Friday, April 20, 2012

UPNG mourns passing of senior lecturer Dr Regis Stella

By KAIRU LAHO, UPNG Public Relations
On the eve of the launch of his latest book, Unfolding Petals: Readings in Modern PNG Literature, senior lecturer in Literature and English Communication at the University of Papua New Guinea, Dr Regis Stella passed away on Wednesday this week (April 18).

Dr Regis Stella
This book, his third, since his first novel Gutsini Posa (1999) and was set for launching today (Friday April 20) at the Waigani Campus.
Gutsini Posa in his local Banoni dialect means rough seas.
And this is how he and other PNG writers entered PNG’s literature scene.
His demise, however, was quite the opposite – quieter and most peaceful on the petals of his book.
Dr Stella was born in Bougainville.
He holds a PhD from the University of New South Wales and has been teaching at UPNG since he came on board as a teaching fellow in 1988.
According to his colleague and fellow writer Dr Steven Winduo, Dr Stella’s PhD thesis on re-emerging PNG through literary publications was one of the best ever written and had the rare opportunity to be converted to a book which is now a recommended text in universities.
He had been a deputy dean of the School of Humanities and Social Sciences and formerly the director of the Melanesian Institute of Arts and Communications (MIAC).
DrWinduo, described him as reserved but an intelligent person and hard working.
He had two titles to his name, prior to his most recent book and edited three others.
Dr Winduo wrote of his first novel which was launched at the University of South Pacific… “My colleague Dr Regis Stella, first wrote the novel Gutsini Posa (1999) for the National Literature Competition.
"He won a prize that year.
" Since then he has re-worked the manuscript through a writer’s fellowship at the University of Iowa writing school.
"The novel is centred around the Bougainville crisis and the experiences of that conflict.
" Far from its existential value, Gutsini Posa is a novel that has two achievements: First, it is an important literary representation of the struggle of the Bougainville people to come to terms with the crisis that had completely devastated their moral and physical strength.
"Dr Stella represents precisely this experience by the use of a volcano metaphor, a force mightier and devastating to both the oppressed and the oppressor.
"The relationship between human’s ability to destroy themselves and yet can also be destroyed by a force greater, in the form of natural disasters, is an inevitable reality that Dr Stella impresses upon the reader in Gutsini Posa."
Second, despite the differences in the characters of the book, they all have ideological strengths, which keep them intact from fragmentation
Dr Stella’s voice is stunning, yet controlled and provocative.
Though a first novel for Dr. Stella, he secures a new place in the literary culture of PNG.
Late Dr Stella journeys back home next Wednesday to his final resting place.

Lae port construction beings on May 8

Work will start on the Lae port on May 8 after a meeting held in Lae on Wednesday set the scene for construction work to start on the K700 million project.
The Lae port...a very significant project.-Picture by PETER BOYD of Riback Stevedores

Independent Public Business Corporation managing director Thomas Abe said the meeting was very successful and agreed on a number of important ground rules for construction.
“Clarification of a range of issues and commitments, including employing local workers, was achieved, allowing us to set the date for the start of construction,” he said.
“The start of this project, worth more than K700 million, is very significant.
“It will make a big contribution to the development of the Momase region, particularly in the resources, industrial and agricultural sectors.”
Present at the meeting were representatives of the executing agency (IPBC), contractor (China Harbour Engineering), and consultant engineers (Korean Engineering Consultant Corporation), Asian Development Bank, and PNG Ports Corporation Ltd.
The meeting was chaired by Mr Abe.
Construction work, expected to be completed in 2015, includes a tidal basin, a berth and a terminal.
Lae port is the most-important port in the country, and has become one of the busiest in the south-western Pacific as major resource projects start producing and construction of new ones begins.
It cannot meet current demand and would have become become an even greater obstacle to regional and national development without the project.
Abe said construction would create many hundreds of jobs and would provide work for local firms and sub-contractors.
“An important aspect of the pre-construction meeting was agreement by the contractor to try to maximise the use of local labor, local skills, local professionals and local companies and sub-contractors,” he said.
“This is something IPBC has been pushing very strongly, and I am happy to say that our position was viewed positively at the meeting.”

Thursday, April 19, 2012

Interoil: gigantic con or deadset bargain?

