Emmanuel MAIPE

The three national Parliamentary Members of the Gulf province are expected to have an urgent meeting with the prime minister today to go over their issues that they have raised regarding the Social Mapping and Landowner Identification Study (SMLIS) conducted for the Papua LNG (PLNG) Project. The Gulf Governor, Chris Haiveta, said this meet up was already agreed upon last week in another meeting with Prime Minister (PM) James Marape, to hear their side of the story regarding matters relating to no proper identification of landowners of the project areas and other matters. This meeting today with the PM comes just weeks after the Ministerial Determination was issued by the Minister of Petroleum and Energy, Kerenga Kua on the 5th of December. The three leaders, Mr. Haiveta along with the Member for Kikori, Mr. Soroi Eoe and Member for Kerema Mr. Thomas Opa, are concerned that major issues on the ground are not adequately and properly addressed by the Minister and the Department according to the Oil and Gas Act 1998. Governor Haiveta stated that there was no proper consultation done before the SMLI report was put out because the study was done some years earlier and didnt cover every concerned landowner groups in the project areas. I believe it was a mistake InterOil company made and when Total and its JV (Joint Venture) partners came in, they just carried out what has been done and the minister, based his determination on this study, said the Gulf Governor. Three of us after studying some of the issues in that report, feel that it has basically missed out many things. As such, the provincial government made a submission to the Minister for Petroleum and Energy. The submission was simple; review the pipeline agreement, review the SMLI Study because we have landowners who are missing out. This is 2023 and the provincial government has not had a feedback yet. The Members are frustrated over this because they say the government has not considered their own fact finding reports of landowner groupings and has over looked their reports. My view is that the SMLI report for the Papua LNG is a flawed report because it has not consulted the issues that we have raised, said the governor. Meanwhile, the three Members in a joint statement said that they have independently raised concerns with the Minister about no proper and independent SMLIS done by the department in compliance with Section 47 (6) of the Oil and Gas Act. They said the government cannot and should not use the SMILS done by the Developer when it has not provided the scope of such studies. They also said the Department of Petroleum and Energy (DPE) did not apply the scope in its Landowner Beneficiary Identification (LOBID) program and solely relied on the Developers SMLIS; therefore, a conflict situation exists in that the Developer has different agenda, which is to maximize profit, whereas the government has social and environmental responsibility. The leaders said these two issues should not be confused and by failing to do an independent SMLIS, the DPE has failed the people and its legal mandate as well. Nevertheless, the three leaders of the Gulf province give their support to the PM and the government because this massive second LNG project is important to the country and the people of Gulf, but the outstanding issues of concern must be properly addressed so the project is not unnecessarily compromised or delayed. The leaders also stressed that everyone must learn from the mistakes made in the current PNG LNG project and not repeat it again.

The Porgera Mine in the Enga province has finally reopened for business following its commissioning after over three years of its closure of operations. The New Porgera Limited (NPL) announce that this was achieved yesterday, Friday 22nd December under the Porgera Project Commencement Agreement (PPCA), marking the start of “New Porgera” and the resumption of operations at the Porgera gold mine, which has been in care and maintenance since April 2020. The historic agreement reached between the Marape Government and leading global mining companies, Barrick and Zijin Mining, in April 2021 provides for greater ownership and economic benefits for Papua New Guinea (PNG) stakeholders, while ensuring a fair return to the overseas investors. This first of its kind partnership between PNG and two leading global mining companies, for the first time, gives a majority ownership in a major resource project to PNG shareholders. The mine will be operated by Barrick through Barrick Niugini Limited (BNL). Porgera Mine holds the potential to become one of the world’s most profitable gold mines, and will provide a platform to train and promote a generation of Porgerans and other Papua New Guineans to join the ranks of the world’s best miners and mining leaders in the world. New Porgera is also committed to prioritizing and growing local contractors and businesses. The closure of the mine in 2020 highlighted the mine’s importance to the Porgera valley, Enga province and the national economy. Law and order deteriorated while the mine was shut. So, the reopening of the mine has been welcomed by all stakeholders, whose support is critical to Porgera being able to realize its extraordinary potential and deliver decades of value. To guarantee Porgera’s long term success, that value must be shared between all PNG stakeholders, not just a privileged few. Sarimu Kanu, Chairman of NPL, commenting on the restart said that the reopening of operations marks the official birth of New Porgera – a mine now majority owned by PNG stakeholders. “We now embark on the journey of getting the mine back to full production, there is much to do,” said the Chairman. “The team will be completing the commissioning over the coming weeks to pave the way for mining and processing operations to restart in the first quarter of 2024. Everyone should look forward to seeing the white smoke rising again over Porgera next year.”

