Wednesday, June 23, 2010

Government to release LNG seed money

K120m grants to landowner firms in 10 trust accounts this week: Kapris


THE long-awaited business development grants (BDG) for the PNG liquefied natural gas (LNG) project areas will be deposited into the recipients’ respective trust accounts this week, The National reports.

Ten trust accounts have   already been opened based on the petroleum development licence (PDL) areas and a total of K120 million BDG, or seed capital, will be apportioned and paid directly into the trust accounts according to breakdown as per licenced-based benefits sharing agreements.

Commerce and Industry Minister Gabriel Kapris announced yesterday the K120 million was solely for landowner companies from the 10 PDL areas to help them use it as seed capital to participate in the early construction phase until the full-scale construction stage of the LNG project

“These funds are seed capital,” Kapris told reporters at a press conference.

“Seed capital means for landowner companies to grow and venture into multi-corporate companies.

“It must be made clear the seed capital funds are not for the landowners to offset their debts accumulated in Port Moresby from hires cars, hotel bills and other bills.

“They can do so with other memorandum of agreement funds but with BDG, it is solely for them to meaningfully participate in the construction phase of the project,” Kapris stressed.

“My department wants to see the K120 million grow and I would expect to see landowners coming back to me with smiles on their faces and appreciate me for the strictly guiding them for the use of the BDG and not to hear some landowners started some companies but deregistered or declared bankrupt.

“I want to see landowners from remote Juha, Gobe and Kikori businessmen prosper through the K120 million seed capital.” Kapris said.

Department decretary Aton Kulit said the K120 million seed capital was a one-off payment and it would be wise for the respective nominated landowner umbrella companies to use the funds wisely and make good returns out of it to survive in the competitive business environment.

He said not all landowners would be paid their BDG.

There are outstanding in-house issues within some landowner companies which have to be resolved before funds could be released.

“Only those landowner companies that have completed their process without any hassle would see their funds paid into their trust account monitored by my department,” Kulit said.

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