Tag Archives: PNG development

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!”

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PNG Petroleum Minister Kua brushes aside claims of Threats on Gas Project

NBC News | 23 January 2020

Papua New Guinea Petroleum Minister Kerenga Kua has brushed aside claims of threats to close gas projects in Western Province.

This follows, Governor, Taboi Awi Yoto and North Fly MP, James Donald claims, the State Negotiating Team has poorly negotiated for the province and the landowners over the P’nyang Gas Project’ with the developer in Singapore last week.

The leaders have threatened the government to close P’nyang and Stanley LNG Projects before the close of business this Friday until the Oil and Gas Act is amended.

In his response, Minister Kua says constitutional law allows all minerals and petroleum is owned by the State and not by provinces and landowners.

He said only the State is empowered to commercialise these resources, and no other entity is by law empowered to do this.

Mr. Kua said leaders at all levels are entitled to express their views on issues related to resource project negotiations but State will make the final decision.

The Petroleum Minister urges leaders to remain calm as P’nyang Ministerial Committee is always on hand to discuss any discontentment.

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Pressure rises in PNG gas standoff

The P’nyang gas agreement is becoming a test case for the Marape government’s promise to stand up to resource extraction firms

Craig Guthrie | Petroleum Economist | 22 January 2019

Papua New Guinea (PNG) failed again in mid-January to agree fiscal terms with ExxonMobil for the development of its onshore P’nyang gas field, raising the stakes for all parties involved in a wider project to double gas exports.

The failure of the state team negotiating in Singapore piles political pressure on the PNG government; Prime Minister James Marape rose to power last May on the back of pledges to reap more revenue from international resources firms and lift the vast South Pacific archipelago out of poverty.

It also increases the financial strain on private stakeholders. The P’nyang gas agreement needs to be sealed before a complex pre-Feed process can start for a larger associated liquefaction project, the $13bn Papua LNG, led by Total but also involving ExxonMobil and others, which is targeting FID this year and production in 2024.

PNG-based oil and gas exploration and development company Oil Search, a partner in the P’nyang (36.86pc) and Papua LNG (17.7pc) projects, stated last October that the delays meant it reduced capex on the project by 15pc last year, while noting engineering work and marketing cannot get underway until the talks progress.

ExxonMobil refused a deal offered by oil minister Kerenga Kua at the first round of talks last November. Kua said this was “disappointing”, claiming the terms, which remain confidential, were in line with similar extraction arrangements in place in Indonesia and Malaysia. Fresh from disappointing renegotiations with Total, PNG wants benefits that are “far greater than Papua LNG” and is seeking “a good deal, not a fast deal”, the negotiating team stated.

“In the P’nyang talks, the government appears to be seeking a better tax take, more local content and jobs opportunities, more project information from the operator, and a firm commitment to development of P’nyang in a defined timeframe,” says Credit Suisse analyst Saul Kavonic.

P’nyang, which is estimated to hold 4.4tn ft³ of gas in the West Highlands province, would support an additional train at the Papua LNG project (Total will supply the other two from separate fields). Each of the three trains will have capacity to produce 2.7mn t/yr. Once operational these would double PNG’s 2020 LNG exports, which are all produced at ExxonMobil’s PNG LNG facility at Caution Bay. Papua LNG is planned to share certain brownfield facilities as well as feedgas and export facilities with PNG LNG.

Weakened hand

A Fitch Solutions report last September warned that PNG’s fiscal position had worsened year-to-date. “The country has struggled to establish sustainable revenue streams to meet spending requirements, leading to persistent budget deficits, an unsustainable build-up of public debt and greater exposure to adverse economic or financial shocks,” noted Fitch.

PNG expert Colin Filer, of the Australian National University’s College of Asia and the Pacific, says ExxonMobil is “playing hard ball” because the projects are such a small part of its global portfolio. “It believes it can hold the PNG government’s feet to the fire, because of its fiscal woes”.

Australian bank ANZ stated in December that the lack of a P’nyang breakthrough will delay the forecast national economic recovery by 12 months. “A longer project dialogue will push the recovery out further, with a risk that extended negotiations could derail the economic upturn.”

