Archive for LNG

Exxon Mobil LNG a “very serious threat to national security” says Sandline hero

Posted in Crime - general with tags , , , , , , , , , , on March 22, 2010 by crimeandcorruptionpng

Former PNG Defence Force Commander, Major General Jerry Singirok, has issued a stark warning that the Exxon-Mobil LNG project could lead to a civil war in PNG bigger than the Bougainville crisis.

Foreign-owned security companies "pose a great threat to the country": Singirok

“If they are not careful with what is happening in the LNG project area, the situation there can be much larger and far worse than Bougainville,” says the man who masterminded the departure of mercenaries hired by the Government to put down the Bougainville rebellion 13 years ago.

“My greatest fear right now is that we are now setting the stage for another Bougainville crisis in Southern Highlands because all the right conditions are there”.

Singirok says the government has failed to heed lessons about allowing foreign security companies to work in PNG, especially in big resource projects.

“Now with the LNG project in the Southern Highlands, the Government has allowed developers to bring in foreign-owned security companies [like G4S, the world’s largest security company, which has recently established itself in PNG] that have no appreciation of the local customs, cultures and the people.

“These companies are dismantling the police and Defence Force by recruiting their best men to work on the project sites with promises of better pay and conditions,” Gen Singirok said.

“With lousy pay and service conditions, police and Defence Force personnel are living below poverty line. That is why they are taking up offers to work as security personnel for foreign-owned security companies at the LNG project,” Gen Singirok said.

“Has anyone done any due diligence checks on these foreign security companies?” he asked.

Gen Singirok said the foreign-owned security companies came here with one purpose, to use maximum force against landowners or anyone who tried to frustrate work on the project.

“The presence of foreign-owned security companies in PNG poses a great threat to the country.

“I want to know what their rules of engagement are, what types of firepower they have and who authorised them to have high-powered firearms.

“The use of foreign private security companies happens in countries where the state has failed to provide the needed security.

“Conditions are ripe for a major crisis if the Government is not careful.

“Firstly, there is a serious breakdown of law and order in Southern Highlands province right now.

“Secondly is the massive build-up of illegal firearms as a result of lack of control by State law enforcement agencies to contain the influx of these firearms.

“Thirdly is the lack of border control on the PNG-Indonesia border as well as the PNG-Australian border.

“The fourth issue is the obvious lack of Government investment in Defence Force, police and Correctional Services.

“These are the concerns that all add up to what I call a very serious threat to our national security by governments in office,” Gen Singirok said.


Landowners demand K2 million and 100 pigs from Exxon Mobil

Posted in Crime - general with tags , , , , , on February 28, 2010 by crimeandcorruptionpng

Porebada villagers from Central Province in Papua New Guinea have increased their compensation demands to Exxon Mobil for the killing of four youths, injuries to several others and destruction of food gardens over a land dispute along the corridor road to Exxon’s Liquified Natural Gas plant site.

Angry at the company’s failure to meet a 14 day deadline for compensation the villagers have begun blockading the Porebada/Boera road – again disrupting preparatory construction work for the LNG plant – and have upped the compensation demand from K700,000 and 50 pigs to K2 million and 100 pigs.

According to Porebada villagers’ spokesman, Colin Morea the purpose of their peaceful sit-in protest was to force Sir Moi Avei, his Boera people, Exxon Mobil and the National Government to pay their compensation claim because the deadline had lapsed.

“We gave them 14 days to respond but they failed to meet our demand therefore we decided to halt the PNG LNG project,” said Mr Morea.

He said from yesterday onwards their new demand from Sir Moi and Boera people, Exxon Mobil and the State would be K2 million plus 100 pigs from previous demands of K700,000 plus 50 pigs.

Mr Morea said they would continue with their sit-in protest, blocking the road until their demands are met.

Transparency International slams government for lack of respect

Posted in Corruption - general with tags , , , , on February 22, 2010 by crimeandcorruptionpng

TRANSPARENCY International PNG (TIPNG) has slammed the government for its lack of repect for the ordinary people of Papua New Guinea and its ‘don’t care’ attitude about missing public finances, in comments reported in The National.

TI has also highlighted how the government’s tolerance of wide spread corruption translates into the non delivery of services to the vast majority of the population and foreshadows how most of the proceeds from major new projects like LNG will likely be stolen.