In a move that would see the landowners of the Papua LNG (PLNG) in the Gulf province benefit from the spin- off businesses from the country’s second major LNG project, saw the landowner groups launch their first ever landowner umbrella company. Called the Gulf Papua Umbrella Joint Venture (GPUJV) Limited, it is the lead Landowner Company (Lanco) for six landowner groups, which are also represented by six companies under this Umbrella Company. Speaking at the official launching today in Port Moresby, the Member for Kikori and Minister for Provincial and Local Level Government Affairs, Soroi Eoe said the Lancos consist of landowner groups from the pipeline areas and the Petroleum Development License (PDL) landowners. The setup of the Lanco was done meticulously, having witnessed what had happened to some that popped up during the PNG LNG project. “We wanted to avoid that mistake. Landowners missed out during the construction phase,” said the Minister. The Minister, being a landowner himself, said this is a major achievement for the people of Gulf province. “Now landowners can participate in businesses from the Papua LNG.” The launch of the umbrella company is timely because the construction phase of the PLNG is expected to start next year and with the Lanco in place, the smaller companies under the umbrella company can be able to get contracts and participate in the construction phase, and with it, generate revenue for their landowner groups. Present to witness the official launching of the GPUJV were the Gulf Governor Sir Chris Haiveta, Member for Kerema Thoms Opa, Member Eoe and the landowner representatives of the groups.

The Kikori District Development Authority (KDDA) in the Gulf province, in its efforts to cut down on the cost of vehicle hires for its administrative duties, has opted to purchase new vehicles for its district offices. The KDDA recently purchased two new four-wheeled vehicles capable of handling the bush conditions in the district to get officers around to perform their duties. The two new vehicle purchased were specifically for the Treasury Team and the District Administrator. The district’s Acting Finance Manager, Ms. Helen Kavo thanked the KDDA Board for capturing the vehicles in the DDA’s assets registry budget component for the operation of the finance team. “Today marks the day for the end of external hire for KDDA Administrative costs,” said the Acting Finance Manager. Member for Kikori and Minister for Provincial and Local Level Government (LLG) Affairs, Soroi Eoe in a statement made it very clear that the two newly purchased vehicles are assets of the KDDA Board. He said that the purchase of these vehicles was a Board decision made to help enhance the performance of these officers and most importantly, cut down on high costs of vehicle hire. “In the past the Board had incurred huge costs for vehicle hire in order for officers to perform their tasks,”said Mr. Eoe. “With these assets now acquired for administrative duties, focus can now be given to look into other important areas of service delivery.” Mr. Eoe also sternly warned officers that as caretakers of these assets, care must be given and vehicles must be used purposely for official duties.

