PNG better off without gas project: report


An expected economic boom has not come from Papua New Guinea's natural gas project, which attracted an Australian government loan of one billion dollars, says a new report.

The ExxonMobil project supplies eight million tonnes of gas per year to Japan, South Korea and China.

Australia's export credit agency Efic made its largest ever $ 500 million loan to ExxonMobil, OilSearch, Santos and PNG government in 2009.

A New Research Report of Jubilee Australia struck joint ventures blown up projections of growth.

"The PNG population would have been better if the project had not happened," co-author Paul Flanagan said.

Among the results of the report: 19659003] * Despite predictions of a doubling in the economy, the result was a gain of only 10%, and all this focused on the largely foreign-owned resource sector.

* Despite predictions of 84% cent increase in house income, the result was a decrease of six per cent.

* Despite predictions of a 42% increase in employment, the result was a decrease of 27 per cent.

* The project has a negative impact on the PNG government budget of at least 200 million. China (81 million USD) in 2016, and it will not change until 2024.

ExxonMobil defended the project, which said it had contributed 5.69 billion. dollars to local businesses and government through employment taxes and royalties.

"Good governance, accountability and revenue transparency are crucial to ensuring that the value unlocked from gas resources in PNG results in economic growth, increased opportunities and a better standard of living for Papua New Guineaans," says a spokeswoman.

Flanagan, a former Australian finance minister and Jubilee's Australian Director Luke Fletcher called for greater transparency in Efic's decisions.

The report acknowledged that the project had been a remarkable technological success and produced higher levels of export earnings than expected.

However, there were serious mistakes in the initial economic analysis and an overly generous tax agreement.

PNG Prime Minister Peter O & # 39; Neill has repeatedly blamed his fighting government funds for falling commodity prices.

Dr Fletcher said that Exxon and Oil Search should have paid half a billion dollars to the PNG government every year since the gas started flowing in 2014.

"Instead, they pay a fraction of this amount, partly due of their use of tax havens in the Netherlands and the Bahamas. "

The couple pointed out that Jubilee Australia had raised concerns about the project's economic viability and dangerous social risks conflict in an open letter to then Secretary of Trade Simon Crean in 2009, two months before the loan decision was made taken.

The organization had warned the PNG LNG project is unlikely to lead to poverty-reducing growth in PNG.

PNG is recovering from February's deadly earthquake at 7.5 levels on the highlands.

The gas project is expected to return to full capacity next month after earthquake management.

The second train at the factory near Port Moresby is now operational and exports have resumed.

ExxonMobil said 82% Of the 2600 employees, Papua was New Guinea and 22 per cent. were women

The government's allocation of royalties and benefits to landowners began in 2017 and more payments to farmers will start once the landowner identification process has been completed.

Comment has been requested from Efic.



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