PNG Offloads Shares Of Ok Tedi, Panguna To Landowners, Local Governments

Recently acquired shares of Rio Tinto to go to Bougainville

BY Gorethy Kenneth

PORT MORESBY, Papua New Guinea (PNG Post-Courier, August 18, 2016) – The Government has offloaded its shares in Bougainville Copper and Ok Tedi gold and copper mines to the respective landowners and provincial governments.

It will also implement decisions by the previous government on landowner benefits associated with the liquefied natural gas in five provinces.

The milestone decisions were announced in Parliament yesterday by Prime Minister Peter O’Neill. In the decisions endorsed by the National Executive Council, the 17.4 per cent of the State shares given by developer Rio Tinto recently will be given to the Panguna landowners and people of Bougainville. The State will retain its initial 19.2 per cent shares.

The NEC agreed to transfer 33 per cent, one third of Ok Tedi Limited equity, to the people of Western Province who comprised landowners, affected villages and the provincial government.

Further, the State will implement the decisions that the previous Government has taken including the distribution of equity and the benefits that are due to the people of Hela, Southern Highlands, Gulf, Central and Western provinces on the PNG LNG Project.

"We are committed to giving direct participation in resource developments in our country so that our landowners can take ownership, and build capacity in order to sustain their own livelihoods and their communities," Mr O’Neill said in a ministerial statement.

"The people of Bougainville have been through too much pain over the past 30 years, and should not face further frustration and confusion because of politics," O’Neill said.

We are aware of the pain and torment that the people of Bougainville have gone through, and the importance of land.

"We are announcing to this House that the Government of Papua New Guinea will transfer this 17.4 per cent, to the landowners and the people of Bougainville.

"With this transfer, the people of Bougainville will own a combined shareholding of 53.8 per cent of BCL.

"This will ensure that for the first time in history of BCL, the landowners will be given a direct say and direct participation in the operation of the BCL mine.

"Under the UBSA agreement, the landowners and Provincial Government were to pay the State close to US$1.1 billion for 4.27 per cent equity in PNG LNG.

O’Neill in his statement to Parliament yesterday also said given the current market conditions, where the oil price has collapsed from US$110 per barrel down to US$27, it is quite impossible for the landowners and Provincial Government to raise that money.

"That is why NEC has approved that it will extend the time that expired on the 30th of June, to be extended to 31st December 2016, so they can have the opportunity to raise more funds over the next few months," he said.

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