Local businesses in the Micro, Small and Medium Enterprise (MSME) sector will continue to be supported and represented at the government level into to the future, through the MSME Council of Papua New Guinea (PNG). That was the assurance from the Founder of the MSME Council, Mr. James Gore, at a recent Council event held in the city of Port Moresby this month. Mr. Gore said the Council plays an important role as the link between the government and the micro and small businesses in terms of policy and support for the MSME sector. He said prior to the establishment of the Council four years ago in 2019 through a ministerial approval by the then Minister for Trade, Commerce and Industry, the late Wera Mori, the government engagements with the business sector were only focused on big companies or corporations in terms of State and private sector dealings and support. “For the rest of us (MSMEs), we didn't have a say in terms of trying to influence government policies. We didn’t have a seat at the table when the government wants to engage with businesses,” said Mr. Gore. “But now, we have government recognition, we have a seat at the table when it comes to business dealings with government and the government now has time to listen to us. So, in that way we can try to influence, rather than not having a say.” Mr. Gore said the aim of the MSME Council is to advocate creating an enabling environment for the MSME sector, like access to finance for the micro and small business operators to enable them to grow and expand their businesses. A testament to this was the MSME council’s idea put forth to the prime minister for the K200 million annual MSME funding and Credit Guarantee Corporation, which was launched in March 2022. This enabled a lot of micro and small businesses access to finance, helping their growth or start- up. Mr. Gore said their existence is to serve its members in the sector and after four years of operation, the MSME Council looks to the future and will continue to work with the local businesses and the government to create better enabling environment for them to grow in this sector, and with it, grow the economy of PNG as well.

The construction work on a new Level 4 District Hospital for the Yangoru- Sausia District in the East Sepik province is expected to start next year. This was announced just recently by the Member for Yangoru-Saussia and Minister for International Trade and Investment, Richard Maru, following a visit by the Provincial Health Authority (PHA) Chief Executive Officer (CEO), Mr. Matthew Kaluvia and his management team to see the proposed site. The first phase of the construction of the Level 4 District Hospital will commence after designs are completed and tenders are called and awarded by the East Sepik Provincial Health Authority. “The Yangoru-Saussia District Hospital will not only serve our District but travelers along the Sepik Highway and the people of Middle Sepik when the road is connected from Yekimbole to Yenchen in the Sepik River of the Wosera-Gawi District. Our people of Middle Sepik will only be an hour away from Yangoru when the road to connect Yenchen is completed,” said the Member. “Our people look forward to finally having our own District Hospital with facilities like an accident and emergency section, x-ray and scanning facilities, blood bank, minor operating theatre, dental facilities, and a mortuary including over 32 new staff houses.” Maru further stated he is working very closely with the Minister for Health, the National Department of Health (NDOH), and the East Sepik PHA to deliver this important project for a better and improved health services in the district. The Member later thanked CEO Kaluvia and his management team for visiting the proposed location of the hospital in Yangoru and for also attending the District Development Authority (DDA) Board Meeting to update them on the development of the District Hospital.

PNG Power Limited (PPL) has given its assurance to its customers throughout the country that electricity services will not be affected this festive season as people celebrated Christmas and New Year. The Acting Chief Executive Officer of the State-owned power company, Mr. Nehemaiah Naris in a statement said that all their operations teams throughout the country are working this holiday season to ensure that the power supply is maintained and that any unplanned outages that occur will be attended to as quickly and safely as possible and restored within a short turnaround time. “Christmas is a time for all families to spend together at home and reflect on the journey in 2023, and we, the PNG Power team, will ensure that everyone enjoys this period with minimal power interruption,” said the Acting CEO. “If there are any power outages during this time, we will ensure that vital information on these outages will be communicated to all our customers in real-time through our social media platform.” In regard to the outstanding electricity bills owed by the Government, Mr. Naris said PNG Power is working closely with the Treasury and Finance departments to resolve this matter amicably. “There’s positive feedback from these two government agencies, and PPL remains hopeful that our bills will be paid. We also want to thank the Marape Rosso Government for funding major capital projects in 2023, including the recently completed 132kV transmission lines and the Moitaka substation, which enabled electricity to be carried from the new Edevu Hydro into the Port Moresby Grid.” He said this government intervention through Kumul Consolidated Holdings (KCH) has directly improved reliability in the Port Moresby Grid. “We are also further encouraged by the Marape Rosso Government’s funding of K211m in the 2023 supplementary budget, which enabled us to carry out critical maintenance and rehabilitation works on our Port Moresby Grid,” Mr. Naris added. “We want to reiterate again to our customers and people across the country that PNG Power Ltd, as your sole power company, will continue to provide electricity services this festive season.”

