Economy. Papua New Guinea press review
Prime Minister of Papua New Guinea Hon. James Marape announced that intensive negotiations between the State Negotiation Team and Twinza Oil Limited (Australia) for the development of Papua New Guinea’s first offshore development project, the Pasca Offshore Petroleum Project, has concluded. Under the terms agreed, the State will achieve between 61% and 65% of economic benefits, including early revenue, access to LPG (liquefied petroleum gas) discounted by 30% for national consumption, fixed revenue to the State through agreed taxation arrangements and other provincial and direct economic benefits. [1-2]
According to PNG Prime Minister, a final investment decision (FID) is targeted for the end of 2021, with production to commence in 2024. Pasca Petroleum Project is situated in the gulf, some 95 kilometers from the Gulf Province coastline and 265 km west of Port Moresby. [3]
At the same time, Mr. Marape noted that the National Government will continue to make additional concessions for an acceptable pathway to all parties to get the US$9.2 billion P’nyang Gas Project off the ground. Prime Minister Hon. James Marape said that he has written to the ExxonMobil chairman and chief executive officer Darren Wood. «The chairman has responded positively, indicating that they understand the position of the government and that they will respond after their consultations with other joint venture partners have concluded, » Mr. Marape said. The P’nyang gas project is located in Western and currently owned by ExxonMobil and Oil Search Limited. It is expected to generate a (pre-tax) cashflow of US$23.3 billion over a period of 20 years. [4]
However, PNG Prime Minister has warned commercial banks planning to leave the country that they may not be allowed to return. «I know Westpac and ANZ are discussing an exit you might regret». In turn, Mr. Marape thanked Bank South Pacific «for your acclimatisation to the need of PNG». Prime Minister also thanked the Kina Bank which last year acquired ANZ’s retail and commercial banking business. [5]
Commerce and Industry Minister William Duma has called on the Bank of Papua New Guinea (BPNG) and the Independent Consumer and Competition Commission (ICCC) to reject any application by Westpac to sell its business to a commercial bank in PNG. Mr. Duma also urged the two state agencies not to approve any application by a bank to acquire the assets of Westpac because it would reduce competition in the banking sector. Mr. Duma was responding to media reports in Fiji that Westpac was close to selling its Pacific banking operations. The Minister echoed the views of Prime Minister James Marape who warned Westpac and ANZ not to close their operations and leave PNG because they might not be allowed back in. Mr. Duma has also blamed the two banks of failing to invest in training locals and improving their infrastructure. A number of oil companies had left PNG in the 1990s but returned in the mid-2000 when the PNG economy had improved. Commerce and Industry Minister said this should not be repeated in the banking sector. [6-7]
In turn, ANZ has reaffirmed its commitment to maintaining institutional and corporate banking operations in PNG. [8]
Westpac also says its PNG customers can be assured that it is here to serve the country through various support systems. [9]
However, Kina Bank has not considered acquiring Westpac Group’s banking operations in the Pacific, according to chief executive officer Greg Pawson. [10]
More than 500 businesses in Porgera (Enga Province) have lost about PGK24 million (US$6,79 million) over the last four months due to the suspension of the Porgera gold mine and want the Government’s decision to control the mine to be fast tracked for business resumption, as said Porgera Chamber of Commerce and Industry president Nickson Pakea. [11]
[1] https://kalangfm.com/news/state-secures-landmark-and-historical-terms-for-new-offshore-petroleum-project-1002
[2] https://www.thenational.com.pg/marape-hails-outcome-of-talks/
[3] https://postcourier.com.pg/gulf-off-shore-project-coming-soon-says-pm/
[4] https://postcourier.com.pg/marape-certain-pnyang-gas-project-will-get-off-the-ground/
[5] https://www.thenational.com.pg/commercial-banks-warned-against-leaving-pngs-shores/
[6] https://www.thenational.com.pg/minister-urges-state-agencies-to-reject-sale-application/
[7] https://postcourier.com.pg/duma-do-not-allow-banking-monopoly/
[8] https://postcourier.com.pg/anz-reaffirms-commitment-to-png/
[9] https://www.thenational.com.pg/westpac-here-to-stay-official/
[10] https://www.thenational.com.pg/bank-yet-to-consider-acquisition/
[11] https://www.thenational.com.pg/mines-closure-costing-businesses-about-k24mil/
