Tag Archives: Julius Chan

PNG New Ireland Deputy Governor Tells Social Media Mining Critics : Get Smart or Get Screwed

Pacific Mining Watch

 Papua New Guinea’s Deputy Governor of New Ireland, Sammy Missen, said today that it is actually amusing to see all the talk on social media about the failure of politicians to take action to make the mining sector work better, to the benefit of the people of the country.

Mr. Missen said “I find it amusing, because all these people are just missing the point. If they are so concerned about making changes in the Mining Act, then they should start supporting those who really want to make changes rather than just complaining all the time.”

The Deputy Governor said that there is one politician in the country who is serious about making the Mining Sector work to the advantage of the people. “That person is Sir Julius Chan. Sir Julius has been saying for more than ten years that the Mining Act should be changed. He has been saying that the current Mining Act takes huge wealth from the landowners and only gives them a few toea in return. Sir J says that the landowners should get automatic ownership in any mine. Landowners should never have to buy shares in a mine – they should get shares free, automatically. The gold and the copper and the nickel is in OUR ground.”

And, Mr. Missen said, “Sir J says that any company that wants to come in an operate a mine should be able to do so, but they will just be contractors. The owners of the mine will be the owners of the land – the State, the Province or the landowners, whoever owns the land where the mine is operating. And the benefits to the landowners will go up by five times from what they are now. Em tasol.”

Mr. Missen said that Sir Julius has been trying to make these changes in the Mining Act for years. “Almost three years ago Sir J introduced a Private Member’s Bill to Parliament to Revise the Mining Act. But the O’Neill Government did not act. And when the Marape Government came to power one of the first things it did was to invite a New Ireland Team to sit down with him and explain how the Mining Act should be revised. The Prime Minister said he would support those changes, but so far nothing has been done.”

Mr. Missen said criticism of the Mining Minister, the Hon. Johnson Tuke, is misplaced. “Minister Tuke fully supports the changes Sir Julius has proposed,” he said. “He supports giving ownership of the mines to the people who own the land, increasing royalties for the people and increasing all benefits coming from mining. But he can do nothing without the support of the Prime Minister.”

“And that is what people should understand,” said the Deputy Governor. “They should stop criticising everyone, and realise who their friends are. They should realise that they have an ally in Sir Julius. They have an ally in Minister Tuke. What the people need to do is to Get Smart. The need to telephone their MPs email their MPs, go on social media and tell their MPs they demand that they support the changes Sir Julius wants to make. The people need to make some NOISE! They need to demand a Revised Mining Act that will make the people rich from the wealth that is coming from THEIR ground.”

“And if their MPs do not listen to them,” Mr. Missen said, “if their MPs do not support giving the people a much larger share of the benefits, then the people need to make it very clear that those MPs will not get their votes in the next election. That is the only thing politicians understand. The People must tell their MPs one thing – if you refuse to support changes to the Mining Law that will benefit us, then you will no longer represent us. Em tasol!”

“And that,” Mr. Missen concluded, “is what people should be doing. They need to Get Smart. They need to realise who their friends are, and support them. If people just continue to moan and groan and refuse to work together, all our mines will end up just big holes in the ground, and all the wealth from them will be sitting in foreign bank accounts!”

In closing, the Deputy Governor said, “I can tell you one thing for sure. If we don’t Get Smart, we will surely Get Screwed!”

Leave a comment

Filed under Environmental impact, Financial returns, Human rights, Papua New Guinea

Call for change in resource sector laws

Julius Chan is one of the founding fathers of political corruption in PNG

The National aka The Loggers Times |  July 8, 2019

ONE of the founding fathers of the nation [and of political corruption] believes in changing the colonial laws governing the resource sector.

New Ireland Governor and former prime minister Sir Julius Chan, who has been fighting for fair and equal benefit sharing and ownership of resources in the country, said now was the time to take back the country.