By  MICHAEL WEST of Sydney Morning Herald


The rope is stretched more tautly than ever in the tug-o-war between the true believers and the sceptics in tearaway oil stock Interoil.
For some, especially the short-sellers on its share register, Interoil appears a gigantic con. Look no further than its connections with colourful Vancouver stock promoter Carlo Civelli, they say, and its perennial penchant for over-promising and under-delivering.
For others, Interoil is deadset cheap. It claims to have discovered an "elephant", as they say in the industry parlance; a gas field called Antelope 1 with a flow rate of 382 million cubic feet of gas and 5000 barrels of condensate a day - a world record no less. And that's just Antelope 1. Antelope 2, they claim, is even bigger.
Internet chat forums lit up again a few weeks ago when George Soros lodged a notice showing he had been selling down. Soros is savvy. What could that mean?
Only Interoil knows. The real key to oil and gas plays, particularly in remote climes like PNG, is complex technical data. Yes, Interoil has drilled a couple of wells in the jungle and lit up a massive gas flare or two, but how long would it burn for? How much gas was really there and was it technically feasible to extract it?
Critical information about the likes of on-gas flow rates is known only to a few – but it means the difference between a multi-billion dollar project and an expensive hole in the jungle.
Such are the costs and the technical challenges of developing a major gas project that the PNG government has insisted Interoil – which has a market cap of $2.7 billion – team up with a multinational player to develop its project. To that end, Interoil boss Phil Mulacek has brought aboard UBS, Morgan Stanley and Macquarie as advisors to find this partner and the capital.
Besides the purportedly humungous gas field Interoil also promises to build an LNG plant to process the gas at a cost of $6 billion to $8 billion. It is one hell of a project to pull off.
The problem is … which project?
It has been a week of comedy and confusion in Papua New Guinea. Government officials have chided Interoil for trying to develop another project – a project not even “envisaged” by the contractual agreement which Interoil had signed with the PNG government in 2009.
Displaying a monumentally thick skin, Interoil announced on Tuesday that its Gulf LNG Project was “on schedule”. This was despite it failing to meet the deadline for Final Investment Decision (FID) approval for at least the third time.
The next day, however, the chairman of the government oil company Petromin, Brown Bai, publicly reminded Interoil that it had no contract to deliver the Gulf LNG project. The project for which Interoil had been approved happened to be situated in another part of the country.
“They cannot change the goal post and disregard their contractual obligations.
“I urge IOC and LNGL (Liquid Nuigini Gas Limited) to respect Papua New Guinea's laws, systems and processes, including accepting that the NEC has rejected the Gulf LNG project as proposed by them,” said Mr Bai.
The Prime Minister's office – despite a mysterious press release citing approval, but later retracted – had also rejected the Gulf project earlier this week.
Strangely – and this could only happen it PNG – the office of PM Peter O'Neill had issued a release confirming its support for the Gulf Project. Though it was quickly disavowed. Apparently, Interoil enjoys some high level contacts close to the Prime Minister.
The company will now have to find another excuse for not delivering on its contract. Its market commentary has continually emphasised the robust support it enjoyed from the government of PNG for the Gulf project – in stark contrast to the actual project agreement signed by Prime Minister O'Neill.
In an investor briefing last month, Interoil chief Phil Mulecek and his top brass again claimed government support for the Gulf project. It would proceed pending the clarification of a few minor matters, they told a conference call with analysts.
These details included the location of all the plant, an international proven operator partner with proven technology to joint venture in a 7.6mtpa LNG plant.
The government has insisted that Interoil find a big operator to develop its LNG facilities. Oil Search, for instance, is developing its $15 billion LNG project in PNG with oil giant Exxon.
BusinessDay understands that at least one major oil company which has sought admission to the Interoil data room to evaluate its gas project has been refused entry.
Interoil's sceptics believe the claims to a resource of 3 trillion cubic feet of gas are overblown. That's why, they say, the project remains undeveloped.
But the other leg to the project - the requirement to deliver a 7.6mtpa-10.6mtpa LNG facility based on its Elk and Antelope gas reserves - is required to be delivered using internationally recognized technology and operators.
LNG plants do not come cheaply.
Nonetheless, Interoil has been pushing ahead with its plan to build a 3mtpa LNG plant in the Gulf with Energy World Corporation (EWC), a company run out of Hong Kong but listed on the ASX.
EWC claims it has “modular” LNG technology which it can deploy to process the gas far more cheaply than existing plants run by the likes of Woodside, Chevron, BP and Exxon.
Its stock price though has been under pressure over the past two weeks after a story in BusinessDay highlighting its failure to deliver an LNG plant to Indonesia. EWC is yet to notify the ASX of its response to the latest demands from the PNG government and the government's insistence that Interoil sign up with an oil major.
The issue is material to investors. Since an LNG plant would cost, even on EWC's reckonings, many billion dollars, it would need to be funded. There is little guidance on how Interoil and EWC plan to fund their plant.
The Oil Search plant, at 2.5 million tonnes, is slated to cost $15 billion while InterOil claims its 2 million tonne plant will cost $6 billion to $8 billion.
Interoil has now extended the Final Investment Decision on its project agreement with EWC until December this year.
In the meantime, the market awaits with baited breath for Interoil, its joint venture partners such as EWC and its investment bankers Morgan Stanley, Macquarie and UBS (whose mandate is to find development partners) to clarify which project they are proceeding with – the one stipulated by their Project Agreement with the PNG government or another one.
mwest@fairfax-media.com.au
Read more: http://www.smh.com.au/business/interoil-gigantic-con-or-deadset-bargain-20120419-1x8y9.html#ixzz1sSLq71wU