The MSME Council of Papua New Guinea (PNG) is looking to roll out its 2024 annual plan, which will include working together with key partners like the Center for Excellence in Financial Inclusion (CEFI) for its Trainer of Trainers program to support its financial literacy programs. The Council’s Executive Director, Ms. Yolanda Bafmatuk said that in the initial discussions they were able to discuss with CEFI and come up with four different trainings, one for each of the four quarters of the year, to cover for the Small and Medium Enterprises (SMEs). “Apart from that we are keen on also reaching out to see these sort of programs running in other centers,” said Ms. Bafmatuk. “It won’t be the same, we have to tailor our programs to suit the different environments that are out there.” She explained that this is a campaign for SMEs to be self-sufficient and to support each other to excel and be successful. Despite the challenges that the SMEs face, she encouraged all the SMEs that the MSME Council will try to do its best to support them in their progress. Meanwhile, the MSME Council Founder, Mr. James Gore said that the existence of the Council is to give the micro, small and medium businesses a voice at the government level, so to bring across concerns and also influence policies for SMEs. “The aim of the MSME Council is to advocate, to create an enabling environment for the SME Sector,” Mr. Gore further stressed. The MSME Council was established in 2019 after a Ministerial Approval and in four years, it has become a critical platform to support the SME sector in the country.

The country will see a slight increase in both loans and grants next year as support coming in from Papua New Guinea’s (PNG) development partners towards funding the 2024 National Budget. The total of grants and loans for 2024 amount to K3, 418.8 million, which comprises of K1, 213.8 million in loans and K2, 205 million in grants. The 2024 grants increase 8% from 2023 total in grants and loans increase 4% from 2023 total in loans. According to the country’s Treasurer, Mr. Ian Ling Stuckey, the total loans and grants account for 32% of the Capital Expenditure Budget of K10.7 billion. “Grants and loans play a significant role in supporting infrastructure developments in the Transport, Health, Education, Law and Justice Sectors, provided technical assistance and capacity building in climate and environmental initiatives and addressing cross cutting issues,” said the Treasurer. “The recently launched MTDP IV requires development partners to align their assistance programs and projects with the 12 SPAs and 71 DIPs outlined in the plan.” The development partners include PNG’s bilateral and multilateral partners, international NGOs, regional Organisations, private sector foundations and climate finances. The MTDP IV presents financing options for development cooperation support over the next four years. “The Marape-Rosso Government is committed to support ongoing policy priorities to achieve national prosperity and promote economic growth.” This assistance from development cooperation, is sought to support the economy, improve economic and social indicators, and invest in strategic areas such as economic development, infrastructure, human capital, governance, service delivery, foreign direct investment, and partnerships. Meanwhile, the Government of Australia, through the Department of Foreign Affairs and Trade (DFAT), is the largest contributor, providing grants totalling K1, 196.2 million. Other Development Partners providing grants in 2024 include the European Union (EU), United Nations System (UNS), Japan International Cooperation Agency (JICA), People's Republic of China (PRC), and New Zealand Aid (NZAID). In terms of loans, the People's Republic of China (PRC) is the largest bilateral loan financier for PNG in 2024, followed by the World Bank (WB), Asian Development Bank (ADB), and Japan. Other financiers include DFAT-Australia, the International Fund for Agricultural Development (IFAD), and the Korean Export-Import Bank (Korean EXIMB). PNG will also be looking to source funding from Asian Infrastructure Investment Bank during 2024.