He said for the good of the nation, it was time to take back the resources and give it back to the people by legislating resource benefit laws.
Sir Julius said Papua New Guinea exported more than K30 billion worth of resources (in oil, gas, copper, gold, nickel and the agriculture and fisheries) each year but only a small percentage of that remained in the country.

He said of the K30 billion, only about K5 billion was retained in the country through taxes, royalties and equities while the rest was taken out unlike other countries who had a greater return from their resources.

“Many countries get almost half the value of their resources from what they export so we must change,” he said.

“We must change our laws and we must take back the country back as the prime minister said.” He said among them was the laws governing the resource sector that needed to be changed to take back what rightfully belonged to the people and the country.

Sir Julius, debating on the economic status of the country, said the landowner rights and resources were given away when development licences are issued.

He said landowners and government paid for the equity from their share and that needed to change for greater benefits to flow back to the people.

“The landowners and provincial governments are given two per cent equity and development levies yet the companies get that back through tax rebates so in fact the companies or developers pay nothing, the people are paying for their own royalties, the company is paying nothing.”
Sir Julius said the country was in an economic crisis.

“Over the last five years, we have not been true to ourselves,” he said.

“We have been over estimating our budgets revenues and underestimated our expenditures so each years we have ended up with a far higher budget deficit.

“We need to admit we have a problem.”

Leave a comment

Filed under Financial returns, Papua New Guinea

Political disarray in Papua New Guinea rocks Oil Search shares

Tom Westbrook and Sonali Paul | Reuters | May 27 2019

Political turmoil in Papua New Guinea threatened to delay a $13 billion plan to double the country’s gas exports, sending shares in one of the project’s partners, Oil Search Ltd, down nearly 4% on Monday.

PNG Prime Minister Peter O’Neill said on Sunday he would resign after weeks of high-level defections from the ruling party. Sir Julius Chan, twice a former premier, would take over as the government’s leader, O’Neill said.

Political instability is not unusual in Papua New Guinea and has not held back mining and energy investments in the resource-rich country, however protests over benefits failing to reach rural areas have dogged the government and project owners.

It was not clear whether Chan could command a majority in parliament when it resumes on Tuesday.

“We will not choose him. It’s a really bad choice,” opposition lawmaker Allan Bird told Reuters in a text message.

“We want a complete break from O’Neill (and) Chan is just a proxy for O’Neill,” he said.

Chan said on Monday he had been approached by both the government and the opposition to take the role.

“This is not a position I am seeking,” he said in a statement. “However, I love Papua New Guinea, and there is a desperate need right now to unite the country … and to make the wealth of this country work to the benefit of the people of this country.”

O’Neill had resisted calls to resign for weeks but his opponents said on Friday they had rallied enough support in parliament to oust him over a range of grievances, including a gas deal agreed in April with France’s Total SA.

The deal with Total set the terms for developing the Elk and Antelope gas fields, which will feed two new liquefied natural gas (LNG) production units at the PNG LNG plant, run by ExxonMobil Corp.

At the same time, ExxonMobil and its partners are planning to build a third new unit at the PNG plant, to be partly fed by another new gas field, P’nyang.

Credit Suisse analyst Saul Kavonic said the political upheaval could put pressure on the government to negotiate tough terms for the P’nyang gas agreement, which is yet to be finalised, and affect talks on development costs.

“Both these factors heighten the risk of delay,” he said in a note to clients.

Any delays in the P’nyang agreement could hold up a final investment decision on the PNG LNG expansion, which is set to double the plant’s capacity to 16 million tonnes a year.

The uncertainty sent shares in Oil Search, a partner in PNG LNG and Papua LNG, down as much as 3.9% in early trading on Monday. Energy stocks rose 0.6%.

ExxonMobil and its partners had hoped to begin basic engineering planning for the expansion by mid-2019 and make a final investment decision in 2020.

They are racing against projects in Mozambique, Qatar, North America and Australia to produce LNG from the expansion by 2024 to fill an expected gap in the global LNG market. ExxonMobil and Total both have LNG projects elsewhere that could take priority if PNG politics delays them, Kavonic said.

