National Alliance Party leader Patrick Pruaitch says the Parliament’s Public Accounts Committee will face a daunting task when it looks into the financial a airs of Kumul Petroleum, which holds the government’s 16.57 per cent stake in the PNG LNG Project. Mr Pruaitch said the Marape government has taken a responsible stance by rejecting claims by Kumul Petroleum that it is not answerable to the PAC inquiry chaired by Sir John Pundari.
“I have raised several issues with regard to the financial affairs of Kumul Petroleum, which is the only state-owned enterprise that operates as though it is not accountable to anyone even though every toea that it has rightfully belongs to the people of PNG,” he said.
“The financial accounts released by Kumul Petroleum, covering the period from 2014 to 2017, indicates that it has been in receipt of over K5 billion as a result of government equity in the PNG LNG Project. Only a tiny portion has been returned to the government as dividends and corporate tax.
“It has now come to my attention that the 2017 annual accounts of Kumul Petroleum, which have been endorsed by the Auditor-General, discloses that total revenue it received from PNG LNG in 2017 was US$411 million, or approximately K1.37 billion.
“However, the 2017 annual report from the Government’s Extractive Industries Transparency Initiative (EITI) shows that it received K2.097 billion from PNG LNG, suggest- ing under-reporting of 2017 revenue by over K700 million.
“Has there been an accounting problem or has this money simply vanished? An additional discrepancy is that the Kumul Petroleum 2017 accounts show the company paid US$56.74 million in corporate tax in 2017, while EITI only records a payment of K13.3 million, as confirmed by the Internal Revenue Commission.”
Mr Pruaitch said it was notable that key agencies that have not cooperated with the government mandated EITI process have been Kumul Petroleum and the Bank of Papua New Guinea, which has been recipient of landowners’ royalty payments from the PNG LNG Project.
Mr Pruaitch, who recently left his position as opposition leader to join government, said it was praiseworthy that Prime Minister Marape has shown a determination to ensure that government bodies, such as Kumul Petroleum and Mineral Resources Development Company, were transparent and accountable. Former prime minister Sir Mekere Morauta has raised a series of issues regarding the operations of MRDC and Prime Minister Marape has agreed to hold a public inquiry into MRDC.
The National Executive Council has also instructed Kumul Petroleum to appear before the PAC inquiry.