"We declare our first goal to be for every person to be dynamically involved in the process of freeing himself or herself from every form of domination or oppression so that each man or woman will have the opportunity to develop as a whole person in relationship with others".

- Papua New Guinea National Goals and Directive Principles

Sunday, 31 October 2010

Exxon Mobil's Profits Soar 55 Percent

LNG Watch: Interesting data from this article -  last year Exxon Mobil's profit was US40.6 billion. PNG's annual budget is about US3 billion.

ExxonMobil profit soars 55 percent in third quarter

ExxonMobil said Thursday its profit soared 55 percent in the third quarter, driven in part by higher energy prices and rising oil production in Qatar. The US energy giant reported net earnings of 7.35 billion dollars, a better- than-expected advance from the 4.73 billion dollars posted in the 2009 third quarter.

Earnings per share of 1.44 dollars in the July-September period topped the consensus forecast of 1.39 dollars. Revenue surged 16 percent to 95.29 billion dollars.

ExxonMobil, the world's largest non-state oil company, said the strong performance was due to higher crude oil and natural gas prices, improved refining margins, and solid chemical results.

"Despite continuing economic uncertainty, we had strong quarterly results and continued to advance our robust investment opportunities," ExxonMobil chairman Rex Tillerson said in a statement.

The Irving, Texas-based company said it had returned more than five billion dollars to shareholders in the third quarter, through dividends and share purchases.

The company announced Tuesday it would pay a fourth-quarter dividend of 44 cents, the same amount paid in the third quarter.

Oil and gas production rose 20 percent from the third quarter of 2009, driven in part by increased production from projects in Qatar.

Capital and exploration spending increased 35 percent, to 8.8 billion dollars. ExxonMobil reported nine-month earnings, excluding special items, were 21.21 billion dollars, a 59 percent increase from the same period in 2009.

In 2009 it posted the largest profit of any publicly listed company worldwide: 40.6 billion dollars.

Global Insight's Warning on Somare

Global Insight (29/10/2010), a global leader in economic and financial analysis,claims that the NEC's decision to increase security for the LNG project illustrates that the Somare government is willing to adopt authoritarian tactics to get things moving at the pace desired by the investors:

"Today's announcement highlights the extent of this problem. It is also highlights the importance Somare's government attaches to investor sentiment and its willingness to crack down on landowners and locals who threaten to disrupt projects either through protests or legal action. The fact that a special meeting of the NEC was held is evidence of this position ... The deployment may improve the security situation at the projects, but further disruptions remain likely in the medium term".

Friday, 29 October 2010

When Persuasion Fails Exxon Mobil Reverts to Force

According to Miles Shaw, Exxon Mobil's Public Relations Manager:
Yet now it would appear that at the very time Mr Shaw was making this claim, Exxon Mobil was placing pressure on the NEC to step up security around the LNG construction sites. This pressure is a result of the growing opposition to the LNG project as awareness grows of Exxon Mobil's environmental, labor and human rights practices.
On the 14th of October LNG Watch PNG raised serious concerns over Exxon Mobil's preparedness to use military/paramilitary forces to 'obtain' the community's consent when persuasion fails. It would now appear that as dissent heightens in the project areas, Exxon Mobil are returning to bad old habits, habits that have left them in hot water in Aceh. 
They have been fully informed of the RPNGC's mobile squads woeful record, and there is a now a responsibility on the company, given the pressure they are placing on the NEC, to ensure that the government's security forces conduct themselves properly.
If this new contingent abuse the human rights of villagers, Exxon Mobil may find that it is not only Achenese plaintiffs pursuing them in the US courts.
More Police to be deployed to LNG sites in PNG

A 30-strong police squad will be redeployed at three LNG project construction sites today to ensure work continues on schedule.

The National Executive Council (NEC) met in an emergency session yesterday and approved the immediate release of K10 million for security operations.

Police Commissioner Gari Baki said last night that police from Port Moresby would be sent at first light to Gobe in Southern Highlands and Gulf’s Kikori and Kopi where construction of facilities were underway for the laying of the pipeline from the gas fields to the coast to Port Moresby.

The police redeployment was to quash fears among investors, especially developer ExxonMobil and its construction contractor Clough Curtain Brothers Joint Venture (CCBJV), of growing landowner opposition over employment opportunities, working conditions and outstanding land pay issues.

Infrastructure activities at Gobe, Kikori and Kopi included camp construction and site clearing, wharf and laydown at Kopi and bridge and road works on northern and southern logistics routes.

Mr Baki said he gave a briefing on the security situation to the NEC which was chaired by Prime Minister Sir Michael Somare, and attended by Internal Affairs Minister Sani Rambi,Finance Minister Peter O’Neill, Arthur Somare (Public Enterprises) and Paul Tiensten (National Planning).

The meeting was called about 4pm amid growing concerns that investors were seriously considering their options in the multi-billion-kina project, which was scheduled to begin production in three years.

The construction phase had been targeted by the burning of equipment belonging to CCBJV at Kopi, strike at Komo airfield construction site and last Friday’s stop-work by 108 employers at two pipeline sites.

Mr Baki said police personnel from the Port Moresby-based task force division would be deployed for an indefinite period.

Police had withdrawn from selected sites during the year because of lack of funds.

Mr Rambi confirmed Mr Baki’s statement, adding that the K10 million would be drawn from the K101 million set aside last month for special police operations, including resource areas.

He said police presence was to restore law and order and, secondly, to instill public confidence in the project, especially among the expatriate workers.

The NEC intervention yesterday was forced by events of the past week when villagers stopped early
construction work on pipeline from Kopi to Kaiam and Mubi crossing.

The villagers, many of whom were employed by CCBJV, had petitioned the prime minister to address their grievances such as poor salary and bonuses, among others.

So far, ExxonMobil had not commented on the strike. 


Environment Act Amendment has Destabilised PNG's Investment Environment

According to D&B's (a major US ratings agency)  Country Riskline Report (November 2010) the Environment Act amendment has distabilised PNG's investment environment: 

"In May, the PNG government amended part of the country's Environment and Conservation Act 2000 to give the director of the Office of Environment and Conservation the authority to approve any investments with a potential environmental impact, such that its decisions "may not be challenged or reviewed in any court or tribunal, except at the instigation of an Authorisation Instrument". Aimed at streamlining the investment approvals process, this has proved unpopular with PNG's traditional landowners, whose long-held rights to sue for compensation for environmental damage have effectively been removed. Indeed, no sooner had work on begun on the initial construction of the country's largest planned Liquefied Natural Gas (LNG) pipeline than protests by local groups forced a walk-out by workers.
Clearly, the government's legal authority to grant approval for resource extraction projects without the consensus of local residents will be continually challenged on the ground. Complicating the situation, several affected landowners have stated that they support the LNG project, and that demonstrators are actually from other areas. Moreover, a former senior Cabinet member who recently defected to the opposition, Belden Namah, has publicly stated his belief that the LNG project will not be realised due to the government's failure to address landowner complaints correctly. Although D&B believes that the present protests are more of an attempt to win a pay-off from the government and/or the LNG pipeline developers than an outright effort to block the project, recent events still underline the high degree of political risk that will continue to hamper the progress of inward investment in PNG".