RBC analyst Ben Wilson said he did not think a final investment decision in 2020 was at risk yet and played down the threat that the PNG opposition would seek to renegotiate the LNG agreement.

“Sanctity of contract is critical to ongoing investment in PNG and to the success of future potential sovereign bond issuances,” Wilson said.

Total and Oil Search representatives were not immediately available to comment.

Leave a comment

Filed under Corruption, Mine construction, Papua New Guinea

‘Reform PNG’s Resource Ownership Laws’

Henzy Yakham | Post Courier | September 12, 2018

The conversation on ownership of natural resources has intensified in recent times with the issue moved from the simmer-back to hot-and the front-burner.

In the forefront and pressing for revolutionary reforms in the resource ownership regime are two of PNG’s founding statesmen – Sir Julius Chan and Sir Mekere Morauta.

Both Sir Julius and Sir Mekere played very significant roles during pre-independence years as architects to craft the foundations of PNG’s currency, banking and financial institutions, which in succeeding years underwent further reforms to improve their service delivery.

Today, the two former prime ministers are calling for changes to the resource ownership laws so that the original inhabitants of land and sea where the natural resources are found have fair and equitable benefits. In November 2013, despite not attending a Madang meeting of governors from maritime provinces due to prior confirmed official engagements, Sir Julius provided a brief paper to his colleagues on the development of PNG’s extractive industries, ownership of natural resources and related issues. Included in the brief was Sir Julius’ stance that land/resource owners’ rights to own natural resources on and under their land and sea as his proposed remedies in the mining industry.

The brief highlighted a number of aspects in which PNG has failed to structure the mining industry for maximum value to PNG and its citizens. With the brief were comparisons of mineral royalty rates of PNG (which are among the lowest in the world), and other countries which include:

Poland: 10 per cent contained metal value
Ghana: 3 -12 per cent sliding with price
Canada: 15 per cent (British Columbia) taxable income; 18 per cent (Ontario) of taxable income 20 per cent; (Quebec) of taxable income
Mozambique: 10 -12 per cent diamond; 5-8 per cent precious metals
Mexico: 8 per cent gold
Botswana: 10 per cent diamonds; 5 per cent precious metals
United States: 12.5 – 16 per cent Oil; 8 – 20 per cent precious metals
Papua New Guinea: 2 per cent gold; 2 per cent copper

Sir Julius maintains that PNG’s mining regime is grossly distorted and unfair because billions of kina are earned, but the real land, and resources owners simply do not realise their fair share of the benefits.

In a nutshell, he has been pushing for among others:

– Royalties raised to 10 per cent f.o.b. annual revenues;
– SSG raised to 10 per cent f.o.b. annual revenues and SSG payments should be made directly from the company to the province;
– Tax Credit raised to 10 per cent of assessable income and funds should be placed in an account the year of eligibility with no time limit on the use of funds;
– The State receive at least 30 per cent equity in all mining projects free of charge, and should convey a significant portion of this equity to the province, the LLG and the landowners;
– Twenty per cent (20 per cent) of all royalties, special support grants, tax credit and dividends from equity holdings be placed in a separate account to be used for development projects in non-mining provinces; and
– The Mining Act 1992 be comprehensively reviewed and amended, specifically such that ownership of all minerals on and below the sea is vested in the province in whose waters minerals are located.

PNG’s Mining Act 1992, states that all minerals existing on, in, or below the surface of any land in PNG, water lying in any land in PNG, are the property of the State. During colonial rule, the mining and petroleum laws of PNG were adopted based on Australian precedents, giving the powers of ownership of resources in the Administrator. Under the common law of England, minerals belong to the owner of the land under which they are found.

The British Common Law, inherited by Australian colonies upon white settlement, included a presumption that the owner of the land is entitled to all that lies above and below the surface.

