done prior to the commencement of any project, says Mineral Resources Development Company managing director Augustine Mano.

He said it should not be left till very late as was the case with the PNG LNG project.

Social mapping and landowner identification for the PNG LNG project took 10 years to complete.

“It must be the first thing to be done in any future project in the country,” Mano said.

He said for the Papua LNG and the P’nyang projects, landowners or beneficiaries were identified prior to the development forum so that only they were involved.

He said that was important for project security because it was different from other countries where genealogy was documented properly over the years.

Mano said the MRDC as the landowner fund manager was making sure that the benefit distribution was done according to the Oil and Gas Act – 40 per cent to the landowners, 30 per cent for community infrastructure and 30 per cent for further investments.

The secretary for the Department of Petroleum, Lohial Nuau, said landowners issues were now being better managed.

He said the department had taken stock of outstanding government commitments under the various agreements which would be channelled through the Independent Issues Committee.

“This is positive step towards improving landowners issue management,” he said.

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Second Wave Due Diligence: The Case for Incorporating Free, Prior, and Informed Consent into the Deep Sea Mining Regulatory Regime

A new article, Second Wave Due Diligence, published in the Stanford Environmental Law Journal calls for the norm of free, prior, and informed consent (FPIC) for indigenous peoples to be applied to deep sea mining (DSM) projects carried out in the international seabed, particularly in the Pacific region, where numerous indigenous communities stand to be directly and disproportionately impacted by this new extractive industry.

Authors Julian Aguon and Julie Hunter’s argument, while novel, relies on core prescriptions of Part XI of the United Nations Convention on the Law of the Sea (UNCLOS) requiring compliance with international law in general, including pertinent rules of international environmental and indigenous rights law.

UNCLOS’s clear parameters on the prevention of harm to the marine environment, expounded upon by the International Tribunal for the Law of the Sea in a series of key decisions, have created a due diligence standard that is imposing ever higher duties on an increasingly wide range of actors, including in areas beyond national jurisdiction.

This standard is evolving alongside a robust norm requiring the FPIC of indigenous peoples threatened by large-scale extractive activities, even if those activities are not directly carried out on indigenous land.

When applied to DSM, whose exploratory stage has already resulted in an array of adverse impacts to Pacific indigenous peoples, these normative legal developments coalesce into a compelling argument for placing impacted indigenous peoples into key decision-making roles.

Such an approach, which is called a “second wave” of due diligence, represents a decisive break from a destructive history in which the Pacific served as a proving ground for the experiments of others, and a concrete step toward sustainable, rights-based development in the twenty-first century and beyond.

Download: Second Wave Due Diligence

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Consultation or slick sales pitch?

The deep seabed minerals consultation on the northern group island of Penrhyn.

This is an all too familiar problem in Papua New Guinea…

June Hosking | Cook Island News | February 4, 2019

The deep seabed minerals consultation held in Mauke last week leaves me asking, yet again, ‘what should a consultation look like?’ The dictionary says, in short, ‘A consultation is a meeting to deliberate a matter. Deliberate means to weigh up both sides.’

Therefore, for a real consultation we need to hear both sides. It would have been great, for example, to have heard from a Maori speaking scientist like Dr Teina Rongo on what could go wrong. From where I sat all we got was a slick sales pitch with some question and answer time tacked on the end. But if people don’t really know the issue they don’t have real questions to ask.

Throw in talk of money and the conversation is nicely side-tracked. The majority of time was given to selling the idea of seabed mining and how much money it’ll bring in. It is a sales pitch when one starts talking about what mining will buy for the island. Besides mentioning the possible amount of income, I don’t believe they should be allowed to talk about specific spending, as that is basically bribing for a vote.

Health and education are a required part of government budgeting, whether there is mining or not!

Had it not been for one frustrated person asking for the meeting to head to its advertised purpose – the bill, we may never have touched on it at all. When we did, Paul produced what he hands out at Parliament- a double sided A4 page summary of the 57 page Seabed Minerals Bill.

Apparently many politicians don’t get around to reading the whole document. It angers me that we’re paying politicians to read just two pages and frightens me that they could, without having really checked out the whole bill, make critical decisions affecting our future.

I wouldn’t be surprised if no more than five people on Mauke read the whole bill, so after a whizz through the two pages, the MC decided it was time to say grace for the kai manga. He asked for a shout out on who agreed (no specifics) and wasn’t impressed when I stood up to bring attention to the screen noting ‘questions and answers time’. As you can imagine, that time was extremely brief and then it was all over.