Tuesday, 26 October 2010

LNG and the Resource Curse

When ExxonMobil Begins Drilling for Gas in Papua New Guinea, Will the Country Fall Victim to the Dreaded Resource Curse?

Reports have emerged that ExxonMobil (XOM) will begin drilling for natural gas in Papua New Guinea.

The company’s operations are expected to bring $30 billion -- more than double its current GDP -- over 30 years, but many are wondering if Papua New Guinea, named one of the world’s most corrupt countries by Transparency International, will be able to avoid the so-called “Resource Curse.”

The Resource Curse is the paradox that occurs when a country finds itself sitting atop vast riches in the form of minerals, precious metals, and so forth, but finds itself pushed deeper into poverty and societal disrepair.

According to the Christian Science Monitor, Juan Pablo PĂ©rez Alfonso, one time Venezuelan oil minister, likened oil to “the devil’s excrement”. Sheikh Ahmed Yamani, his Saudi Arabian counterpart, reportedly once said, “I wish we had found water.”

Case in point: According to The New York Times, the chief of Kili, a local Papua New Guinea town, received $120,000 for land the authorities will use to shore up infrastructure surrounding ExxonMobil’s arrival.

However, in a sort of microeconomic example of the Resource Curse, he revealed that he had given most of the money away to his 10 wives, used some of it to buy 48 pigs, which he used as a dowry to woo another bride, and spent the rest on 15 cases of beer.

“All the money is now gone,” he said. “But I’m very happy about the company, ExxonMobil. Before, I had nothing. But because of the money, I was able to buy pigs and get married again.”

John Ghazvinian, the author of Untapped: The Scramble for Africa's Oil, and a visting fellow at the University of Pennsylvania, points to Africa as a prime example of the tribulations of the Resource Curse.

“Since 1990 alone, the petroleum industry has invested more than $20 billion in exploration and production activity in Africa,” he wrote. “A further $50 billion will be spent between now and the end of the decade, the largest investment in the continent's history.”

But, he noted, “Between 1970 and 1993, countries without oil saw their economies grow four times faster than those of countries with oil.”

Ghazvinian explained that “oil exports inflate the value of a country's currency, making its other exports uncompetitive. At the same time, workers flock to booming petroleum businesses, which saps other sectors of the economy.”

“Your country becomes import-dependent,” he said. “That decimates a country's agriculture and traditional industries.”

A 2000 paper [PDF] written by Thorvaldur Gylfason for the Centre for Economic Policy Research shows that, among OPEC countries, from 1965 to 1998, “gross national product per capita growth decreased on average by 1.3%, while in the rest of the developing world, per capita growth was on average 2.2%.”

Why does this happen? And what can be done in the future to head off the Resource Curse?

In an interview with Minyanville, James Paul, executive director of the Global Policy Forum, shed some light on the issue:

“There have been a number of initiatives that have been proposed by NGOs in recent years to deal with natural resource-related issues. There’s a whole host of ideas out there. It really boils down to corruption, in most cases.”

Paul says:

“Realize that these are some of the world’s largest companies -- ExxonMobil, Chevron (CVX), BHP Billiton (BHP). And they’re almost always larger in terms of revenues than the countries that they are operating in; that has an enormous capacity to corrupt people. Mines, for example, are hugely valuable. So if a company gives a government official $1 million, that’s nothing to the company, but for the official, it’s enough to retire on, in great comfort.”

Paul also points out “natural resources are getting scarcer and scarcer. To get them, you have to do more and more outrageous things. Increasing scarcity leads to more and more irresponsible acts. There’s a desperation to get this stuff which feeds the maw of the whole industrial and economic system that relies on it. You can increase extraction up to a certain point, but most of what’s easy to get has already been taken.”

What’s more, the Resource Curse exists not only in far-flung lands, but right here in the United States.

Take Massey Energy (MEE), and the Resource Curse created in West Virginia by the coal giant’s corrupt ways and the people it affected -- not least, the miners who died in a methane explosion while working in Massey’s Upper Big Branch mine last April.

In the aftermath of the tragedy, many focused on the company’s less-than-stellar safety record -- 124 citations and orders up to that point in 2010 alone, and 3,011 through 2009.

Attorney Brett Emison, of Lexington, Missouri’s Langdon & Emison called Massey’s recent history “a story great novels are made of,” and, in fact, it truly is. Massey CEO Don Blankenship’s successful attempt to “buy” a West Virginia Supreme Court judge was the basis for John Grisham's 2008 legal thriller, The Appeal.

In 2002, a West Virginia jury awarded the now-defunct Harman Coal $50 million after finding Massey liable for “fraudulent misrepresentation, concealment, and tortious interference” related to a canceled coal-delivery contract that put Harman out of business.

Massey appealed the ruling.

Two years later, the case was headed to the West Virginia Supreme Court of Appeals. While waiting for the case to be heard, West Virginia’s judicial elections were underway, and a lawyer named Brent Benjamin was running against incumbent justice Warren McGraw, whom Blankenship considered anti-business and believed would uphold the lower court’s ruling against Massey.

Blankenship formed a group called “And for the Sake of the Kids,” which raised $3 million for Benjamin’s campaign -- more money than any other group, including Benjamin’s own campaign committee -- and proceeded to paint McGraw as a radical, liberal liar who was soft on crime.

Surprise! McGraw was defeated and the new Justice Benjamin -- now West Virginia’s chief justice -- twice cast the deciding vote to throw out the judgment that had awarded $50 million to Harman Coal, after refusing to recuse himself from the case, as requested by Harman’s President Hugh Caperton. (In a related note, Justice Elliott "Spike" Maynard, who was also on the panel hearing the case, recused himself after photographs of him and Blankenship vacationing together in the French Riviera were made public.)

“Massey operates with impunity,” Emison (who was not involved with the case) told Minyanville. “They go ahead and ignore regulations because when they’re called into the courtroom and lose a case, they know they can buy their way out of it.”

Certainly, other mining companies like Peabody Energy (BTU), Arch Coal (ACI), Consol Energy (CNX), and Alpha Natural Resources (ANR) see their fair share of problems -- extracting coal from the earth is a tough business. But Massey seems to exist in a league of its own.

On June 8, 2009, in a 5-4 ruling, the United States Supreme Court found that Justice Benjamin’s failure to recuse himself from the Harman case violated the Fourteenth Amendment of the Constitution, depriving Harman Coal’s right to due process.

“The really surprising thing here is that it was a 5-4 decision,” Emison said. “That means four Supreme Court justices said there’s nothing wrong with buying a judge. Chief Justice Roberts basically said it really wasn’t a big deal.”

In an editorial, the New York Times agreed, writing that the idea that there were four dissenting opinions at all was “alarming” and noted that “Chief Justice Roberts is fond of likening a judge’s role to that of a baseball umpire. It is hard to imagine that professional baseball or its fans would trust the fairness of an umpire who accepted $3 million from one of the teams.”