Natural resources such as minerals were regarded as part of the land in which they naturally occurred and accordingly passed into private ownership upon Crown grant of the land. Despite these arguments, in the end the Australian Statutory Law in place during colonial times prevailed over both PNG law and British Common Law, this was formalised in the Mining Act 1992. However, it is very clear that State ownership violates both traditional PNG law and British Common Law.

In April 2013, Sir Julius told the Parliamentary Referral Committee on Minerals and Energy inquiry into the review of Mining Act 1992 that under current laws, PNG simply gives away all its wealth and then buys it back at an exorbitant price.

On August 19, 2013, Sir Julius was the Keynote Speaker at the Department of Mineral Policy and Geohazards Management (DMPGM) organised regional consultation meetings in Kokopo, East New Britain Province on the proposed changes to Mining Act 1992. There, he outlined the way in which the mining regime in PNG has failed the people and the way it should be changed for the greater benefit of the people and provinces.

On May 14, 2009, Sir Julius proposed reforms in natural resource ownership laws in a motion tabled in Parliament.
The underlying intention of the motion was for the transfer of the resource ownership to landowners of where the resources are found. As well, the motion proposes for increased benefits for landowners, provincial governments and the country in general.

Sir Julius argues that as a direct consequence of the arrogation of all mineral, oil and gas reserves on land and below the land and sea by the State have been a massive give-away of the national wealth of PNG.

On September 4, 2018, Sir Mekere asked Prime Minister Peter O’Neill a series of questions based on important national issues raised by Sir Julius in his reply to the inaugural address of the Governor General in opening this Parliament.

Sir Mekere prefaced his question to Mr O’Neill by quoting Sir Julius “to remember that in our democracy the final power is the power of the people. We are here for one reason only – to serve the people”.

“I want to take a wider view of the challenges we face. For though we have some short-term problems to tackle, I fear there are even more grave problems looming over us.

“I have never known a time when our country was in greater peril.”

After quoting Sir Julius, Sir Mekere asked Mr O’Neill what the government position on Sir Julius’ recommendations among others to:

– Increase the level of royalties from the current 2 per cent to 10 per cent;
– Increase the level of Special Support Grant and the Tax Credit Scheme;
– Establish a Trust Fund in which 20 per cent of revenues of mining provinces would be paid to distribute to non-mining provinces;
– Revise the Mining Act 1992 and the Oil and Gas Act 1998 to vest ownership of resources in the people;
– Introduce a Derivation Grant for mining and petroleum provinces of 5 per cent of the value of resources originating in that province;
– Increase Autonomy of Provinces, provinces “that demonstrate capacity to manage their own affairs. The autonomy was to cover administrative and financial autonomy and autonomy over non-renewable and renewable resources.

Answering Sir Mekere’s questions, Mr O’Neill said “the Mining Act is under review at present and I will not pre-empt the discussions and the outcomes of that review that is taking place.

“The Mining Minister and his team are already well advanced in those discussions. There will be an opportunity for this Parliament to look through that review and the new Mining Act, which will address all these issues, including royalties, the powers of the provinces with respect to the mining activities in those provinces and the management of the trust funds.

“There has been a gross abuse in the management of some of the trust funds and we are all aware and are trying to correct that as we move forward.

“I can assure you, that the people of Papua New Guinea, particularly the landowners will get a better share of the benefits of the resource development in this country.

“That is the priority of this government and we will continue to pursue it through the mining review which is now being conducted and is still continuing.”

1 Comment

Filed under Financial returns, Human rights, Papua New Guinea

K5M Projects For Nimamar As Sir Julius Fires Broadside At Lihir Gold Mine

Chan: “We will light up the islands and shame the mining giant with the glow of our solar street lights” 

Post Courier | April 26, 2018

Traditional dance groups added colour to the launching of nearly K.5 million worth of projects for five wards in the Nimamar LLG on Malie Island in the Lihir group last Saturday.

The projects include 60 solar street lights to light up village communities in the four island wards from Malie, Masahet and Mahur.

