Coffee growers get better deal

By AUGUSTINE DOMINIC
DISADVANTAGED and marginalised coffee farmers in PNG would now be served better under an agreement signed recently by the Coffee Industry Corporation (CIC) and Fairtrade Australia and New Zealand (FTANZ), The National reports.
Both parties agreed to work together to help farmers in developing sustainable coffee farming projects and seek international trade systems based on justice and fairness.

Morobe-based CIC mobile extension officer John Kabuba explaining coffee quality process to the remote farmers in Imani village in the Markham Valley

While signing the agreement at Lae International Hotel, CIC’s general manager for research and grower services Dr Mark Kenny expressed relief that a new path was being created for PNG coffee farmers to reach their full potential in coffee farming and trading.
He encouraged coffee farmers to join forces with CIC and other Fairtrade-certified coffee companies in PNG to benefit from the deals.
Programme manager FTANZ Maria J Trogolo said Fairtrade’s vision was of a world in which justice and sustainable development were at the heart of trade structures and practices so that everyone, through their work, could maintain a decent and dignified livelihood and develop their full potential.
“To achieve this vision, Fairtrade seeks to transform trading structures and practices in favour of the poor and disadvantaged,” Trogolo said.
“By facilitating trading partnerships based on equity and transparency, Fairtrade contributes to sustainable development for marginalised producers, workers and their communities.”
“Through demonstration of alternatives to conventional trade and other forms of advocacy, the Fairtrade movement empowers citizens to campaign for an international trade system based on justice and fairness.”
So far, one coffee farmer group, the Neknasi Coffee Cooperative, in Nawaeb district of Morobe province has received Fairtrade certification while eight other groups in the province are undergoing the certification process.
CIC’s provincial farmer training and extension coordinators from the Highlands and Momase regions were invited to witness the signing, which motivated them to connect their coffee farmer groups to Fairtrade certification

Batas market a hotspot for illegal trade

By MALUM NALU

THE notorious Batas market on the Indonesian side of the border with PNG in West Sepik province is fast becoming a multi-million kina hotspot for illicit goods.
The National visited Batas – fast becoming a mecca for PNG shoppers - at the weekend and saw pornography, sexual toys for both men and women, cigarettes, alcohol and various other items being sold at very cheap prices.

Batas Market…where the illicit trade into PNG from Indonesia begins.-Nationalpic by MALUM NALU

The government is missing out on millions of kina in excise duties because items can easily be carried across the PNG border without being checked.
A private intelligence source monitoring the illicit trade at the border, told The National that a highly-organised racket involving wealthy Highlands businessmen and local Wutung and West Sepik villagers in the trade of Indonesia-made cigarettes, existed.
A senior government officer told The National in Vanimo that the illicit trade was a serious threat to national security as guns, drugs and human trafficking could easily be carried out from Indonesia.
The intelligence source said the cigarettes were transported to Aitape near the border of East and West Sepik provinces, and then moved down to Wewak and then Madang for transport to the Highlands.
“It comes from the Batas Market, across the Wutung Border Post, and then comes out towards Vanimo,” he said.
“What the Highlands businessmen are doing is that they liaise with the local villagers and get them to carry Indonesian cigarettes across from Batas.
“They stockpile these cigarettes in the villages until they reach 20-30 cartons.
“These then come out from Wutung Village via boat or road to Aitape, transported by road to Wewak, then loaded onto ships or dinghies for Madang or Bogia, where they are picked up and transported by road to Mt Hagen, Minj or Banz.
“The concern is that these Indonesia cigarettes are brought in without paying any excise duty to the government, which is missing out on millions.”
The senior government officer said this was a very serious threat to national security which must be addressed immediately.
“All stakeholders including Customs, police and PNG defence Force must work together,” he said.
“I do not know what the Border Development Authority is doing.
“There are no patrol boats manning the maritime border with Indonesia.
“Cutoms officers at the Wutung Border Post are under-resourced and this is a very big concern.
“Apart from cigarettes, anything can be brought into PNG like firearms, drugs, anything.
“It’s a concern for the government and they have to address this at the national level.
“Smuggling is very big.”