Will Papua New Guinea fall victim to the Resource Curse or will it take after a country like Bostwana, which was able to avoid it, due in large part to relatively good governance and sound institutions?

The town administrator of Komo, Papua New Guinea, told a reporter that the area “was a lawless place until last year.” But, he says, “The government is coming back now. When ExxonMobil came here, it was the light at the end of the tunnel.”

In this case, perhaps the best we should hope for is that Papua New Guinea doesn’t follow West Virginia’s lead

Riches May Not Help Papua New Guinea - A must read piece on the LNG project

One of the best journalistic overviews LNG Watch has come across on the challenges the LNG presents to PNG - how telling it is that Exxon Mobil refused to be interviewed:

Riches May Not Help Papua New Guinea

by NORIMITSU ONISHI (New York Times, 25/10/10)

TARI, Papua New Guinea — A founding myth in the Southern Highlands of Papua New Guinea is said to have foretold the arrival of ExxonMobil, the American oil giant that is preparing to extract natural gas here and ship it overseas.

According to the myth, called Gigira Laitebo, an underground fire is kept alive by inhabitants poking sticks into the earth. Eventually, the fire “will light up the world,” said Peter O’Neill, the national government’s finance minister. “By development of the project and delivering to international markets, it’s one way of fulfilling the myth.”

But like all myths, this one is open to wide interpretation, as a group of men and women at a Roman Catholic parish here suggested before Sunday Mass recently.

“If foreigners come to our land, you give them food and water, but don’t give them the fire,” said John Hamule, 38, as the others nodded. “If you do, it will destroy this place.”

In 2014, ExxonMobil is scheduled to start shipping natural gas through a 450-mile pipeline, then on to Japan, China and other markets in East Asia. But the flood of revenue, which is expected to bring Papua New Guinea $30 billion over three decades and to more than double its gross domestic product, will force a country already beset by state corruption and bedeviled by a complex land tenure system to grapple with the kind of windfall that has paradoxically entrenched other poor, resource-rich nations in deeper poverty.

While the West’s richest companies are used to seeking natural resources in the world’s poorest corners, few places on earth seem as ill prepared as the Southern Highlands to rub shoulders with ExxonMobil. The most impoverished region in one of the world’s poorest countries, it went unexplored by Westerners until the 1930s. Believing that this rugged, mountainous region was uninhabited, the explorers were stunned to find at least one million people living here in one of the world’s most diverse areas, largely in small, distinct communities separated by different cultures, languages and nearly impassable terrain.

Constant tribal wars over land, women and pigs — the last being prized measures of wealth, used to pay for dowries and settle disputes — have grown deadlier in the past decade with the easy availability of high-powered rifles smuggled in from Indonesia, just to the west, which are exchanged for the marijuana grown here.

Mr. O’Neill says the Southern Highlands are too diverse, too fragmented, to develop the kind of widespread insurrection that exists in the Niger Delta of Nigeria.

But local leaders worry about the continuing inflow of guns into an area with almost no government presence, and no paved roads, electricity, running water, banks or post offices. They worry that the benefits of the gas project will fall short of expectations, begetting a generation of young men who will train their anger on ExxonMobil.

Already, in fact, angry landowners have forced ExxonMobil’s contractors to suspend work temporarily at several construction sites, and local businessmen bid for contracts with unconcealed threats.

“Any outside waste management company that is given the contract will not be allowed into Komo by force or whatever means,” said Robin Tuna, 34, whose company was bidding for just such a contract in Komo, an area south of here where ExxonMobil is building a large airfield.

And ExxonMobil faces the daunting prospect of dealing with Papua New Guinea’s distinctive form of land tenure, which grants control over 97 percent of the land to customary landowners, primarily indigenous people whose ownership rights to small plots are inherited. More than 60,000 people own land where gas will be either extracted or transported.

To get their agreement, the government invited 3,000 to a meeting last year to hammer out benefit-sharing agreements. The government intentionally held the conference on an island to ward off gate-crashers, though 2,000 uninvited landowners eventually flew over, said Anderson Agiru, the governor of Southern Highlands Province. The meeting, scheduled for seven days, lasted six weeks.

And still thousands, who remain unsatisfied, have streamed to the nation’s capital, Port Moresby, to try to get their cut.

“They tell us they are busy or to come back the next day,” said Jim Tatape, one of hundreds of angry landowners milling around recently in front of the Department of Commerce and Industry, waiting to see anybody inside.

“We don’t want to deal with government anymore,” added Mr. Tatape, who was seeking money to start a small, though vaguely defined, business. “ExxonMobil is the developer. We are the landowners. We should deal together.”

Officials at ExxonMobil declined to be interviewed for this article. In an e-mail, the company said it “seeks to create long-term economic and social benefits from its projects and presence.” Citing its ethics policy, the company wrote that it strived to “help developing nations to improve their systems as well as help support local business to develop proper governance systems.”

The picture here in the Southern Highlands is not completely bleak. With the start of several ExxonMobil-related construction projects in recent months, for instance, the police have returned after a long absence.

“It was a lawless place until last year,” said Joe Wija, 43, the town administrator at Komo, where police barracks and a new provincial government building are being constructed after the end of a long tribal war.

“The government is coming back now. When ExxonMobil came here, it was the light at the end of the tunnel.”

Here in Tari — the largest town closest to the gas fields but really just a series of squat buildings surrounding a recently fenced-off airstrip — a separate tribal war has given way to new businesses.

“No one from the outside dared to come to Tari two years ago,” said Peter Muli, 37, whose chicken restaurant, House-Kai, is now thriving.

One recent afternoon, Tari was swarming with villagers, most of them barefoot, who had descended from the surrounding hills, where they live in hamlets dotted with thatched huts. Here, they sold fruits, vegetables and coffee beans. Some men strutted around in traditional garb, wearing elaborate wigs and body paint, even as others, dressed in T-shirts and other hand-me-downs from Australia, competed fiercely at darts to win a can of Coke.

With gas exports a few years off, only a little money has begun flowing into the hands of the people here. But it has begun to worry the priests at the Catholic parish.

“You want to be optimistic but you have to be realistic,” said the Rev. Sam Driscoll, 78, a Capuchin Franciscan friar from West Virginia who has lived in Papua New Guinea for 50 years.

The money, the friars said, risked deepening existing problems like alcoholism, marijuana use and polygamy. “The people here are not ready for that kind of money,” said the Rev. Paul Patlo, a Papua New Guinean.
While conceding the danger of social disruptions, Papua New Guinea officials are adamant that the windfall will be used for development and not siphoned off by the well connected. Mr. O’Neill, the finance minister, said the government planned to channel the revenue into three sovereign wealth funds that would be overseen by a board of advisers, including foreigners, adding that the government would also be held accountable by the World Bank and other creditors.

But Michael McWalter, a former director of the petroleum division at the Department of Petroleum and Energy and a current adviser, said that corruption permeated the country’s political establishment and bureaucracy.