Transparency International’s concerns have been fueled by the findings of the Public Accounts Committee (PAC) which has documented the collapse of the Governments’ financial management systems and revealed a complete lack of accountability within the public service.

TIPNG chairman Peter Aitsi said: “It is very sad to learn from the PAC that from the 1,000 inquiries carried out by the PAC into the operations of various Government agencies, hospital boards, and trust accounts, most have not complied with lawful requirements. “The Government must wake up. The PAC has sounded the alarm and the National Executive Council (NEC) must address this situation as its highest priority. “We understand the various PAC reports have been sitting with the NEC gathering dust. “If this is true, then indeed this is a cause for national shame.”

He said it was totally unacceptable that the Government, particularly the NEC, turned a blind eye to the reports. “What does it tell our people when one of the highest decision-making bodies in our country allows public money to be mismanaged and stolen. “It creates doubts and the people are asking, don’t they care? Are they involved? “This state of affairs suggests the Government has no respect for the people it is sworn to serve and is certainly not serious about ensuring that proper procedures and regulations, particularly the Financial Management Act, are adhered to by all agencies in a transparent manner.”

Mr Aitsi said such lack of action by the Government continued to feed and encourage more unlawful practices, translating into non-delivery of goods and services to ordinary Papua New Guineans. The PAC reports and the statement issued must resonate with the key people in Government that we are heading on a dangerous path. In the words of the PAC member and Eastern Highlands Governor Malcolm Kela-Smith, the loss of public funds as a result of corruption could be as high as K3 billion kina.

“If these corrupt networks are able to steal K3 billion of public money within our current economic levels, how much more are they likely to steal when the revenue for the LNG start flowing if we do not take firm and decisive action to fix our Government systems?”

Controversy over LNG project another symptom of corruption

Posted in Corruption - general with tags , , , , , on February 15, 2010 by crimeandcorruptionpng

While major resource projects continue to extract millions of dollars of oil and minerals from the ground, life for ordinary Papua New Guineans just gets worse and energy giant ExxonMobil’s new liquified natural gas project looks set to continue the trend .

Already work has been suspended on the gas liquefaction plant in Port Moresby after four local villagers were killed in a tribal dispute and extra police and troops are being rushed to the Southern Highlands to quell tribal violence at that end of the project.

With rising maternal mortality rates; increasing poverty and only 45% of children finishing primary school it seems corruption will ensure this latest large-scale projects will only benefit the rich – as Al Jazeerah reports in this new video.

Four more deaths blamed on ExxonMobil LNG project

Posted in Corruption - general with tags , , , on February 1, 2010 by crimeandcorruptionpng

Four more Papua New Guinean’s are dead and two are in a critical condition after further violent clashes between ingigenous groups fighting over land ownership and benefits from the huge ExxonMobil liquified natural gas project in Papua New Guinea.

These latest deaths, close to the capital Port Moresby, follow the reported killing of up to eleven people in tribing fighting over benefits from the project in the Southern Highlands about a week ago.

The latest deaths occurred over the weekend in a dispute between the Boera and Porebada villages over who owns the site where the LNG project liquefaction plant, storage and shipping facilities will be built at a cost of some US$7 billion.

Although the contract for the initial construction work has already been awarded, to a Japanese company, these latest deaths seem to confirm that ExxonMobil has failed to do the most basic preparatory work with local landowners and that there will be plenty of further violence as the project is implemented.

A mobile police unit is now trying to restore calm in the area but in the meantime road construction works have been stopped. There is no indication from ExxonMobil about whether it is satisfied it has the prior informed consent of local people and what steps it will now take to improve the situation on the ground, both in Port Moresby, where the shipping will take place, and the Southern Highlands where the gas is located.

In the meantime, unless urgent steps are taken, the LNG project seems destined to further rubbish the human rights record of the oil, gas and mining industries when operating in PNG and other less developed countries.

Further report in the Sydney Morning Herald –

Eleven killed in PNG ExxonMobil dispute

Posted in Crime - general with tags , , , on January 25, 2010 by crimeandcorruptionpng


Eleven Papua New Guineans have been fatally shot amid a dispute over profits from a pipeline carrying liquid natural gas (LNG) from an ExxonMobil site in PNG’s Southern Highlands to Port Moresby, local media reports.