But three boats and one sawmill marked the biggest village impact projects rollout that came under two project initiatives of the New Ireland Government – the Ward Level Project Policy and the Lighting Up New Ireland Policy’

Governor Sir Julius Chan, deputy governor and president of the Nimamar LLG, Ambrose Silul, PEC and provincial assembly members, shipping operator Michael Chan from Vanmak Shipping and staff from the governor’s office and Nimamar LLG gathered with the people to witness the occasion.

Sir Julius had the chance to meet with his people in the electorate. He was at Lambom to launch seven sawmill projects for the Konoagil wards last Thursday with the president James Pandi and then joined president Silul on Saturday to wind up the week.

He told the Lihir people that the Lihir gold mine is the third largest in the world and yet after 20 years in operation Lihir still was without a sealed ring road up until only three years ago, and no power to the inhabitants, even to the islands.

“We recognise that a lot of money for the province comes from Lihir so today I am happy to join with Ambrose so we can put something back to the place of origin. So we will light up the islands and shame the mining giant with the glow of our solar street lights and show that even though the the mine is not forthcoming, this government cares and does what we can to better the lives of our people”

Sir Julius said he’s optimistic of a better deal for the people in the negotiations under the MOA revision that will increase the mining royalty from the current 2% to 10%.

“We fight to put wealth in the hands of the people. Development won’t come if people have no money. If the people are rich the country is rich.”

He encouraged the people to rally behind their president who has been part of the major policies that have impact the province and elect good leader in the coming LLG elections.

3 Comments

Filed under Financial returns, Papua New Guinea

Chan reaffirms stance against Solwara 1 project

Jemimah Sukbat | Loop PNG | December 24, 2017

The views of Governor Sir Julius Chan and the New Ireland Provincial Government have not changed, they have always been against the experimental seabed mining.

This was reaffirmed by NIPG after Loop PNG published an article questioning the governor’s stance.

In response, Loop PNG was told that the provincial government has been demanding that an independent environmental impact study be conducted and the findings be made known to NIPG.

“It will be worthwhile to note that the decision for Nautilus minerals to mine undersea had been made by the national government and as it is under the Mining Act, everything in the earth, in and above the sea belongs to the State,” clarified the government.

“Sir J recognises this and is working on amendments to the act, so mama and papa graun can be fully recognised as owners of these minerals.

“The amendments have gone before Parliament as a private member’s bill.”

NIPG further said as Nautilus is doing business in New Ireland waters using the road and land as access to its ships, etc, they have demanded that Nautilus give back to the community in projects, which it is doing on the west coast.

“Nautilus had so far shown good corporate responsibility but this is not enough to convince NIPG that seabed mining is safe.”

Meanwhile, non-governmental organisations have been advised to visit Sir Julius’ Kavieng office and dialogue with their government.

Leave a comment

Filed under Environmental impact, Human rights, Papua New Guinea

What is Sir Julius’ stance on experimental seabed mining?

Jemimah Sukbat | Loop PNG | December 21, 2017

People in West Coast New Ireland are confused about Sir Julius Chan’s position on seabed mining.

This was revealed by a Messi villager of New Ireland and Solwara Alliance campaigner against seabed mining in the Bismarck Sea.

Jonathan Mesulam, in a recent interview, says he understands that in June 2016, the Governor made it clear that he and the New Ireland Provincial Government were against seabed mining.

However, it now seems as if he is for the project.

Mesulam further reveals that despite their call on the Government to ban the project, they have experienced great opposition against the project locally, nationally and internationally.

With the project to be underway in 2019, the Governor is yet to come out clear with a firm decision on where he stands, on behalf on his people.

Moreover, multiple attempts from this newsroom to reach Sir Julius Chan have been unsuccessful.

Meanwhile, the Solwara Alliance filed a case at the National Court on the 7th of this month against the Government on seabed mining.

1 Comment

Filed under Environmental impact, Human rights, Papua New Guinea