“Whether they will put the money into a revenue fund and steal it all in one go, I don’t know,” said Mr. McWalter, who is also a director of Transparency International here.

Father Patlo, 39, told his congregation at Hulia Parish here the biblical parable of the unjust steward, who misused money entrusted to him.

“The government and the company sit together and eat in the same place, so they must develop the country together,” he went on, but he also assigned responsibility to his listeners, exhorting them to spend their money on their children’s school fees and save any left over.

Earlier, he had held up a warning: a local village chief who had squandered a $120,000 windfall.
A short drive away, Hamon Matipe, the septuagenarian chief of Kili, confirmed that he had received that sum four months earlier. In details corroborated by the local authorities, Mr. Matipe explained that the provincial government had paid him for village land alongside the Southern Highlands’ one major road, where the government planned to build a police barracks.

His face adorned with red and white paint, a pair of industrial safety glasses perched incongruously on a head ornament from which large leaves stuck out, Mr. Matipe said he had given most of the money to his 10 wives. But he had used about $20,000 to buy 48 pigs, which he used as a dowry to obtain a 15-year-old bride from a faraway village, paying well above the going rate of 30 pigs. He and some 30 village men then celebrated by buying 15 cases of beer, costing about $800.

“All the money is now gone,” Mr. Matipe said. “But I’m very happy about the company, ExxonMobil. Before, I had nothing. But because of the money, I was able to buy pigs and get married again.”


Monday, 25 October 2010

"The [LNG] Project is Moving Forward with the Colloboration of ... the Landowners" ?

Miles Shaw, Exxon Mobil's Public Affairs Manager claims that the LNG project is "having success", do court injunctions, blockades of airports, and landowner protests count as success, I must have bought the wrong  dictionary.

First pipes for LNG project arrive in Papua New Guinea

Post-Courier website on 25 October

[By David Muri] The first shipment of pipes for the liquefied natural gas project has arrived in the country last Thursday [21 October] without much hype and fanfare. Developer Exxon Mobil said work on the pipeline is expected to start early next year.
An industry source said despite the magnitude of the project and the billions of kina in export revenue expected to be generated, the shipment did not attract a formal welcome as expected from top-level delegations. No top representative from developer Exxon Mobil, the national government or the landowners were there to receive the pipes.
The Post-Courier was notified that the first batch of steel pipes arrived at Kopi wharf in Gulf Province last Thursday.
"That was a historical moment for PNG. The country should know what was actually happening as this project would become the single biggest money spinner for decades. This shipment indicates that the pipeline will proceed soon," the source said.
ExxonMobil's public affairs manager Miles Shaw confirmed over the weekend that "I think it's probably" be in the vicinity of Kopi wharf, adding work on the pipeline would begin in 2011. He said the arrival of the pipes signifies a significant milestone in the progress of the PNG LNG project. He admitted there was no formal welcome for the shipment but assured that the media and other important stakeholders will be notified of future shipments.
"There was no formal ceremony at this time but in the future we will organize and inform the media," he said.
Mr Shaw said despite minor hiccups faced during the construction phase, he said the project was having great success.
"We are having success. The project is moving forward with the collaboration of the national government and landowners."

Friday, 22 October 2010

ExxonMobil and MCJV are "bulldozing the project": Landowners shutdown LNG operations

Komo works on notice
By ANDREW ALPHONSE  (Post-Courier 22/10/10)
A SEVEN-day stop work notice is looming at the proposed Komo liquefied natural gas (LNG) international airport in the Southern Highlands Province.
Early works including engineering, procurement and construction (ECP) phase 5 of the airport is likely to be stopped by angry landowners early week.
Yesterday, the main clans of the Hela Tuguba airport development project landowners association of Komo were seeing signing a petition to be presented to the State, LNG project developer ExxonMobil, its international contractor and developer of the airport McConnell Dowell Consolidated Contractors Joint Venture (MCJV).
The landowners demanded that before the LNG airport is developed further, they wanted the State, ExxonMobil and MCJV to address some of their outstanding issues.
The landowners made this known through their spokesmen Ipitali Koi, Kapiaru Hegele and Albert Wayali (Imini clan), Thomas Walupali and Lembo Parajia (Takima), Luke Herebe and Jackson Puti (Tapu-Undupi), Hongawi Ipura (Maya), John Lai (Tamburuma) and Olape Papu (Dapamu). They said in the next few days, they would secure the signatures of more than 100 landowner leaders from the affected land at which the airport would be located to give a seven days notice to the State, ExxonMobil and MCJV to address these issues.
They said in an earlier petition delivered on the October 9 to ExxonMobil, State and MCJV, they demanded that there be proper social mapping and landowner identification studies be carried out.
They said without a proper social mapping and landowner identification, ExxonMobil and MCJV are “bulldozing the project and trespassing on customary land”.
They also want other benefits enjoyed by other project like landowners’ business participation, compensation for the destructions of forest and environment damage, seed capital, equity, airport land rental, re-settlement program, Komo township plan, Komo airport authority and separate memorandum of agreement (MOA) signing for Komo airport.
The landowners told the Post- Courier at Komo yesterday that they were also excluded from the umbrella benefit sharing agreement (UBSA) and licensed based benefit sharing agreement (LBBSA) last year and they feel that they may miss out on the benefits if they do not act now.  The landowners warned that after securing the signatures, they would issue a seven day stop- work notice to MCJV on Monday.

Yesterday, the Post-Courier visited the Komo airport site and saw only a handful of machines and workmen working while the bulk of them remain idle at the MCJV base.

Exxon Mobil Has Form: A Case Study of Nigeria

In the world of policing "form" refers to an individual's past history of offending - those who consistently reoffend have form to commit crime again and thus arouse the attention of police officers.

Surely corporations have form. Here at LNG Watch we have reported on Exxon Mobil's activities in Aceh Indonesia, now we have a number of articles from another major area of Exxon's operations, Nigeria. The first two article examines Exxon's environmental record in Nigeria, the third examines their labour practices.  

The Oil Spill No One's Talking About

By Omoyele Sowore

July 16, 2010

This week 700 million pairs of eyes from all around the world were focused on Africa to see Spain finally win Football's World Cup. It's now time those eyes focused on another kind of ball -- balls of oil fouling the environment off the coast of Nigeria.

The story line sounds familiar. A big oil company (in this case ExxonMobil) leaks vast amounts of oil, pollutes the waters (in this case the Atlantic Ocean) killing the fish, local industries and any hopes of a rapid clean up.

It's time the world paid attention. I've been reporting this story since ExxonMobil decided to import a 30-year-old leaking oil platform to Nigeria from Angola, a platform even Angola's government regulators rejected! I'm no businessman, but that doesn't exactly sound like a good investment.

But just as BP has handled its oil spill disaster off in the Gulf of Mexico, ExxonMobil and the Nigerian government are handling things incredibly poorly too. In fact, they're trying to act as if this spill hasn't happened. American media outlets have been denied access to Nigeria. The government has imposed a 50-mile media blackout around the spill site -- from land, air and sea -- so no one can get close and see the disaster first hand. My sources tell me that ExxonMobil officials have been bribing local Nigerian officials in the hope they can "make it all go away."

