Review of LNG grants sought

Source: The National, Tuesday, February 12, 2013

By MALUM NALU

PAYMENTS of business development grants (BDGs) to LNG project landowners in Angore, Hela, have been put on hold until a review into use of all past grants is completed.
This was announced by Trade, Commerce and Industry Minister Richard Maru yesterday after concerns about how these grants – running into millions of kina – have been used since the signing of the Kokopo umbrella benefits sharing agreement (UBSA) in 2009.
Of a total government appropriation of K120 million – dished out to licenced areas in Hela, Western and Central – about K106 million has already been spent, with K14 million left.
Of this, K12 million is yet to be paid to Angore petroleum development licence (PDL) 8 landowners.
National Executive Council (NEC) appropriation of BDGs for all licences areas include: LNG plant site Portion 152 (K17 million), LNG pipeline area (K16 million), Hides PDL 1 (K20 million, K700,000 remaining), Kutubu PDL 2 (K10 million, K1 million remaining), Gobe PDL 3 and 4 (K8 million), Moran PDL 5 (K6 million), Moran PDL 6 (K4 million), Hides PDL 7 (K15 million), Juha PDL 9 (K11 million) and Angore PDL 8 (K12 million yet to be paid).
Maru said millions of kina had been squandered, with nothing to show because there had not been any proactive and systematic processes put in place for effective and continuous monitoring.
“There are many allegations that BDGs have been used on pokies, etc, and not on starting businesses for impacted landowners,” Maru said.
“By law and by agreement, the nature of BDGs were not cash handouts, but were intended for business capital to empower local communities in the project impact areas.
“There will be a freeze on all payments of the BDGs until the review is complete and a new BDG policy is structured.”
Maru said the review would start after he undertook a visit to the impacted areas to verify with landowners if grants given to them were used for their intended purposes.
He and chief secretary Manasupe Zurenuoc will lead a government delegation to these impacted areas.
Maru said the prime minister fully backed his moves to conduct the review and all Hela MPs would be asked to join the government review team.
“We must go and meet with the impacted landowners, get firsthand what the issues are and incorporate both landowner views and positions before we work out the way forward,” he said.
“This would be a major exercise involving the strengthening of the local content mechanisms on the ground and the relevant agencies of state.
“I am concerned that so far, there are no systems to ensure that public funds were used for spin-off businesses that will directly benefit impacted communities today and beyond the life of the project.”