PETROMIN NEWS
ELK/ANTELOPE PROJECT SIGNING
Statement by the Managing Director of Petromin
Firstly, I would like to congratulate the State and InterOil for successfully executing the Project Agreement which paves the way for the second LNG project for Papua New Guinea.
I was first associated with the Project Agreement in my remaining days as Chief Secretary to Government in early 2007. I chaired the first meeting on the first draft in Cairns. That first draft has gone through a number of drafts, culminating to the final draft over a period of about three years which was approved a week ago by NEC. The approved document is therefore the most researched and thoroughly debated document, at least in my past entire public service experience in project negotiation.
So let me thank those on both sides of the table; from Phil Mulacek, Christian Vinson of InterOil, their lawyers as well as the Minister for Petroleum, the Acting Chief Secretary, Secretary for Treasury, Secretary for Petroleum and Energy, the State Solicitor, my staff from Petromin and of course Mr. Henry Leia of the Gas Facilitation Office for making this possible.
But above all, I would like to pay special tribute to the Prime Minister, Rt. Hon. Grand Chief Sir Michael Somare. Without his vision and dedication, we would not have any LNG project at all.
I had the honour of working for the Prime Minister as both Head of the Department of Prime Minister and NEC as well as Chief Secretary to Government for five years. Apart from the general inspiration and encouragement he gave me, I was able to learn from him, through observation, the skills of inter-personnel relations, negotiations, general diplomacy and visionary leadership.
The Grand Chief, in one of his visionary conversation, told me that he would like to set up a national vehicle company that would hold the State’s equity as well as involve in exploration and development in the minerals and petroleum sector.
His vision was realised when Parliament created Petromin in early 2007 by enacting the Petromin PNG Holdings Limited Authorisation Act.
This vision did not stop there. In fact in one of his brain storming sessions, he instructed me to work with InterOil to facilitate an LNG project, after witnessing the flaring of Elk 1 well. I can clearly remember his instructions. He said work with InterOil because I have confidence in Phil Mulacek that he will find the gas resource to deliver an LNG project.
I want to leave behind an LNG project for Papua New Guineans before I retire from politics, he said. I promised him to take up the challenge.
Prime Minister, your dream of having an LNG project for your people have now doubled. You are not leaving behind one LNG project when you retire from politics but two projects.
The signing ceremony today marks the culmination of your dreams where Papua New Guineans are to fully participate in the development of their resources. The Elk/Antelope project has true PNG colours. Not only the State Nominee company Petromin will have a bigger stake in equity but it gives Papua New Guineans greater opportunity to plan, design and implement an LNG project as well.
Prime Minister, I can understand the excitement you have today, in your capacity both as Prime Minister and Minister responsible for the State Nominee, Petromin.
The second LNG project brings more value adding opportunities to Papua New Guineans and you can claim it to be a truly Papua New Guinean project, majority owned by truly Papua New Guinea based companies.
The project has provisions for Domestic Market Obligations for third party access. Therefore, the Elk/Antelope LNG project will give more value in terms of downstream processing businesses such as power generation and petrochemical industries.
It also provides opportunities for Petromin to participate in the full chain of the petroleum business, including shipping, gas based industries and marketing.
In conclusion, let me once again congratulate you, the Minister for Petroleum, Honourable William Duma, the State Negotiating team, the Gas Facilitation Office, the executive Government and InterOil for the successful execution of the Project Agreement. For Petromin, we will be working with the project partners to facilitate our entry into the project and to ensure that the project partners deliver the project on time.
Together with the project partners, Petromin will be seeking the support of our political leaders lead by yourself as Minister responsible for Petromin and the Minister for Petroleum and Energy, the executive Government and the respective State entities to realise this project.
Joshua R. Kalinoe, CSM, CBE
23rd December 2009
Port Moresby
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