But I won't let it go away. Since founding SaharaReporters.com five years ago, I have made it my job to be a citizen journalist, and report freely, accurately and fairly to expose the corruption of the Nigerian government.

Here's what ExxonMobil and the government in Nigeria don't want you to know. They don't want you to know this 30-year-old platform is still leaking at least five thousand of barrels of crude a day. They don't want you to know that they can't fix the leak (sounds familiar again doesn't it?) They don't want you to know that if the current pipes break further before they can fix the platform, it will release 60 to 100 thousand of barrels of oil a day.

This environmental catastrophe has been going on since December 2009, when I first broke the story.

ExxonMobil repeatedly denied that anything had happened, but the pictures attached to this article tell a different story. It's an eerily familiar story. There's oil on the surface of the ocean, wildlife coated in crude, fishermen losing their businesses.

Only in the last 10 days did ExxonMobil finally issue a statement to "BusinessDay and News Agency of Nigeria" saying only two barrels of oil had spilled

The timing of that statement was interesting -- perhaps because ExxonMobil had another environmental PR disaster on its hands -- this time in the United States. ExxonMobil owns the largest oil refinery in the U.S. But just last week, the Associated Press reported the Baytown refinery violated federal air pollution laws thousands of times during the last five years, releasing 10 million pounds of illegal pollution, including cancer-causing toxins. According to environmental groups, ExxonMobil got away without facing proper fines or being forced to fix equipment. Yes, it's a familiar story.

Nigeria is a country of 140 million people. Kick backs to government officials are the normal way of doing business. Perhaps that's why this oil spill hasn't got the attention it should. Journalists can't report it, but I can. And just as I finish writing this piece comes word that BP's stocks went up with news that ExxonMobil may buy it. Sounds like a partnership made in heaven.

Niger Delta Environmental Activists Accuse ExxonMobil Worse Oil Pollution in Nigeria Than BP's In The Gulf Of Mexico

June 5, 2010

Environmental rights activists in Eket, Akwa Ibom near the Qua Iboe oil export terminal operated by ExxonMobil under a joint venture agreement has accused United States of double standards regarding oil pollution issues. The environmentalists have described the reported use of dispersants near the coast by Mobil Producing Nigeria, Nigerian unit of US oil company ExxonMobil for the containment of the May 1 oil spill as a violation of  environmental standards in the oil industry.
They argued that while the United States government to protect its citizens against the impact of the Gulf of Mexico oil spill, an American oil company was perpetrating worse environmental crimes to the detriment of  Nigerians in the oil rich Niger Delta region.

The environmental rights activists under the auspices of Network For Safe and Secured Environment (NESE) told SaharaReporters that residents in coastal communities in Akwa Ibon who inhaled the dispersants experienced respiratory discomfort and took ill.

It was gathered that the practice has been ongoing for decades as the entire pipeline network at the Qua Iboe oil fields laid in the 1970’s have outlived the industrywide life span of between 15 and 20 years leading to frequent oil spills from the oil facilities.

Dispersants are chemical substances used to combat oil spills, it dissipates and breaks down the crude oil molecules and removes the oil from the water surface to the sea bed.

Mr. Bob Victor Okon an environmental scientist and  the NGO’s  Programme Director said that dispersants were toxic to both human and aquatic life addition that its use was restricted to offshore locations away from human settlements.

 “The use of dispersants in the control of oil spills is usually not contemplated by environmentally conscious societies because of the impact of the chemicals on the marine ecosystem, it has been scientifically proven that dispersants increase the toxicity levels in the marine environment beyond tolerable limits.

“It is usually not recommended near human settlements because of its toxicity to fish eggs, fingerlings and other aquatic life; so there is need for the oil industry regulators to be more discerning before approving the use of toxic chemicals to mitigate oil spill” Okon said.

He said that the NGO was concerned about the toxicity level of the coastal waters since the application of dispersants which distorted the food chain and challenged the management of the oil firm to urgently take steps to remediate the damages done to the environment.

 “We demand that Mobil should immediately start conservation projects in its host communities to mediate the damages done to the environment since they commenced operations in the 1970’s, this will restore the environment to its natural state

“This is in addition to the conduct of an independent study on the toxicity of the coastal waters to determine when it will become safe to advise fishermen to commence  fishing activities which was suspended when the spill occurred in May ” Okon said.

Okon regretted that Nigeria leaders lack the awareness and interest in environmental issues and were ill prepared to engage oil firms to maintain high safety and environmental standards in their operations but rather collaborated with Multinational oil companies to perpetrate crimes against the environment that cannot be tolerated in their home countries.

“Nigerians are at the receiving end and we cannot allow multinationals to flout our environmental laws, look at how the US President reacted when a British oil firm BP had an oil spill that affected American citizens but an American oil company, Mobil frequently does the same thing here and it is swept under the carpet”, Okon said.

In a reaction to the allegations of using toxic chemical dispersants to contain the spill, Mobil Producing Nigeria Management wryly said that dispersants does not pose any health hazard.

“Dispersants are not toxic to humans, they evaporate immediately after application.  They do not constitute health hazards to humans and aquatic life.  Dispersant use is approved by regulatory agency” a company spokesman said.
SaharaReporters investigations however showed that Mobil did not obtain the said approval from the Nation Oil Spills Detection and Response Agency empowered by existing legislation to grant approval for the use of dispersants in oil spill incidents.

Exxon Mobil Victimises Union Staff

10 March, 2008

Mobil Oil Nigeria Plc. has become an anti-social force blocking workplace solutions to the downstream oil section of Nigeria. And the company’s actions last week leave no doubt as to its intentions – it seeks to operate its technical and white-collar work units in downstream production with non-union staff.

The company, 100% owned by US-based ExxonMobil, refused to attend a mandated mediation meeting called by the Nigerian Labour Ministry, on 3 March 2008, to resolve differences on work practices and severance procedures with white-collar oil workers’ trade union, PENGASSAN.

Through much of 2007 and into 2008, ICEM-affiliated PENGASSAN and Mobil Oil – as they did similarly with other oil refiners – engaged in negotiations over severance packages. Some intermediate agreements had occurred, but implementing practical application of job separation was elusive.

That process spilled into the Labour Ministry. Senior Nigerian managers of three downstream firms operating in Nigeria did attend the meeting with Nigeria’s Labour and Industrial Relations Director a week ago. But Mobil Oil Nigeria failed to show up.

In the days following that 3 March meeting, the American company displayed its prejudice: it unilaterally sacked PENGASSAN branch leaders, including the zonal Financial Secretary and the union’s National Treasurer. It now has severed from employment all PENGASSAN bargaining committee members who represent workers in collective negotiations.

