"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

Tuesday, 12 June 2012

Job crisis threatens as PNG LNG project moves to next phase

Pacific Beat, Radio Australia, 11 June 2012

In Papua New Guinea, concern is growing about the unemployment and social dislocation that will occur as the PNG LNG project starts to lay off many of its more than 8000 strong Papua New Guinean workforce.
Construction of the giant project is progressing so well that many of the jobs held by Papua New Guineans will start of come to an end, this year.

Landowner companies are warning of unrest if new jobs are not found for them.

Presenter: Jemima Garrett

Speakers: Peter Graham, Managing Director of ExxonMobil subsidiary Esso Highlands

Libe Parindali, Chairman of Hides Gas Development Company, the main highlands-based landowner company working for the PNG LNG project.

GARRETT: It has long been known the prime job opportunities offered by the ExxonMobil-led PNG LNG project would occur in the construction phase.

Now at its peak, the project employs more than 16,000 people. Over half of those are Papua New Guineans, many employed through landowner companies that have been set up especially, to cater to the project.

The bulk of the jobs are places like Hides and Komo in remote Hela province in the PNG Highlands, where the gas is located.

Peter Graham, Managing Director of Esso Highlands the PNG LNG project operator says the project is on time to deliver first gas in 2014, and to put first gas into the pipeline in the second quarter of 2013.

That means some of the construction jobs are about to wind up.

GRAHAM: In 2012, a number of the major contractors do finish their work. The offshore pipeline is complete, or will be complete within the next several weeks. The Komo airstrip will be complete by year end. The civil works on Hides Ridge and around the Hides Gas Conditioning Plant will be complete, so by the end of this year we will be focussed very much in the LNG plant site and the Hides gas conditioning plant site and the pipeline area.

GARRETT: The biggest landowner company, Hides Gas Development Company, is just 3 years old.

In that time it has gone from nothing to employing thousands of landowners, many of whom are getting their first taste of paid employment.

The cash has been a boon to families who are used to struggling without electricity and basic services.

But, Company Chairman, Libe Parindali, is concerned that as construction winds down families will hit the financial wall.

PARINDALI: Right now, you know the PNG LNG Project, in the area where I come from, we are creating too many unnecessary expectations! And we will have, those 2000 or 3000 people that we have on our books that we are supplying to the (project). After the construction phase is down, we will be left with 300-400 people! What are we going to do with the rest of them that will not have jobs?

GARRETT: Mr Parindali says the potential for unrest is real.

He wants help so the Hides Gas Development Company can diversify the opportunities open to landowners.

PARINDALI: We can take on other projects, like the infrastructure, the community projects, agriculture, forestry - you know something that is sustainable and something for the long-term. But what the contractors are doing now is they are focussed on trying to deliver the gas in 2014, that is their focus right now but something to sustain the community, I think the government and the company, need to seriously go back and look at it now!

GARRETT: Government infrastucture projects have been slow to get off the ground.

Esso Highlands Managing Director, Peter Graham, agrees a sharp drop in job opportunities is not ideal.

GRAHAM: We share the concern about the demobilisation of people. They are trained people, they have worked hard and contributed to the project. We'd like to put their skills and expertise to work productively in the community. How that is done is not absolutely clear to me at this point in time. We've got the infrastructure projects with government that will offer opportunities. It would be nice if those people can move progressively into that area and work in those sorts of projects, or to various mining projects.

GARRETT: Until now Esso Highlands has ensured landowners get jobs by reserving certain activities for landowner companies.

HGDC Chairman, Libe Parindali, wants the number of reserved areas extended.

PARINDALI: The so-called reserved business area activity needs to be opened up. Now they allow us to do light vehicles, catering, security , labour hire, camp maintenance but what is there for the long-term? We strated this company, HGDC from nothing and now its over 2 years, ExxonMobil has helped us to set this company up, it is set up to promote landowner participation, and after the construction phase, the 5 areas, what is there? How much are we going to make? I can't sustain this animal and the expectations that we have created!

GARRETT: Peter Graham does not believe extending the range of jobs kept exclusively for landowner companies, is viable.

GRAHAM: We work to a schedule and we have a lot of people trying to deliver this project on schedule. We've got customers waiting for the gas to come through, so we end up having to make a judgement call as to whether or not particular individuals and companies have the potentiual to do particular work. I mean, I get requests coming to me, a company saying I want to be the company that installs the pipeline. Well, I am not going to give a contract for the installation of a gas pieline, with critical welding and safety issues, to a company that has never been in that business. So its sort of horses for courses. I think there are some areas where we would be happy to try and work with landowner companies to expand into other businesses. I think, again, HDGC has done some of that, they have partnered with an engineering firm out of Huston and they are already benefitting from that kind of experience and expanding their range of skills.

GARRETT: Libe Parindali says landowner companies have the skills, capital and the overseas partners to do more.

He says it would be in ExxonMobil's interest to make it happen.

PARINDALI: If we give the jobs away to outsiders, they will not worry about us and then outside the fence we will have the people with high expectations, who cause problems for the project. And they are the ones I want to help, I want to train them, I want to upskill them, develop them to be somebody the community and the people of PNG can be proud of. We are not doing it now. Government is not in there helping us!

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