I did make use of Q&A opportunities and was told others had expressed similar concerns, but they weren’t the sorts of things to be in a bill.

They would be in the licensing process. I realise that at this stage we’re talking about exploration, but no one in their right mind is going to pour money into exploration without expecting to gain a mining license if they request it. So I’m looking long-term.

The following are my concerns on environmental aspects:

1.    The precautionary approach has a loophole. It suggests to me that if warning bells ring and it’s not cost-effective to avoid disaster, then you can go ahead anyway. It should say if it’s not cost-effective, then you stop altogether.

2.    What happens if there is a leak? How long will it take to discover a plume of sediment that could be devastating to ocean life higher up the column? Even if the pumps are immediately stopped there will be something like 10km of sediment in the pipe leaking out until the break is found and fixed.

3.    Biodiversity preservation areas must be compulsory so that for every mined area (which will become a desert) an equivalent area is zoned untouchable.

4.    Part 5 of the Bill talks about liability, but what do we do if a big company refuses to accept responsibility or to fix damages, as has happened with TMV’s leaky joints in Raro? Is it possible to require some massive bond up front?

5.    Schedule 2:5 says you have to get additional consent for high-risk activities. If evidence arises that to proceed is likely to cause serious harm to – (a) marine env. (b) safety, health or welfare of persons (c)other existing sea uses. Does it make sense to give consent for serious harm?

6.    Schedule 2:6 discusses dumping. We need to state clearly in black and white that ‘sediment must be returned to its place of origin’.

7.    Point 23 describes the composition of the Committee. There have to be at least seven members. Four of these are politically appointed. Is this right?

Finally, meitaki nui to Gerald McCormack for producing such an easy to read and interesting small book on seabed minerals. I hope this book is compulsory reading for every politician. Our future depends upon your decisions.

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Under-MINING Morobe: Wafi Golpu and the struggle for Morobean sovereignty

Martyn Namorong | December 19, 2018

I have a strong affinity for Morobe province. Although I am not from the province, my surname -Namorong- is Morobean. I won’t bore you with the long tumbuna stori but it has something to do with a young Lutheran pastor from Tapen in the Rai Coast climbing the “hundred mountains” of the Finisterre Range and working with the people of Teptep in the 1970s.

The first time I entered the debates on the extractive sector in Morobe, was in 2012, when communities along the Watut and Markham rivers reported fish and eels dying after what they believed to have been related to a cyanide spill from the Hidden Valley mine (Same miners now involved in Wafi-Golpu).

Last year, with assistance from generous development partners, I ran a workshop in Lae bringing together government officials and community leaders from mining communities associated with the Hidden Valley and Wafi Golpu projects. My interest as well as that of the funders was to educate and empower sub-national leaders on PNG’s extractive sector. An overview of PNG’s mining regulatory framework was presented by the Mineral Resources Authority.

I have since had the privilege of meeting and listening to landowner and provincial government representatives. One such meeting ironically happened at the 8th floor conference room of Treasury building, where landowner representatives were lobbying for the Open Book Financial Modelling of the Wafi-Golpu project.

Katim na skelim Pik

One of the hot topic discussions of any resource project is benefit sharing with local stakeholders, colloquially referred to has “katim pik”.

For a faction of Wafi-Golpu landowners, having access to the Open Book Financial Modelling is critical to them in informing their decision making regarding the project.

What the Open Book Model does is it mathematically models the “size and weight of the pig” so to speak and then predicts the financial implications of “cutting the pig” in a certain way.

Say for instance, it predicts how much profit or loss the project will make depending on an upper and lower limit of the World Market price of copper.

During the Wafi Golpu Memorandum of Agreement (MOA) discussions held in the middle of this year, Treasury Officials told local Morobean parties that they had access to the Open Book Model.

Landowners and Morobe Provincial Government officials have since been pursuing that model from Treasury.

Now under PNG Mining and Petroleum laws, the Development Contract for a resource project is negotiated by the National Government and the company wanting to exploit the resource.

The Provincial Government, Local Level Government and Landowners only come into the picture after the Development Contract is signed. Their participation is only at the Development Forum stage where benefit sharing agreements are signed between the National Government and sub-national parties.

This procedure exposes a fundamental flaw – landowners and provincial governments are not party to discussions on how the pig is cut.