PNGSDP buys 13% of Highlands Pacific

By MALUM NALU
THE PNG Sustainable Development Program, majority shareholder of the giant Ok Tedi mine, has subscribed 13.04% private share placement in Highlands Pacific for US$15 million, chief executive officer David Sode announced on Monday.
Highlands Pacific also announced on Monday that it had entered into a share placement agreement with PNGSDP, which invested US$15 million into Highlands.
The placement allows PNGSDP a seat on the Highlands Pacific board.
“The assets of Highlands Pacific represent good value at the agreed price,” Sode said.
“Two of the Highlands Pacific assets -- the Star Mountains exploration assets and the share of the Frieda River development property -- have potentially large synergies with the company’s interests in the future of Ok Tedi Mining Ltd, and in North Fly development.
“The synergies include the use of the North Fly power resources being developed by PNG Energy Developments Ltd (PNGSDP’s joint venture with Origin Energy Ltd), the use of the education and training facilities of the Star Mountains Institute of Technology in Tabubil, and the use of town facilities in Tabubil.“The effective use of these synergies will materially assist the Star Mountains and Frieda River mining developments, and enhance PNGSDP’s development interests in the North Fly.
“PNGSDP looks forward to working with Highlands Pacific to advance the shared interests of the two companies.”
Managing director of Highlands Pacific John Gooding said on Monday: “As stated the other day the relationship with PNGSDP has the potential to deliver significant benefits to Highlands, giving it the financial and technical backing of a very large investment company that has strong ties in Papua New Guinea and is the majority shareholder of Ok Tedi Mining Ltd.”
Highlands Pacific said under the agreement, PNGSDP would subscribe for 102,930,373 fully paid ordinary shares to raise US$15 million (A$14.9 million equivalent), which results in an issue price of approximately A$0.145 per share.
Upon completion of the placement, Highlands Pacific will have approximately US$23 million in cash reserves and will be well placed to continue its exploration programme at Star Mountains for the next 18-24 months.
As part of the agreement, Highlands will appoint a PNGSDP nominee to the Highlands’ board of directors.
The placement will be undertaken by Highlands under its 15% limit and at the completion of the placement PNGSDP will hold a 13.04% interest in the company.
The placement will be conditional on Highlands obtaining a waiver from ASX Listing Rule 6.18 to grant PNGSDP a right to participate on a pro-rata basis in any future capital raisings.
It is anticipated that this waiver will be granted shortly and following the receipt of this Highlands will receive the placement funding from PNGSDP.
The rights attaching to this fall away should PNGSDP’s shareholding in Highlands drop below 10%

Bart Philemon slams Electoral Commision for deferral in Lae

By MALUM NALU
Lae MP Bart Philemon today (Tuesday, June 26, 2012) slammed the Electoral Commission for deferring yesterday’s polling to today (Wednesday) because of heavy rain.
He said that the sun was shining immediately after the deferral was made.
Philemon also said that several major companies in Lae allowed their employees one day off for voting yesterday and were unlikely to allow them another day off today.

Bart Philemon...no justification for deferral

“The Electoral Commission and Lae returning officer did not consider the ramifications of the decision they made today and its wider impact,” he said.
“The decision was made prematurely before 8 o’clock this morning to cancel voting due to rain.
“Before 9 o’clock this morning, we had beautiful sunshine
“Most of the companies here in Lae closed down today to allow their employees to vote, the likes of Trukai Rice, Hornibrooks Steel, Coca-Cola and so on.
“These companies can’t allow them time off again tomorrow (Wednesday.
“The irresponsible decision by the Electoral Commission today is going to deny a lot of employees in Lae their democratic right to vote tomorrow.
“I’m very disappointed at this very irresponsible and premature decision by the Electoral Commission in Lae.
“There’s no justifiable reason for the irresponsible decision to be made today to defer voting until tomorrow.”

Illicit border trade flourishes during elections

By MALUM NALU

The multi-million kina illicit trade in PNG using smuggled items from Indonesia, particularly cigarettes, is flourishing during the elections with decreased Customs, police and military presence at Wutung Border Post at West Sepik province.
Lack of personnel at Wutung means that smugglers basically have free reign during the election period, as was witnessed by The National at the border post at the weekend.
With PNG lacking maritime strength to patrol the sea border, there is no control of what comes in through this.
Customs were not checking in goods brought in from Batas Market on the Indonesian side of the border at the weekend.
Yesterday (Sunday), The National witnessed the illicit trade at Vanimo Airport, where several carefully-packed cartons of Indonesian cigarettes consigned for Wewak and Mt Hagen were loaded on to an Air Niugini Q400 flight bound for Wewak, without as much as a question being asked as to their contents.
A private intelligence source monitoring the illicit trade at the border, told The National in Vanimo yesterday that a highly-organised racket involving wealthy Highlands businessmen and local Wutung and West Sepik villagers existed.

Cheap Indonesian cigarettes being sold at a roadside stall in Vanimo at the weekend. These cigarettes proliferate in Vanimo and are now being smuggled in large consignments into the Highlands.-Nationalpic by MALUM NALU

A senior government officer told The National in Vanimo yesterday that the illicit trade was a serious threat to national security as guns, drugs and human trafficking could easily be carried out from Indonesia.
The intelligence source said the cigarettes were transported to Aitape near the border of East and West Sepik provinces, and then moved down to Wewak and then Madang for transport to the Highlands.
“It comes from the Batas Market, across the Wutung Border Post, and then comes out towards Vanimo,” he said.
“What the Highlands businessmen are doing is that they liaise with the local villagers and get them to carry Indonesian cigarettes across from Batas.
“They stockpile these cigarettes in the villages until they reach 20-30 cartons.
“These then come out from Wutung Village via boat or road to Aitape, transported by road to Wewak, then loaded onto ships or dinghies for Madang or Bogia, where they are picked up and transported by road to Mt Hagen, Minj or Banz.
“The concern is that these Indonesia cigarettes are brought in without paying any excise duty to the government, which is missing out on millions.”
The senior government officer said this was a very serious threat to national security which must be addressed immediately.
“All stakeholders including Customs, police and PNG defence Force must work together,” he said.
“I do not know what the Border Development Authority is doing.
“There are no patrol boats manning the maritime border with Indonesia.
“Cutoms officers at the Wutung Border Post are under-resourced and this is a very big concern.
“Apart from cigarettes, anything can be brought into PNG like forearms, drugs, anything.
“It’s a concern for the government and they have to address this at the national level.
“Smuggling is very big.”