It also has fired shop stewards and others identified with the union, rising to over 100 the number of full-time workers sacked. In last year’s talks, PENGASSAN and Mobil Oil Nigeria had agreed to staff cuts of just over 40, mostly to accommodate a new data processing system. The company did employ about 400 white-collar staff permanently, but that number has now decreased, with contract and agency workers now taking many of those jobs.

“Mobil Oil Nigeria has betrayed our trust,” stated PENGASSAN General Secretary Bayo Olowoshile. “These recent actions are pre-meditated attempts to victimise and harass union officers, frustrate legal justice, and they amount to a serious breach of our existing labour agreement, national industrial law, and global labour standards.”

Olowoshile said Mobil has violated terms of the 2007-2008 labour agreement; breached Section 40 of the Nigerian Constitution, which grants rights to membership in trade unions; ignored Section 9 of the Nigerian Labour Code; and disregarded ILO Convention 135, the Worker’s Representatives Convention.

With the company failing to turn up for 3 March mediation session, the Labour Ministry is now expected to side with PENGASSAN in a National Industrial Court matter over the company’s unilateral actions. The three downstream companies that did engage in last week’s mediation session included Chevron, African Petroleum Plc., and Oando Plc. The labour relations of Shell Nigeria’s downstream operations are not affected in these talks.

The ICEM steadfastly stands behind PENGASSAN and its illegally sacked leaders at Mobil Oil Nigeria, and will work toward reinstatement. The Global Union Federation notes that the company, in 2004, replaced all its permanent blue-collar workers in the downstream sector with agency workers. Those full-time staff had been represented by ICEM affiliate NUPENG.

Thursday, 21 October 2010

LNG in the News: Australian Companies Awarded more than US$1 billion in contracts


The following information was released by the office of the Export Finance and Insurance Corporation of Australia:
Export Finance and Insurance Corporation (EFIC), the Australian Government's export credit agency, has issued two performance bonds to support the participation of a Queensland construction materials group, the Wagner group of companies (Wagners), in the ExxonMobil-led liquefied natural gas (LNG) project in Papua New Guinea(PNG).
Companies in the Toowoomba-based group have won multi-million dollar contracts to supply, install and operate two concrete plants and to supply concrete and quarry products for the US$18 billion LNG project in the PNG Southern Highlands.
Wagners will supply Japanese engineering and construction firms Chiyoda Corp and JGC Corporation, whose joint venture CJJV is building the LNG plant for Esso Highlands Ltd, a consortium led by ExxonMobil.
EFIC has provided two performance bonds to CJJV on behalf of Wagners.
'The Australian commercial banks would have required full security to issue the performance bonds to a party in a foreign jurisdiction and we couldn't afford to tie up our cash resources in that way', said John Watts, General Manager of Wagners Global Services.
'EFIC's bonds have freed up our working capital, enabling us to deliver this large-scale contract in a challenging location', said Mr Watts.
EFIC has provided a US$350 million loan to the broader PNG LNG project, joining an international syndicate of export credit agencies and commercial lenders.
'By participating in the financing of the PNG LNG project, EFIC is supporting Australian exporters like Wagners who are pursuing contracts for the construction phase of the project', said EFIC Executive Director, SME, Andrea Govaert.
'So far, Australian companies have been awarded more than US$1 billion of work, and there are further substantial sub-contracting opportunities available', said Ms Govaert.
Wagners will install and operate two ready-mix wet-batch mobile concrete plants and supply around 130,000 cubic metres of cement for the construction of the LNGplant in Papua New Guinea.
Wagners has considerable experience in establishing and operating concrete plants at remote LNG and mining sites, both in Australia and overseas markets such as New Caledonia, Equatorial Guinea, Indonesia and Russia.

Wednesday, 20 October 2010

Landowner Groups and a Derelict State - A Recipe for Corruption

Landowners disorganised
By MOHAMMAD BASHIR (Post-Courier, 22/10/10)
A good number of the 38 Hides PDL1 and Hides PDL7 landowner companies recommended for payment of seed capital were one-man shareholding companies while several were not registered with the Investment Promotions Authority.
Although Commerce and Industry Acting Secretary John Andreas recommended Treasury Secretary Simon Tosali to pay those lancos and umbrella companies the BDGs expeditiously, the criteria breached the 10 strict guidelines set by the department itself.
While Mr Andreas agreed the payments stalled as a result of the court injunction taken out by Gigira Development Corporation chairman Stanis Talu, he could not elaborate because the matter is subjudice. The first 13 BDG cheques were successfully disbursed to landowner companies identified under the LBBSA in September by Minister for Commerce and Industry Gabriel Kapris ,witnessed by senior officers of line Government agencies.
Hides Gas Development Corporation was to be paid 30 per cent which equated to K5 million, but it was to be withheld until its restructure, which is currently underway, was completed.
Under the MoA provision 1.3, 30 per cent of the umbrella lancos to be paid K3 million each were Hides Gas Resource Ltd and Hides PDL1 Development Corporation Ltd. PDL1 submissions for block companies (EOI applicants) were to receive 40 per cent, which equated to K1 million but the companies were not specified. The rest of the approved lancos for PDL1 include Hiwa Corporation Ltd (K1,750,000), Tuguba PDL1 Ltd (K612,000), Tuguba Original Investment Ltd (K612,000), Tuguba Development Corporation (K262,500), Tugu-ba Investments Ltd (K262,500), JP Karai Pupa Holdings Ltd (K437,500), JP Karai Hides Ltd (K437,500), Tugu Tapira Ltd (K437,500), Tugu Kuara Tapira Nane-Hene Ltd (K437,500), Buluaro Holdings (K297,500), Hides Resource Owners Investments Ltd (K402,500), Mbuta Lunguni Holdings Ltd (K87,500), Ilu (K87,500), Bele Holdings Ltd (K350,000), Koe-Ebi Dev Corporation Ltd (K218,750), Kamia Kera Holdings Ltd (K87,000), Tuguba Holdings (K218,750),

For PDL7, HGDC was to get K3 million which is also 30 per cent and would also be withheld until completion of restructure while the 30 per cent umbrella lancos include Gigira Hides 4 Joint Venture (K3,000,000), Gigira Parepare Resources Ltd (K1,500,000), Hides 4 Parepare Holdings Ltd (K700,000) and Kewapa Development Corporation Ltd (K700,000).
The 40 per cent block allocation include Tuguba Nguane Investments Ltd (K300,000), Kayumba Hides 4 Development Corporation (K800,000), Komo Haliago Development Corporation (K500,000), Tawanda Tokaju Holdings Ltd (K300,000), Well Head Tuguba Middle Holdings (K500,000), Hides Gas Field Development Corporation (K500,000), Hape Holdings (K900,000), Hides 4 Womens Umbrella Association (K100,000), Hides 4 PDL7 Womens Umbrella Company Ltd (K400,000) and Hides 4 Landowners Umbrella Association Inc. (K1,000,000).
Mr Andreas said in his letter to Mr Tosali that it has become necessary for DCI to resubmit the list for Hides PDL 1 and Hides PDL 7 due to the sensitivity of those projects areas and associated disputes that are likely to arise from disparities in benefit distribution.

