Tuesday, May 15, 2018

PNG LNG IMPACT QUERIED

OIL Search Limited has maintained its payments alongside joint venture partners in the PNG LNG project agreements to date.

Oil Search chairman Rick Lee pointed this out in response to concerns raised by shareholding organisation the Australasian Centre for Corporate Responsibility (ACCR) executive director Brynn O’Brien during Oil Search’s annual general meeting held last week.

Ms O’Brien questioned the board on the second report on the LNG project released last Friday titled ‘On Shaky Ground’ by the Jubilee Australia research centre on the social impacts that have plagued the resource areas since the flow of gas in 2014, in relation to royalty payment, infrastructure project, and poverty in affected community areas.

“Again I think it is tied up in much the same area where the government has certainly made commitments and those commitments were made to the different landowner groups and clearly the lack of distribution and the lack of payment by the joint venture into the appropriate bodies is the cause of it and those are being worked on very actively,” Mr Lee said.

“Clearly everyone has an objective in trying to ensure that these issues are resolved. As far as Oil Search is concerned, outside of the benefit arrangements we have done I think a significant amount to help support and serve the communities around those licence areas around our own operations and I think the earthquake relief was a very good example of that.”

Managing director of Oil Search Peter Botten also mentioned K708 million is currently held in trust awaiting completion of landowner identification.

“More than K14 billion from the project, K3.9 billion paid to the State and landowner entities in royalties, development levies and equity payments, taxation and employer contributions add to this figure.

“At the moment some K708 million is held in trust waiting final landowner identification determination,” he said.

“Various government entities are working hard to complete the final part of this important process, with 12 of the 15 licences either receiving or close to receiving benefits,” Mr Botten said.

He said the landowner identification process under the Act, including verification, has been completed in many areas awaiting final ministerial determination whilst three remain subject to resolution for various court orders.

“Payment structures for benefit distribution are in place through final company board composition for each company requires confirmation.

“All parties see the importance of completing this process and we will continue to support communities and government in their efforts to resolve final issues,” Mr Botten added.

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