Provinces yet to get dues from LNG shipments

THE PNG LNG Project has made more than 500 LNG shipments but the beneficiary provincial governments are yet to receive their dues, Hela Governor Philip Undialu says.
Undialu, who has been speaking about the government’s unfair treatment to provincial governments and landowners concerning the PNG LNG project, said the project made K150 million per shipment.
“One of the reasons why myself and two Hela MPs – James Marape and Manase Makiba – left the government led by Prime Minister Peter O’Neill, was the total failure and lie by the prime minister during his 2017 election promise to transfer the 4.27 per cent Kroton Equity to the landowners free of charge,” he said.
Undialu said Kumul Petroleum Holdings Ltd earned around K1.8 billion annually from the 16.4 per cent share from the PNG LNG Project, of which 4.27 per cent belonged to the landowners and five per cent for the provincial governments of Hela, Southern Highlands, Western, Gulf and Central.
“From 2014 since the first LNG shipment was done to 2019, we the landowners and the four provincial governments stand to around K2.7 billion,” he said.
“That is K450 million per year for the last six years from 2014 to 2019.”
Undialu said the 4.27 per cent Kroton Equity shares was unable to be transferred because the prime minister has mortgaged the shares with the K3 billion UBS loan.
“Worse still, O’Neill has nominated KPHL as a guarantor for Papua LNG,” he said.
“Before our 4.27 per cent equity is tied to another loan, I call on the prime minister to release it.”
Undialu said the UBS loan deal done by O’Neill has seen the people and the country losing around US$1.2 billion (K4.05 bil) and 10.1 per cent Oil Search shares.
“The PNGLNG has already made K75 billion,” he said.
The US$19 billion (K64.09 bil)project is an integrated development that includes gas production and processing facilities that extends from Hela, Southern Highlands, Western and Gulf to Port Moresby.
ExxonMobil PNG Ltd operates the project on behalf of five co-venture partners.
LNG production began in April 2014.
Since then we have been reliably supplying LNG to four long-term major customers in the Asia region.