Minister seeks 'production sharing' arrangement

ATTORNEY General and Justice Minister Kerenga Kua reportedly said the government should review laws regarding its participation in petroleum and mining projects.
Minister seeks 'production sharing' arrangement Minister seeks 'production sharing' arrangement Minister seeks 'production sharing' arrangement Minister seeks 'production sharing' arrangement Minister seeks 'production sharing' arrangement

At a National Research Institute-backed forum last week, Kua reportedly discussed the difficulties the government faced in regards to meeting capital expenditure costs for resource projects it elected to take stakes in.

"Perhaps we should look at a production sharing arrangement where the state and other partners each get their own share of the final produce, like gold, oil and gas, to sell to at markets it is able to find," he said according to the Post-Courier.

The minister has reportedly blamed conditions set by the Asian Development Bank on state-owned enterprises for their poor performance.

"The cost runs into billions of kina with the LNG project [PNG LNG] and the state simply does not have that sort of money," he reportedly said.

"Our resource SOEs such as Petromin and Mineral Resources Development Company are co-developing the country's natural resources in partnership with the private sector but they are limited in how they can do this because of the restrictions imposed by many of the multilateral and bilateral donor agencies that are not even involved in the projects concerned."

Last year members of the previous government led by Prime Minister Peter O'Neill sparked fears with their proposals to amend mining and petroleum laws to give community-based landowners ownership of natural resources instead of the state.

But O'Neill stepped in and effectively halted this movement.

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