Tuesday, 19 October 2010

Gigira Development Corporation seeks restraining order

BDG payment for 38 lancos put on hold
By MOHAMMAD BASHIR (Post-Courier, 19/10/10)
The Department of Commerce and Industry (DCI) finalized 38 landowner companies (lancos) for Hides PDL1 and PDL7 licence areas to be paid their business development grants and forwarded it to Treasury department last week, citing sensitivity in those areas. That has unfortunately been put on hold because a restraining order has successfully been taken by chairman of Gigira Development Corporation chairman Stanis Talu against DCI, Finance and the State from making any payments.

On September 13, DCI acting Secretary John Andreas in a letter to Treasury Secretary Simon Tosali listed the 38 approved lancos and associations to be paid BDGs.
The first 13 lancos for other licence areas were paid on September 7 by Commerce and Industry Minister Gabriel Kapris at March Girls resort outside the city in a low key ceremony.  “I refer to my earlier letter to you and once again request for your concurrence in facilitating payments for Hides PDL 1 and PDL 7. We have successful disbursed the first 13 cheques to Landowner Companies identified under LBBSA at a low key ceremony held at the March Girls Resort on September 7.  Minister for Commerce and Industry, Gabriel Kapris and senor officers of line government agencies were present during the ceremony".

“It has now become necessary for DCI to resubmit the list for Hides PDL 1 and Hides PDL 7 due to the sensitivity of those projects areas and associated disputes that are likely to arise from disparities in benefit distribution. The list of companies is retyped on the body of this letter to avoid tampering of the list which is highly likely considering the amount of money to be disbursed and the ongoing politics of the project,” Mr Andreas wrote.
“It is from our view that this list is final. The list was developed through an exhaustive consultation process with ExxonMobil, Oil Search, Landowners and DCI acting on behalf of the State. Most of the companies listed have also submitted EOI’s to DCI for seed capital and the nomination process is complete,” he added.
The list Mr Andreas said was a generally agreed position by key stakeholders of the project and must be facilitated as soon as possible. He said delays may cause the State problems in mitigating court injunctions that are currently becoming a common practice by disgruntled landowner companies.
“The position of DCI is to allow the 30-30-40 percentage distribution split to be applied fairly across licensed areas for Hides PDL 1, Hides PDL 7, Angore PDL 8, and Juha PDL 9. The State’s official position in response of Hides PDL 1 and PDL 7’s nominated Lancos falls within the framework of NEC Decision 95/2010, directives 5, 7 and 9,” he said.

Post-Courier- Tari hospital has no proper doctor

By ANDREW ALPHONSE  19/10/2010
THERE is no doctor at the Tari district hospital in the Southern Highlands province.
Hundreds of sick people who flock in each day from the far-flung Hela regions of Komo-Margarima, Tari-Pori and Koroba-Lake Kopiago are now served by a veteran health extension officer (HEO) Michael Ekalia and a handful of nurses at the hospital.
Thanks to the establishment of international medical organisation Medecins Sans Frontieres (MSF) or Doctors Without Borders, injuries, wounds, accidents including lifesaving emergency surgeries are carried out on Hela patients free of charge.
However, people with common ailments, diseases and health problems seeking medical assistance and examinations at the hospital cannot be attended to by a qualified doctor. Following the sudden departure of acting chief executive officer Dr Bravy Koensong in June, the hospital that serves more than 300,000 people in the Hela region has no doctor to attend to their medical and health problems.
Dr Koensong who was posted to Tari in mid August 2008, worked hard to improve the services at the hospital but left after threats by locals who alleged that he had mismanaged its affairs. Dr Koensong has since then moved to Mendi where he is serving at the provincial health office. Provincial health adviser Thomas Anda appointed senior nursing officer Tobias Hapolo to take charge of the hospital administration during a visit to Tari in July. Mr Anda could not be contacted for comments yesterday.

Nurses at the hospital said yesterday that they sometimes played the part of qualified doctors and physicians to serve people coming with common tropical sicknesses and other medical problems. The nurses also said without a doctor to manage the affairs of the hospital, nearly half of the 46 nursing staff at the hospital had walked off from their duties and are roaming around the streets of Port Moresby, Mendi, Mt Hagen and other main centres while on full pay.
“It is unfair when some of us are committed to our job in serving the sick and dying in Tari while our other colleagues are absent from duties and turn up shamelessly at ATMs on paydays, getting paid for doing virtually nothing".
“There is no proper control and discipline mechanism at the provincial health office in Mendi so that is why staff just walk off duties at will,” a nurse who requested anonymity said.
The nurses also complained that despite their services to the hospital, they have being overlooked for increased benefits for nurses like overtime allowances, special awards and other benefits which their colleagues in the country in other hospitals and health centres are enjoying. They called on health secretary Dr Clement Malau to look into their welfare.

To the Victors go the Spoils

InterOil to Partner With Energy World to Construct a Two MTPA Land-Based LNG Plant

Energy and Ecology, 15/10/10
InterOil Corporation (NYSE: IOC) (POMSoX: IOC) announced that InterOil and Liquid Niugini Gas Ltd., its Joint-Venture liquefied natural gas project company with Pacific LNG Operations Ltd., have signed a binding Heads Of Agreement (HOA) with Energy World Corporation Ltd. (AX: EWC) to construct a two million tonne per annum (mtpa) land-based LNG plant in the Gulf Province of Papua New Guinea (PNG).

The Train 1 LNG plant would process an estimated 1.5 trillion cubic feet (Tcf) of natural gas over 15 years with early stage capital expenditure estimates amounting to US$455 per metric tonne of LNG production. In return for its commitment to fully fund the plant, the HOA provides that EWC is to be entitled to a fee of 14.5% of the proceeds from the sale of LNG from the plant, less agreed deductions, and subject to adjustments based on timing and execution. The HOA sets out the major terms and conditions which the parties intend to include in the Train 1 Funding and Shareholder's Agreements, as well as a potential expansion of the plant's capacity from 2 mtpa to 3 mtpa.

The HOA with EWC for the development of a mid-sized LNG plant is an opportunity to enhance the proposed condensate stripping plant (CSP) being pursued in joint venture with Mitsui and accelerate the intended monetization of the Elk and Antelope resource.

Infrastructure required for the LNG project includes a jetty and breakwater for the LNG loading facility with expansion potential, and approximately 50 mile (80 Km) pipeline from the Elk and Antelope fields to the coast. The wells and processed natural gas pipeline from the CSP to the coast in the Gulf Province will be the responsibility of the owners of the Elk and Antelope fields, including InterOil and its upstream partners.

Definitive agreements are under negotiation with a view to being finalised by the end of December 2010, assuming completion of engineering and design work, financing and shareholder agreements with EWC, and further regulatory approvals. The current schedule aims for these LNG facilities to be operational by late-2013, hoped to coincide with the start-up of the proposed CSP joint venture with Mitsui.

