Competition Commission concerned about possible monopoly in gas sector, O’Neill to issue statement on government shareholding in Bougainville Copper and ANZ Bank CEO says there may be a need for a Supplementary Budget. Your weekly digest of the latest business news.
The acquisition of InterOil by ExxonMobil Corporation may raise competition issues, the CEO of the Independent Consumer and Competition Commission, Paulus Ain has told The National. ExxonMobil has announced it would pay US$2.5 billion (K7.65 billion) for InterOil, after Oil Search withdrew from a potential bidding war. ExxonMobil is the leading joint venture partner and the operator of the PNG LNG project. ‘If this proposed acquisition proceeds, it will give ExxonMobil about a 36 per cent stake in the Papua LNG project and other potential LNG projects in the acreages that lnterOil has licence to,’ he reportedly said.
***
Prime Minister Peter O’Neill has told PNG Loop he will issue a major statement next week about the government’s shareholding in Bougainville Copper Ltd., LNG shares and Western Province Ok Tedi shares, after the government was given an extra 17.4 per cent of BCL by Rio Tinto, after the London-based miner walked away from the mining operation.
***
ANZ’s Mark Baker
ANZ Bank‘s PNG CEO Mark Baker has told The National there is a need for a supplementary budget to the 2016 budget, because revenue had remained below what the Government had forecast in the first quarter. Meanwhile, the Institute of National Affairs’ Executive Director Paul Barker says there are some encouraging economic trends, including stronger gold prices, improved oil and gas prices and the re-commencement of Ok Tedi mine. He says cocoa prices remain firm, and coffee prices have improved.
***
Prime Minister Peter O’Neill has survived a vote of no confidence in Parliament, with the support of 85 parliamentarians. Twenty-one MPs voted in favour of the motion.
***
South Pacific Resources (SPR) has raised A$1.12million (K2.65 million) to advance its oil and gas interests in Papua New Guinea. SPR holds five prospecting licences in PNG. Two are located onshore, two offshore in the Papuan Basin, and one in Cape Vogel Basin.
***
Newcrest’s Sandeep Biswas
‘A solid performance’, is how Newcrest Mining’s CEO, Sandeep Biswas, described the company’s year to June report. The gold and copper miner reported a 0.7 per cent increase in gold output to 2.4 million ounces over the financial year, but copper production decreased 14.2 per cent for the year. Net debt reduced 27 per cent over the year to US$2.1 billion (K6.67 billion).
***
Mineral exploration activity plunged from a peak of K944.34 million in 2011 to K325.5 million in 2015 after hitting a low of K256.2 million in 2014, according to a survey conducted by the PNG Chamber of Mines and Petroleum. Total exploration spending in 2016 is likely to drop from last year’s level although it is still too early to say if it will decline below the 2014 level.
***
Westpac Bank has called for nominations for the 2016 Westpac Outstanding Women awards. Award categories include private sector, public sector, not-for-profit, entrepreneur, community and young achiever.
***
The ANU’s Matthew Dornan
Speakers at the Pacific Update conference have painted a rosy picture of the Fijian economy, with 2016 expected to be the country’s seventh consecutive year of economic growth. They say the greatest challenge for Fiji is in agriculture. The fall in the price that Fiji receives for its sugar will adversely affect the agricultural sector in the years ahead, according to Matthew Dornan, Deputy Director of the Australian National University’s Development Policy Centre.
***
Air Niugini Chief Executive Officer, Simon Foo, announced an increase in the number of flights to and from the Australian cities of Cairns, Brisbane and Sydney, effective from October 30. Foo said the flight increase, which is subject to regulatory approval, has been made possible following recent variations to the Air Niugini and Qantas Code Share Agreement. The airline will also start operations to the Federated States of Micronesia (FSM) in September, coinciding with a meeting of Pacific Leaders, organised by South Pacific Forum. Air Niugini will start initially with three special flights to Chuuk and Pohnpei , two of the four states in FSM.
***
And finally, Guardian Australia reports an Australian man has won his own remote Pacific island resort in a raffle after shelling out just US$49 for the winning ticket to claim the paradise property. The man, identified only as Joshua from New South Wales, won the 16-room Micronesian resort in a draw organised by the Australian owners, who were looking to hand over the lodge after setting it up two decades ago. The resort is debt-free, profitable and has more than 20 years left on its lease.
USD 0.2840
AUD 0.3992
GBP 0.2294
EUR 0.2612
NZD 0.4374
JPY 36.91
SGD 0.3732
ExxonMobil’s bid to buy InterOil is well received by the Gas Resource Landowners of Triceratops – PRL 39. Yes,CEO of the Independent Consumer and Competition Commission (ICCC), Paulus Ain raises a concern on monopoly as reported in The National, but there is the question of tangible development reaching the resource communities. 40 years on Government has failed to deliver essential basic services of Health and Education, even income generating means to the Triceratops Gas Project Landowners who are yet to see or have a permanent building or infrastructure on ground.
ExxonMobil, a global Gas Developer has been the catalyst, contributing enormously in the Hides Project Resource Landowning, Condensate Processing Plant and Pipeline Communities. In the course of Developing Gas Resource, ExxonMobil brought in infrastructure for roads / bridges, Health, Education and promoted income generating activities for these landowners. Something that the Government would not have afforded at this time.
Triceratops Gas Project will do likewise for the surrounding communities on the fringes of Gulf, Morobe, Eastern Highlands, Simbu and Southern Highlands Provinces where Government services has never reached them. ExxonMobil bid to buy InterOil is highly commended by the Triceratops Gas Project Area Landowners – See’e Clan, U’a Clan, Serei Ose Clan and Obe Clan through their Landowner Association SUSO Landowner Association Inc. under the Chairmanship of Chief Keamonai Sonao.
If ICCC is so concerned, then should consider resource landowners need firstly and the Government’s rate of delivery of much needed infrastructure and services to the affected communities and track record of what ExxonMobil did in Hides PNG Gas Project, then perhaps support ExxonMobil bid by having guidelines for a guided monopoly in areas where ICCC views as threat. For example, Condensate Processing Plant and Gas product distributions be part of Triceratops Gas Project Area Landowner business interest with support from Kumul Petroleum Holdings Ltd.
All in all Triceratops Gas Project Landowners through its association SUSO Landowner Association Inc. welcomes ExxonMobil bid and looks forward to working with them.
by Bernard Kelontii – Consultant to SUSO Landowner Association Inc.