By Johnny Blades | Dateline Pacific | Radio New Zealand
Papua New Guinea’s new prime minister has stressed that his government is pro-foreign investment.
James Marape’s announcement that he wants to review the laws governing the country’s resources has caused some concern among investors in the sector.
But the move is popular at the grassroots level in PNG.
In his first state of the nation address, James Marape said PNG had not been enjoying the full benefits of the commercialisation of its abundant natural resources.
His government will review the laws governing the oil, gas, mining, fisheries and forestry sectors, which he has described as outdated.
Mr Marape showed his hand by appointing Kerenga Kua, a critic of the previous government’s handling of resource projects, as PNG’s Minister of Petroleum.
The prime minister said they will be looking at the resource sector “in a very big way”.
In April, James Marape and other MPs resigned from the Peter O’Neill-led government after it signed with French company Total for the $US13-billion Papua LNG project in Gulf province.
They cited concerns that local interests were not being served and claimed mandatory requirements were not fulfilled before the agreement was signed
Their stand has resonated with Gulf landowners who baulk at the two percent equity on offer for them.
The Purari Development Association general secretary Roy Daniel Evara says the developer has dictated terms to PNG.
“The agreement itself did not comply to very critical pre-conditions of the Oil and Gas Act, which is the guiding pillar for the industry. An agreement should never dictate to the pillars of the country’s laws. It should only conform and comply with it.”
Mr Marape’s moves are being watched closely by companies deeply involved in PNG’s resource sector such as energy firm Oil Search Ltd, a partner in the Papua project.
While Mr Kua and others have suggested the Project agreement could be reviewed, Oil search’s chief executive Peter Botten said he didn’t expect to make any significant new concessions on the deal.
Mr Botten told a mining convention in Sydney that delays to the deal could jeopardise PNG’s standing in the international LNG market.
Subsequently, Mr Marape bristled at suggestions that he was trying to chase away investors.
He said he made no apologies for his aim of ensuring PNG citizens get greater benefits from the petroleum sector.
Mr Marape knows the struggles of landowners in resource-rich areas well.
His own elecorate of Tari-Pori is in Hela province, where the country’s first LNG gas Project operated by Exxonmobil and Oil Search is centred.
A magnitude 7.5 earthquake hit the region last year causing around 150 deaths and widespread devastation to infrastructure.
Although it has it share of critics, Oil Search was heavily involved in the immediate relief effort.
The man who headed PNG’s response to the disaster, Bill Hamblin, says Oil Search showed itself to be a good corporate citizen in PNG.
Meanwhile, PNG’s Chamber of Mines and Petroleum says it’s waiting on clarity from the new government on its policies and plans in relation to the resource industry.
But it says that stability on fiscal and regulatory regimes is important to ensure ongoing investment in the sector.
Go to this link for more: https://ramumine.wordpress.com/2019/06/13/new-png-govts-resources-stand-in-the-spotlight/
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