Wednesday, April 18, 2012

InterOil provides Gulf LNG project update


InterOil Corporation reiterated its ongoing bid process to select an internationally recognised LNG operator to join the InterOil Gulf LNG project is on schedule, in a press release today.
The bid process is being led by investment banks, Morgan Stanley & Co LLC, Macquarie Capital (USA) Inc.and UBS AG.
The company is pleased with the process being conducted by the investment banks and the number of bidders involved in the process.
Selection of the preferred LNG operator is targeted for the second quarter of 2012.
The Project Agreement stipulates that FID be reached by June 2013 for the 7.6 million tonnes per annum Gulf LNG Project.
 The FEED packages for the project facilities are mostly completed.
"We understand the PNG Government's desire to have an internationally recognised LNG operator join the project and we trust that our LNG bid process will fully satisfy that requirement," said Phil Mulacek, InterOil's CEO.
 "We welcome the continued support of both the Prime Minister and the Minister for Petroleum who endorse an LNG project in the Gulf which complies with the LNG Project Agreement."

Lae chamber welcomes port project

By MALUM NALU

LAE Chamber of Commerce and Industry has welcomed the K700 million Lae port expansion and redevelopment project.
The contract, approved by the national executive council, has been awarded to China Harbor Engineering, the lowest bidder for the contract, worth K734, 343,882.
An aerial view of Lae port.-Picture by PETER BOYD of Riback Stevedores

The project is being funded 70% by the Asian Development Bank and 30% by the national government.
The NEC decision requires China Harbor Engineering Company to agree to have a significant proportion of national labour in its workforce and to employ PNG sub-contractors.
The main element of the project is the construction of new port facilities including a tidal basin, a berth and a terminal.
Work is expected to start in the middle of this year and finish towards the end of 2015.
"The tidal basin project is just about to start, which will see 250m more wharf space for Lae," Lae Chamber of Commerce and Industry president Alan McLay said.
"The current project, which is extending berth three, will add a further 140m to give Lae the chance of coping with the demand.
"Some of the dredged soil will also fill swampy areas, which will add to the port area, and hopefully be used wisely to decrease congestion.
"Without this development, Lae would be too hard to ship goods and shippers would look at other alternative ports."
McLay said Lae port had become the largest in the Pacific, due to the increase in imported goods mainly for manufacturing, but also for mining infrastructure.
"First the Porgera, then Lihir and now Morobe Mining Joint Ventures and Ramu, where Lae port brought in the construction and infrastructural materials," he said.
"Of course we see the port absolutely stretched to its limits by the infrastructural needs of the LNG project.
"There are always four or five ships anchored offshore, waiting for berth at the port.
"Shipping companies are now charging a 'congestion fee' to importers to try to recover some of the expenses caused by the delays whilst waiting for a berth.
"The imported goods experience further delays while customs clear the goods, which normally end up as storage charges.
"All of these extra costs are either consumed by the importer, or passed onto the customer and adds to the inflationary prices of goods."
Public Enterprises Minister Sir Mekere Morauta said this was a very significant contract for the nation, especially for the Momase-Highlands region.
"Lae port cannot meet current demand, and is becoming an impediment to the economic development of the region," he said earlier.
"Redevelopment and expansion of the port is urgently required so that many large regional projects, including the LNG project, can be built on time and at a competitive cost."

Alan McLay reelected as Lae chamber president


By MALUM NALU

Reelected Lae Chamber of Commerce and Industry president Alan McLay says expansion and consolidation of the manufacturing sector are among major developments in Lae over the years.
He rates continuous power blackouts and communication problems as among the major problems that have beset Lae.
McLay has been chamber president since 1995.
Alan McLay…concerned about power and communication problems in Lae