A gang of villagers from Erave district, in the Southern Highlands, attacked their neighbouring clan with high-powered guns in an early morning raid over the weekend.

Women and children fled as homes were torched and property destroyed in the attack, which killed 11 people, PNG’s Post Courier newspaper reports.

The raid is believed to be retaliation for a previous killing that happened in the lead-up to LNG benefit-sharing negotiations last December.

Thousands of landowners from a variety of groups are set to profit from an $16 billion LNG project that from 2014 will pump gas from the Southern Highlands to the capital Port Moresby 600km away, before shipping it to mainly Asian buyers for a predicted 30 years.

The landowners affected by the pipeline spent weeks cutting a deal with the PNG government, but tensions remain as some landowners believe they missed out or were excluded from the talks.

PNG’s Highlands region is notorious for tribal conflicts and payback attacks for a variety of reasons from land disputes to pig distribution.

The conflicts are often tied to ongoing fights dating back decades.

Comment was being sought from ExxonMobil.

ExxonMobil LNG project blighted by corruption and security concerns

Posted in Corruption - general with tags , , on January 19, 2010 by crimeandcorruptionpng

Project documentation for the recently announced $15 billion ExxonMobil liqified natural gas (LNG) project in Papua New Guinea reveals many corruption and security concerns. If these are not addressed there is a very real chance the project will only intensify PNG’s governance crisis and lead to more civil unrest.

Concerns include the lack of transparency about the size of government revenues from the project and where they will end up; the use of tax havens by companies involved in the project; the involvement of firms already implicated is massive fraud and corruption scandals; a failure to follow international protocols to investigate political interests in the project; the lack of transparency and fairness in agreements with indigenous landowners; and a failure to plan for the massive social impacts of imported labour, especially in relation to HIV/Aids.

The international Extractive Industries Transparency Initiative was established in 2002 and requires companies to publish the revenues they pay to governments and governments to publish the revenues they receive. Such disclosure allows the public to see how much money is being generated and if it is being directed towards uses other than those for which it is intended and to help direct revenues to public interest needs. ExxonMobil claims to be a supporter of EITA, as is the United States government, yet none of the EITI requirements have been included in the project documentation for the PNG project which suggests there is an intention to avoid any transparency or public disclosure. In a country like PNG which is already blighted by government corruption and the mysterious disapperance of billions of dollars of government cash every year, this lack of transparency will only intensify public concerns.

There has also been a complete lack of transparency about the benefit sharing agreements with local indigenous landowners. Transparency International has spoken of its “grave concerns” after the groups invitation to serve as an independent observer in the funding negotiations was abruptly withdrawn. At this stage there is no information to suggest the promised revenues for indigenous groups will be adequate or that they will not be diverted into the pockets of politicians and other leaders.

ExxonMobil has recently awarded contracts for the front end engineering and design work for the PNG LNG project to a joint venture company jointly owned by Kellogg, Brown and Root (KBR) from the USA. A former CEO of KBR has recently pleaded guilty to involvement in paying $182 million in bribes to secure contracts for a Nigerian LNG project. In February last year KBR itself pleaded guilty to being involved in corruption and agreed (along with Halliburton) to pay $579 million in penalties. ExxonMobil’s decision to involve KBR in the PNG LNG project sends a clear signal that not only will it tolerate corruption it will reward those involved.

The PNG LNG project involves many individuals who meet the criteria of ‘Politically Exposed Persons’ as a result of their position in government or the executive or family connections. Many countries have laws that require PEPs to be identified and for financial institutions to perform due diligence on any transactions with which they could be involved. ExxonMobil has not chosen to identify the PEPs involved in the PNG LNG project which raises further concerns.

Further, the PNG LNG company is registered in the Bahamas – one of the world’s most notorious tax havens. There has been no legitimate explanation given for why this location has been chosen or whose interests this will serve. This only increases the legitimate criticism and suspicion surrounding the project.

There is also serious concern about the social impacts of the huge LNG project and the failure of ExxonMobil to properly recognize these in the project documentation or plan for their management. These social impacts are bound to lead to further tensions across PNG – a country that is already very familiar with tribal fighting, violence against women and where other major resource projects have provoked violent demonstrations and, indeed, a civil war.