PNG Landowners Submit Equity-Sharing Offer For ExxonMobile LNG Project

Prime Minister O'Neill urged to accept Hela province proposal

WELLINGTON, New Zealand (Radio New Zealand International, March 29, 2017) – Papua New Guinea's prime minister Peter O'Neill has been urged to accept an offer by landowners for an equity arrangement in the LNG project.

A collective of Hela province landowners from the ExxonMobil-led LNG project have reportedly raised USD230 million to pay government for 4.27 percent equity in the project.

The Governor of East Sepik Sir Michael Somare, said he was pleased to see landowners have gone out on their own and sourced independent funding to pay for their equity in the liquefied natural gas project.

A former Prime Minister, Sir Michael said Mr O'Neill should honour the previous government's commitment to facilitating landowner participation in the landmark project.

Hela landowners have repeatedly voiced frustration at the lack of any benefits from the project which is based around gas fields in their province, and began exports in 2014.

Last year, the landowners complained that that new changes to the 4.27% equity interest in the project being introduced by state-owned Kumul Petroleum Holdings Ltd erode the value of their equity.

According to PNG media, Treasurer Patrick Pruaitch had written to the Prime Minister recommending that the landowners offer be accepted as it was better than Kumul's proposal.

Meanwhile, the Sinasina Yongomugl MP Kerenga Kua described the landowners' offer as historic as it was the first time any landowner group had sourced independent funding to buy equity into a petroleum project.

"I commend the landowners in being proactive and seeking out their own funding options instead of waiting for the government to act on their behalf," said Mr Kua.

"The timing of this offer is also suitable given the ongoing financial crisis faced by the government especially in an election year."

Mr Kua said the amount offered by the landowners was appropriate as it was based on how much the government had paid for its shares in the LNG project.

Echoing the PNG National leader, Sir Michael, agreed that landowners "should not be made to pay a higher price than the government, ExxonMobil or (project partner) Oil Search."

"While government has not completed its part in the clan vetting process, this has not stopped these particular Hela groups from doing

their part in ensuring their people participate in benefit sharing in the PNGLNG project," said Sir Michael.

"I therefore call on Peter O'Neill to hear the cries of these Hela people. You look after Hela and Hela will continue to look after the rest of PNG. Their free carry payments are still outstanding and so are their royalty payments."

Radio New Zealand International
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