Then National, Tuesday 11th September, 2012
By MALUM NALU
ESSO Highlands managing director Peter Graham has expressed concern about the issue of resource ownership in Papua New Guinea, saying it is making investors nervous.
Graham was reacting to an item in The National yesterday regarding the growing resource nationalism among the people in many countries.
He told the Papua New Guinea Advantage 2012 investment conference in Port Moresby yesterday that such things made investors “nervous”.
Lawyer Hubert Namani told a mining industry gathering organised by the Mineral Resource Authority last Friday that it was only a matter of time before “resource nationalism” – a growing global trend – came to PNG.
The proposed amendment to the Mining Act was endorsed by three key figures – North Fly MP Boka Kondra, Central Bougainville MP James Miringtoro and former Western governor Dr Bob Danaya.
The proposal says resources belong to the people and not the state.
Lawyer Peter Donigi, the architect of this bill, argues that resources belong to the people and, therefore, investors are required to enter into contracts with the owner of the resource to extract the resource.
He said PNG had the lowest return at 22.5% for oil and gas and 30% for minerals.
“From an investment perspective, one of the things that strikes me is stability … uncertainty around investment must be remove,” Graham told the conference.
“Reading this morning’s paper, the issue of resource ownership has popped up: transfer of ownership of resources from state to landowners.
“The uncertainty of that is not going to do any constructive move to current investments in this country.
“It’s an issue that we’ve been given assurance by the new government that it’s not going to get legs and move on.
“I think investors around the country are wondering about the fiscal regime, the regulatory regime, the ownership regime.
“That’s the sort of thing that makes people nervous.”