The government also faces the ongoing threat of local resistance from West Highlands landowners. Regional leaders stated on 21 January that they had withdrawn their support for the agreement as it has “not incorporated their interests”.

Papua LNG also faces a wave of global competitors targeting an anticipated spike in demand for LNG in the mid-2020s that may or may not materialise. “A P’nyang gas agreement remains a precursor to the entire PNG LNG expansion project, which is competing for a rapidly narrowing market opening later this decade,” says Kavonic.

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Official: Minerals not yielding for PNG


The National aka The Loggers Times | January 13, 2020

A SENIOR official says Papua New Guinea has missed out on a lot of the potential benefits that should have flowed to the State from mineral revenue.

Secretary for Department of Mineral Policy and Geoharazd Management Harry Kore said this was unfair.

“Assessments and comparative analysis of other countries of similar standing as PNG has demonstrated that PNG has missed out on a lot of the potential benefits that should have flowed to the State,” he said.

“Our people need to understand these facts.

“The numbers don’t lie.”

Making reference to Extractive Industry Transparency Initiative (EITI) 2017 Report, Kore said information on the EITI report was “very valid”.

“The diagram of the percentage of the benefit, a mere seven per cent is a major paradigm shift in PNG’s perception of the benefits we’ve been deriving from the extractive sector over the years,” he said.

“This just does not equate to a fair share.

“We have always thought the extractive sector was the major contributor to the economy, which is very true with the volume of export (86 per cent); but when you look at the EITI Report, only a mere seven per cent out of the total is Government revenue.

“The figures per se of the actual kina value may seem quite significant but it is the percentage contribution against these other measures that is our focus to ascertain whether we are getting value for the minerals exported.”

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Mining Sector not giving enough Money to PNG : Expert

The National aka The Loggers Times | 23 December 2019

PAPUA New Guinea is not getting enough in terms of revenue generation from the resource projects it has, an expert says.

Organisation for Economic Co-operation and Development (OECD) tax adviser Vy Tran made the statement during the launch of the mining audit programmes and mine closure and rehabilitation plan in Port Moresby on Friday.

“PNG has a long history of mining,” he said.

“Our friends from MRA told me that mining started in the 1930s.

“So that’s almost 90 years of mining in PNG.

“During that time, the questions has been whether the citizens have seen the benefits from the mining sector.

“Jobs come from mining. But the other question was that whether the taxation revenue has flowed from that.

“Taxation revenue is very important in terms of redistributing that wealth to other citizens.”

Tran further noted that in 2007, OECD conducted a study that looked at taxation revenues as a measure against GDP.

“PNG’s ratio in that respect was 13 per cent,” he said.

“The question is that is that a strong percentage?

“When compared to your peers in the Pacific, it ranked the lowest.

“It was ranked lowest in terms of revenue collection to GDP.

“At the same time, in comparison to developed countries that are resource rich like Australia, Australia was more than doubled that ratio.”

Tran said in comparison to the average in Africa, PNG ranked five per cent lower than African countries.

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Alluvial mining sector has huge potential


LOOP PNG | 24 December 2019

Over a billion kina can be generated from the Alluvial Mining Industry if small scale miners are upskilled.

The Small Scale Mining Training Centre in Wau, Morobe Province, is one such facility upskilling small scale miners in the sector.

And so far the results have been positive with more than 5000 small scale miners graduating through the program.

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Marape-Steven Govt Plans to Process Gold in PNG

NBC News / PNG Today | December 9, 2019

The Papua New Guinea  government says it plans to establish a Gold Bullion Bank in the country to allow downstream processing of gold.

The establishment of such a bank is an agenda of the government, and policy directives were recently issued for its development.

According to Mining Minister, Johnson Tuke, after its construction, the Gold Bullion Bank, will store and build up a stockpile of gold bullions for the future generation.

Minister Tuke told the recent Mining and Petroleum Conference that the revised Mining Act 2019, will allow for a portion of the government’s share to be processed either locally or overseas.

Mr. Tuke said this government portion will then be retained in the proposed Gold Bullion Bank after processing.

He said it is a standard provision in all mining development contracts that one-third of all Gold products are to be processed and stored locally, provided that there is a refinery of international standards.

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