Oil Search denies blaming PNG govt for project problems

3:00 pm on 16 May 2018

The oil and gas company Oil Search denies that it blamed Papua New Guinea's government for non-payment of benefits from the LNG gas project.

This comes after statements by the Oil Search chairman at its Annual General Meeting last week acknowledging landowner frustrations over project payouts.

Oil Search claimed its chairman's comments were mis-reported.

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There have been complaints of a lack of benefits coming from the LNG project Photo: RNZI/Johnny Blades

In a new statement it said that during the annual meeting, the company outlined the need to ensure royalty payments and other benefits owing to landowners were distributed as soon as practicable.

Oil Search said it was working closely with the PNG government and other stakeholders to ensure the project benefits owing were distributed as soon as possible.

The statement said that at no time had Oil Search accused the government of being responsible for the delay in the payment of these benefits, rather it had outlined to its shareholders that it had fulfilled all of its requirements under the Oil and Gas Act.

"We also stressed that substantial progress had been made by the Government in this area over the last 12 months and more was expected in the short term," Oil Search said.

However, the Governor of PNG's Hela province criticised developers of the LNG gas project, ExxonMobil and Oil Search, over lack of payments to his province.

Philip Undialu said when establishing the project, corporate giants bullied PNG politicians into a substandard agreement.

The Governor said Provincial Governments of the LNG Project area lost nearly $US240 million in Development Levies and Royalties over the last four years.

Mr Undialu said there were hundreds of millions more dollars in royalties which Hela people should have been paid.

"It is pathetic for Chairman of Oil Search to attack the Government after robbing it's people through a flawed agreement the Somare Government facilitated between 2008 to 2010," Mr Undialu said.

He called on lead developer ExxonMobil and its project partner Oil Search to admit this failure and pay Hela what belongs to its people, saying the province desperately needs money after February's major earthquake.

ExxonMobil officers receive a petition from landowners in Hela Province, Papua New Guinea.

In the past there have been protests and petitions related to the LNG projects Photo: Supplied

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