So what happens in PNG is that by law the government and a foreign corporation cut the pig and then the government redistributes its share with the sub-national stakeholders. If government officials negotiate poorly as they have notoriously done previously, provincial governments and local governments including landowners are given the “pig skin” instead of “meat”.

Free Prior Informed Consent and Contract Transparency on Wafi-Golpu

Morobeans, under the international principle of Free Prior Informed Consent (FPIC) that is aimed at protecting the rights of vulnerable ingenious communities, have a right to information that will help them make informed decisions about the Wafi-Golpu project.

Access to critical financial modelling information is important even if PNG law doesn’t cater for their interests at this stage of project negotiations.

National authorities have historically failed in their fiduciary duty to protect the interests of local authorities and landowners. The Morobeans therefore have every right to be sceptical about whether Waigani will protect their interests during negotiations of the Wafi-Golpu Development Contract.

Contract transparency following the principles of the Extractive Industries Transparency (EITI) that the government of PNG has signed up to are therefore crucial in building understanding and trust between all stakeholders and not undermining the interests of the people of Morobe during negotiations of the Development Contract.

Morobeans aren’t naive

Morobeans have had their first mining experience from Bulolo and Wau Gold fields. Today they live with the Hidden Valley mine for better or for worse. They know the same dodgy characters from Hidden Valley are know plying their dirty trade at Wafi-Golpu.

Perhaps for me, the most poignant moment was at the Sydney Mining and Petroleum Investment Conference, seeing highly educated Morobeans urging their governor not to sign the MOA with Wafi-Golpu project partners when rumours were spreading at the conference venue that the Mining Minister and Prime Minister were keen of getting the Governor to sign.

Hats off to the Morobe Governor and Landowners of Wafi-Golpu. I hope that your actions will lead to improvements to how PNG’s natural resource contracts are negotiated and that PNG has broader contract transparency consistent with the EITI global standard.

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Australian mining interests in north Bougainville

Jubilee Australia

While the Panguna mine – one of the largest operating copper-gold mines in the world until the Bougainville crisis forced its closure in 1989 – might grab the attention of many people, there is more going on in Bougainville in relation to mining in than just Panguna. As at the beginning of 2018, four exploration licences have been issued to Australian, Canadian and Filipino mining companies.

Australian company Kalia Holdings holds some of these licences and is exploring for copper and gold in the Mt Tore region in North Bougainville.

We are concerned that affected communities have not given their free, prior and informed consent for Kalia Holdings’ activities. In particular we are concerned at reports that women have been sidelined, and that the people who are making decisions supposedly on behalf of landowners do not always have customary rights to the land in question. Much of Bougainville is a matrilineal society and land entitlements pass through women to their children. Women are custodians of the land and as such must be involved in all decision-making as it relates to land and to mining.

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Fiji: No short cuts to dealing with community grievances on mining

FCOSS executive director Vani Catanasiga. Picture: FT FILE

The Fiji Times | 29 August, 2018

There are no short cuts or easy solutions to dealing with community grievances and disputes arising from mining or extraction says the Fiji Council of Social Services (FCOSS).

FCOSS executive director, Vani Catanasiga shared the sentiments after presenting to the UNDP-organised ”Addressing grievances and disputes from the Development Mineral” Capacity Building Workshop in Nadi

Catanasiga who presented on “Free, Prior, Informed Consent – A proactive approach to dealing with community grievances and disputes in extraction”  said while development stakeholders favour  a faster and more efficient approach to dealing with community grievances and disputes, this approach undermined the community’s right to decide on projects that could affect them adversely.

“Working to obtain Free, Prior and Informed Consent or FPIC is about involving communities the right way so that development can have a lasting and positive legacy for both communities and companies,” she said.

“FPIC is an intentional process that should avail to affected communities information on government, business or banks that are stakeholders in the project, project details in their preferred language as well as convening community discussions that involve everyone – including women, children, elders, non-indigenous neighboring settlements – to discuss project terms.”

She said using FPIC could be a proactive approach to dealing with community grievances arising from access to and utilisation of natural resources.

“So yes it may seem, a long and sometimes difficult process but ultimately as you mainstream FPIC into your approaches, you indirectly build communities’ sense of ownership into ensuring the success of the project because you have included them,” she said.

Catanasiga said FPIC is emerging as a best practice approach for people centred development around the world because it promotes the inclusion of all communities that will be affected by proposed development projects.

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