The Internal Revenue Commission (IRC) of Papua New Guinea (PNG) in its endeavor to enable ease in tax payments and increase tax collection, has put in measures to improve all that and one of such is the Tax Portal (myIRC), which taxpayers and tax agents are encouraged to fully utilize. Ms. Ketty Masu, the Director of Taxpayer Services and Policy Division who spoke at the recent annual Tax Agent Liaison Group Meeting in Port Moresby, said the tax portal is a new way of communication between taxpayers, tax agents and the IRC. “It’s a good channel of communication, with this channel we can have an oversight of what’s coming in, when its coming, because we get a weekly report and if there are things that are outstanding, we follow up on that,” said Ms. Masu. “Benefits for you as tax agents, you make your payment at ease, submit and manage your lodgments online.” The IRC was also credited for the record 2024 National Budget total, mainly due to the improvements made in tax collections from its measures employed, which led to increased tax revenue. As such, the more use of the online tax system, should see this further improved. Ms. Masu further encouraged those tax agents who have not registered yet, to start registering and enjoy the benefits of the online system. Registering for myIRC will enable agents to make instant online payments and interact with IRC services using smart phones, tablets or computers. She added that there are guides on the myIRC webpage with step- by- step instructions and guidelines that can be downloaded to assist those who are registering.

The long awaited restart of operations for the Porgera Mine in the Enga province is set to take place next week with the New Porgera Limited (NPL) announcing that the mine will reopen for business on the 22nd of December. NPL in a statement today stated that all legal and contractual conditions necessary for the reopening of Porgera Mine have now been met and the mine is set to officially restart operations, with the first gold expected to be poured in the first quarter of 2024. As Prime Minister (PM) James Marape noted in a speech today in Sydney at the 17th Papua New Guinea (PNG) Resources & Energy Investment Conference, the long road to Porgera’s reopening has reached the finish line. The result is an unprecedented partnership between PNG and two leading global mining companies, Barrick Gold Corporation (Barrick) and Zijin Mining, which for the first time gives majority ownership in a major resource project to Papua New Guinean shareholders. New Porgera will deliver unprecedented benefits to the people of PNG. Over the 20-year life of mine, PNG shareholders, which comprised of Porgera landowners, the Enga provincial government and the State, will receive 53% of Porgera’s overall economic benefits. The investors will share the remaining 47%. At an assumed gold price of US$1,800 per ounce, PNG shareholders can expect to receive nearly US$7.3 billion (approximately Kina 27.6 billion) over 20 years and US$2.8 billion (Kina 10.6 billion) in the first ten years. New Porgera Limited will be managed by Barrick (Niugini) Limited and employ more than 2, 300 people by June 2024 and over 3, 000 by the end of 2024.

The National Government has reduced the Log Export Tax in the 2024 National Budget to address concerns pertaining to the performance of the country’s forestry sector. According to the Treasurer, Mr. Ian Ling Stuckey, the State lifted the Log Export Tax in the 2023 Budget to a whopping 70% from the previous 50%, saying that the increase was to raise additional revenue to support the establishment of the Biodiversity and Climate Change Fund and to strengthen downstream processing policy of unprocessed logs. However, in the 2024 Budget, the Log Export Tax is expected to be reduced back to 50%. The reason being that the forestry sector has been experiencing low demand in export market for logs during the year, the bad weather affecting production and the current unfavorable taxation regime. “After close consultation with the forestry sector on the impact of the current log export tax, it was agreed to introduce a regime which is lower than the current log export tax regime,” stated the Treasurer. “It was suggested that the current regime provides an unfriendly business environment to support the logging industry to go down the path of downstream processing.” Therefore, implementing the regime will allow the forestry sector to plan and develop capacity for downstream processing in consistent with the government’s objective to ban export of unprocessed logs by 2025; hence, focusing on downstream processing. This new measure will come into effective on the 01st of January 2024.