Air Niugini resumes Daru flights

By GYNNIE KERO


Papua New Guinea flag carrier Air Niugini resumed commercial flights into Daru, Western province, on Thursday (June 21) for the first time in 12 years, The National reports.
This promises to be a massive boost to business, tourism and other economic activities on the South Fly island.
Despite a light downpour, a big crowd gathered at the airport to welcome the arrival of the first Air Niugini commercial flight, a Dash 8- Q315.

Kiwai dancers welcome the inaugural Air Niugini flight to Daru on Thursday.-Nationalpic by GYNNIE KERO

An Air Niugini Q400 did land on Daru on June 1, however, that was a PNG Sustainable Development Program (PNGSDP) charter.
The last Air Niugini flight to Daru was on March 4, 2000, after which it had to stop services because of the unsafe state of the runway.
Air Niugini is able to resume flights because of a K40 million airport upgrade funded 50-50 by PNGSDP and the Fly River provincial government, with construction undertaken by Global Construction and supervised by The National Airports Corporation.
Airlines PNG has had a virtual monopoly of the Daru-Port Moresby route over the last 12 years, with its airfares of K999 one-way among the highest in the country.
Air Niugini’s low est fare on that route is K352.20.
Air Niugini chief executive Wasantha Kumarasiri apologised to the people of Daru and Western province for the inconvenience of the past 12 years, But, he said the airlines could not compromise the safety of its passengers.
He said Air Niugini could not service the township of Daru for many years due to poor airport infrastructure that was not up to standard.
“Flights into Daru were suspended because infrastructure did not meet airport regulations. Air Niugini looks after its customer in the name of safety.”
Flights in and out of Daru are scheduled twice every week, Thursdays and Sundays.

Xstrata to draw back in PNG for South America focus

By BARRY FITZGERALD by: Barry Fitzgerald

From: The Australian
  

XSTRATA'S full development book in South American copper has prompted  the proposed merger partner of Swiss-based Glencore to seek buyers for its 81.82 per cent stake in Papua New Guinea's Frieda River copper-gold project, one of the world's biggest undeveloped deposits of the metals.

The stake could be worth more than $US650 million ($639m).  

News of the sale was let slip by its 18.18 per cent junior partner in  the project, ASX-listed Highlands Pacific, as part of its "cleansing statement" ahead of an expected 15 per cent placement to the PNG
Sustainable Development Program, which holds BHP Billiton's former 52 per cent stake in the environmentally controversial Ok Tedi copper-gold mine.

Xstrata was caught on the hop by Highland's disclosure to the ASX, but  later confirmed that part of its continuous review process was "assessing the interest of other investors in the Frieda River
project".

That confirmation follows industry speculation Xstrata had been  approaching state-owned Chinese groups with a view to gauging their interest in taking up the running at Frieda River, but to no avail.
The sale process has since firmed up with the appointment of Merrill Lynch to advise on a trade sale.

Frieda River ranks as a 13 million tonne copper deposit, with 20  million ounces of gold. 

The partners have been working towards a development that be the  world's 12th-biggest copper producer, with forecast annual average output in the first eight years of 246,000 tonnes of copper and
380,000 ounces of gold.

Despite the possible sale of Frieda River, Xstrata is out to climb the  ranks of global copper producers by increasing annual production by more than 60 per cent to 1.5 million tonnes over three years.

Peruvian projects Antapaccay and Las Bambas underpin the surge.
Xstrata has coasted its copper production surge at $US7 billion.

Xstrata's 81.82 per cent stake in Frieda River is based on completion  of a feasibility study on its development by the end of the year. 

If it sells or joint-ventures the asset before then, Highlands has a pre-emptive right to increase its interest to 28 per cent.

Analysts said a valuation metric of US3c-US4c a pound of (undeveloped)  copper would make Xstrata's share of Frieda River worth about $US650m-$US850m.

If Highlands were to revert to a 28 per cent stake, its holding would  be worth $US250m-$US340m on the same basis.

That has implications for the valuation of Highlands, as its market  capitalisation was $100m before its trading was halted. 

Highlands' expected placement to the PNG Sustainable Development Program is to raise funds to step up exploration at its Star Mountains tenements, 20km from Ok Tedi, which needs extra resources to extend its mine's
life.

Xstrata's sale process for Frieda River does not extend to its joint  venture in the equally big Tampakan copper-gold project in the southern Philippines.

Xstrata owns 62.5 per cent and ASX-listed Indophil 37.5 per cent.  

The partners are waiting on the Philippines government to deliver its  long-awaited mining policy, expected by next week, and the removal of a provincial open-cut mining ban