Monday, 18 October 2010

LNG in the News: Somare hails progress of Kroton No. 2

Post-Courier (18/10/2010)
PUBLIC Enterprises Minister Arthur Somare, said yesterday he was pleased to be briefed by the chairman of Kroton No. 2, Kerenga Kua on progress with the PNG LNG Project, which is scheduled to commence LNG exports by early 2014.
Mr Somare expressed confidence the recently appointed interim board and management of Kroton No. 2 will play a positive role in managing the 19.6 per cent stake held by the PNG Government in the PNG LNG Project. A full board will be appointed after the legislation for Kroton No. 2 is enacted by Parliament.
Mr Somare noted that Mr Kua has extensive legal and practical business experience especially in the mining and petroleum sectors that would be of value to Kroton in its formative stage.
It will take on the key liaison work with the project manager, ExxonMobil, to ensure the National Government through the Ministry for Public Enterprises and the National Executive Council is aware of all project developments in anticipation that construction would be completed by the end of 2013. 
The schedule driven nature of the construction phase will require all stakeholders to provide maximum value to ensure costly delays are avoided.
Kroton will also keep a close watching brief, as a direct equity participant in the project, on ongoing issues that need to be resolved between the National Government and project area Landowners, such as the issue of Business Development Grants or ‘seed capital’.
As the State’s nominee in the PNG LNG Project, Kroton No. 2 was uniquely placed to play a significant role in managing project related issues such as project security and maintenance of the rule of law and in ensuring the necessary capacity building to enable various arms of government to efficiently handle the large inflows of people and equipment needed for this $US15 billion venture.
An interim board of directors has been appointed for Kroton No. 2 to establish the corporate entity and commence operations as the State’s Equity participant in the PNG LNG Project following the National Executive Council Decision on May 12 this year. (NEC Decision No. 88/2010).
The board consists of well-known PNG lawyer Kerenga Kua as Chairman with the Acting Secretary of the Department of Public Enterprises, Mathias Lasia, and a nominee from the PNG Treasury, Igimu Momo, appointed as directors. Mr Kua, who hails from Kundiawa, has been president of the PNG Law Society since 2003, Deputy
Chairman of Nambawan Super and Chairman of Finance Corporation.  He is a former managing partner of Posman Kua Aisi, where he was partner in charge of commercial litigation from 1993 to June this year.
A more permanent Board representing all relevant stakeholders will be appointed in due course as Kroton’s legislation is passed by Parliament. More broad based participation by Landowners and Provincial Governments is envisaged through exercising of a call option on up to 25.75 per cent equity that was negotiated from the Benefits Sharing Agreement process in 2009.

The Board appointed has further appointed Mr Dairi Vele as Interim Chief Executive Officer, Brian Rapson as Chief Operating Officer, Geoffrey Emang as General Counsel and Pertusio Capital Partners as Strategic Advisers.
Mr Vele has formally resigned as Project Director of the Gas Projects Coordination Office and officially commenced his role at Kroton No. 2 on 11 October 2010.
The NEC decision also involved the separation of Kroton No. 2 operationally from IPBC. It is envisaged the Government will be announcing the new arrangements for the Gas Project Coordination Office to facilitate the development of the PNG LNG Project and other gas commercialization initiatives in the near term.

Sunday, 17 October 2010

Should PNG Do Business with a Sponsor of State Terrorism?

Exxon Mobil has considerable interests in Indonesia.

Should Papua New Guinea place a moratorium on companies that do business with a state who tortures and kills our brothers and sisters in West Papua? This disturbing video has just been released on youtube (warning it is VERY upsetting):


For more information on this video see:


Exxon Mobil Around the World: Nigerian Staff Threaten Strike Over Expatriate Dominance

Strike: PENGASSAN issues Exxon Mobil Thursday ultimatum

By Victor Ahiuma-Young

LAGOS—THERE are strong indications that workers of Mobil Producing Unlimited, Exxon Mobil, may Thursday begin an indefinite strike over alleged non-compliance of management to the National Content Act and other applicable laws on expatriate staff as well as systematic easing out of Nigerians from the company.

Vanguard gathered that under the aegis of the Petroleum and Natural Gas Senior Staff Association of Nigeria, PENGASSAN, the aggrieved workers had about two weeks ago, issued a 21-day ultimatum to the management of the upstream oil giant to among others, comply with National Content Act and other applicable laws on expatriate staff and halt the systematic easing out of Nigerians from the company or risk indefinite industrial unrest.

The ultimatum, Vanguard gathered, will expire this Thursday and there is no indication that management is ready to address the grouse of the workers.

The aggrieved workers said among others, noted that the current situation where the Board of Directors and management staff are dominated by expatriates others was completely unaccepted and must be addressed for industrial peace to reign .

A More Interesting Piece from the Post Courier

Sinalis lost tribe of LNG project

MOHAMMAD BASHIR - Post Courier 14/10/2010 

The Sinali speaking people number just over 4,000 and live in the middle of nowhere between Koroba in the Southern Highlands Province and Nomad in the Western Province.

They are principle landowners of the Juha gas project licence No.PDL9 and they are not Hulis.
Sadly, none of them are educated accept only one who has reached grade 10 and is currently employed by the Department of Petroleum and Energy. The rest live like their forefathers, gardening the land and hunting the bushes everyday.

Politically, they come under the Koroba Lake Kopiago electorate but culturally, they are Nomads. To get to either Koroba or Nomad stations on either side, they travel 7 days and nights.

The multi-billion kina PNG LNG project is right on their door steps and has brought more confusion than good.

As a minority group in a backward area of the Southern Highlands and with only 12 clans, they have no access to schools, health services nor road links.

Mr Alex Tao has been the councillor of the Sinalis for 15 years. He is also the village court chairman and chairman of a new umbrella landowner company called Sinali/Juha Central Co-ordinating team Development Corporation Ltd.

The 12 clans include Demah, Yewesoso, Moyo, Kasomu, Gumitia, Sambu, Yowomo, Yetipi. Sili, Uwo, Waitie and Kofipi. Their leaders are Alex Tao, Frank Neabi, Moyo Beia, Sai Jerop, Pr Mekeya, Pr Sii, Egiso Yowomo, Dickson Dugubi, John Wapi, Jeremiah Kakala and Gua Ipi.

Mr Tao yesterday told the Post-Courier that God Almighty created Juha land and blessed it and placed his people there as custodians. He was concerned that people from Duna, which is in Tari and Koroba Kopiago who claim to be Juha landowners and were making submissions to the Government for grants and other entitlements.

"We still live a very primitive lifestyle (stone age) and the gas project at Juha is a blessing which will rescue us and God the creator is watching,"

"We do not want anyone, Tom, Dick and Harry from Huli, Duna, ie Tari, Koroba or Kopiago to claim as landowners and register companies with IPA under Juha project including umbrella companies on our behalf" Mr Tao said.

He warned the Government to be weary of such con groups going around in Port Moresby with such dubious claims.

He warned those not from Sinali that "the sun is watching and the sun will burn you, even at night and your days are numbered. Leave us, the Sinali people of Juha (PDL 9) alone and don't jeopardise the project."