He is assisted by senior vice-president Nigel Merrick, junior vice-president Robert Howden, immediate past president Phil Franklin, treasurer Stephen Beach, and councilors  Kaity Bluett, Dennis Brewster, Terry Fuery, Ben Woo, Andrew Gunn, Peter Diezmann, Danny Kepi, Vanessa Chan-Pelgen, and Tony Wyatt.
MccLay said manufacturing was a feature of Lae.                                                         
“Up till the late 1980s, most products were imported in a finished form,” he said.
“They were warehoused in Lae and distributed to the markets, with over 70% to the Highlands.
“Hence, Lae had large wholesalers such as Sullivans, Associated Distributers, Steamships, Colins & Leahy, etc, which have all gone.
“Now most imported goods are components, which are then packaged or finished here in Lae by manufacturers.
“This means more investment in Lae, more employment and consolidation of businesses.”
Power and communication problems worry McLay.
“Lack of planning and installation of reliable back-up generators has left Lae short of good quality power,” he said.
“The aging generators at Yonki have become unreliable due to lack of serious maintenance over the years.
“Now the 78 megawatt output from the Yonki installation is insufficient to supply the network: Lae, Madang, Kainantu, Goroka, Kundiawa, Hagen, etc, as well as the new commitment to provide power for Hidden Valley.
“The Milfordhaven and Taraka power stations do not even provide half the city’s power needs, which means power has to be rationed in load shedding exercises when Yonki is down.
“The real bad thing about insufficient power is that the power is poor quality, with huge spikes and fluctuations, which causes damage to modern sensitive equipment.
“The private sector has had to armor itself against the constant outages and spikes, by installing costly standby generators, and power protection devices.
“I am waiting for PNG Power to brief me on their plans to construct what I believe will be a new 40 megawatt sub-station at Singaua and plans for a hydro scheme between Lae and Finschhafen.
“This will of course relieve the power problems.”
McLay said reliance on mountaintop repeater stations had caused communications outages over the years, which culminated in two weeks of near total communications blackout in January this year.
“With the decrease in tariff duties by customs, our manufacturers have to increasingly compete on the international market,” he said.
“With poor communications and power, how can we do that?
“Fortunately Telikom are running fibre optic cables on power pylons – first to Madang which will be finished by May.
“This will see Lae connected to the international gateway in Madang, and will be more than a back-up to the current system.
“We anxiously await this installation.”

InterOil accused of deviating from Gulf LNG project


By MALUM NALU

InterOil has been accused by state-owned Petromin of ‘staging’ the Gulf LNG project and not ‘delivering’ as per agreement with the government,
The controversial and much-delayed Gulf LNG project took a new twist yesterday (Tuesday) with state-owned Petromin PNG Holdings accusing InterOil and Liquid Niugini Gas Ltd (LNGL) of deviating from delivering the project.
This follows Prime Minister Peter O’Neill’s denial of releasing any statement in support of the project, following the release of a statement by one of his staffers, Susuve Laumaea last Friday to this effect.
The statement released by Laumaea, a former InterOil employee, said O’Neill supported the InterOil-led Gulf LNG project, which the prime minister has denied saying.
Prime Minister’s media advisor, Daniel Korimbao, told The National yesterday (Tuesday) that Laumaea might have misunderstood a conversation he had with O’Neill regarding the Gulf LNG project.
He said the government supported InterOil, however, did not support the company’s new development proposal or the continuous final investment decision (FID) deferrals.
“The government of Papua New Guinea recognises the license released to InterOil,” Korimbao said.
“The project has the full backing of the government.
“The government, however, does not support the new development proposal put forward by InterOil.”
Petromin chairman Brown Bai released a statement yesterday commending O’Neill for clarifying government’s position on development of the Elk and Antelope gas fields in Gulf province, as well as taking a swipe at InterOil and Liquid Niugini Gas.
“InterOil and Niugini Gas Ltd have deviated from delivering the project in the project agreement,” he said.
“They cannot change the goal post and disregard their contractual obligations.
“I urge InterOil and Liquid Niugini Gas to respect Papua New Guinea’s laws, systems and processes, including accepting that the National Executive Council has rejected the Gulf LNG project as proposed by them.
“InterOil and Liquid Niugini Gas should be working with the state to deliver the project in the project agreement.
“Now that the prime minister has clarified the position, Petromin is ready to work with the developer and the respective agencies of government, including the Department of Petroleum and Energy, to deliver the project in the project agreement.”
Bai said as the state nominee in the project, Petromin had invested over US$15 million in upstream exploration work and this investment had significantly contributed towards upgrading of the total gas resource in the license.
“The (Petromin) board approved this investment for the project, envisaged in the project agreement, and not for the staged ‘Gulf LNG Project’ as promoted by InterOil and Liquid Niugini Gas,” he said.
“The project agreement signed between InterOil/Liquid Niugini Gas and the state in 2009 is a binding contractual agreement and the parties are bound by this contract to deliver the project, according to the scope envisaged in the project agreement.
“The scope includes a large-scale 7.6 million tonnes per annum (MPTA) to 10.6 MPTA capacity plant operated by an internationally-recognised LNG operator.”