Secure deals imperative: Kua

PETROLEUM Minister Kerenga Kua says it is imperative on him as minister responsible to secure better deals for the country.
Kua made the statement in response to Twinza Oil Ltd’s comments on Government’s demand to increase the levy fee for the Pasca A gas project off Gulf.
Kua said while he understood the developer’s concerns regarding the signing of the Pasca A agreement, it was the prerogative of the Government to seek better terms.
“Until the signing takes place the window for negotiations is still open,” he said.
“As minister, it is imperative on me to seek the best outcome for PNG as per my letter to Twinza on Feb 4.”
According to a statement from Twinza this week, the Government informed the company on April 16 that it now required a six per cent production levy in order to sign the agreement.
“This is four per cent higher than the production levy that was agreed as part of the comprehensive terms for Pasca A, negotiated by the State negotiating team and announced by Prime Minister James Marape, last Sept 24,” the statement said.
“The additional levy which has been requested would make the Pasca A project unfinanceable for any investor.”
According to Twinza, the State had also formally sought to change the agreed terms via a letter from Kua on Feb 4.
“The Government’s demand to raise fiscal take to 55-60 per cent nominal share, which is 75-85 per cent of the actual project value, would make Pasca A unviable for investors and financiers alike.
“Notwithstanding the changing State positions, Twinza remains committed to PNG and progressing the Pasca A project on the agreed terms.
“In an effort to close-out the agreement, Twinza has offered an additional concession to the agreed terms, to increase the production levy to four per cent, with a further increase to six per cent at higher oil prices.” However, Kua said he understood that Twinza negotiations had taken several months to reach this point and that the company had invested heavily in time and resources.
“But given the uniqueness of the project relative to other existing oil and gas projects in the country, it would be negligent for the State not to demand more benefits from this deal,” he said.
“The door remains open and the State is ready to review talks with the company at any time.”