By Alfred Kaiabe LLB ML
The National Gas Corporation Ltd is the short-term and long-term answer, and has the answer, to the current energy and energy crisis and to the long-term national energy security. But the National Gas Corporation Ltd must first go to court.
1 The Puma BPNG crisis
The Puma BPNG crisis is the end result of 15 years stupidity of Arthur Somare, Willam Duma and the six men Ministerial kitchen cabinet, in collusion with the PPL licensees of Hides, Juha and the Angore gas fields, to export all gas resources in those fields under section 69 of the Oil and gas Act (OGA), thus deliberately refusing to read and omitting the mandatory prerequisite OGA section 68 (2) which provides for all natural gas in PNG to be processed on shore through petroleum processing facilities in PNG, by the National Gas Corporation Ltd under powers conferred on it by section 179 of the OGA. Petroleum Processing facilities includes both Oil refineries and Natural Gas processing facilities,
And the National Gas Corporation Ltd (NGCL) is created by the same section 179 of the same OGA, and is equipped with the same mandatory "shall" requisite mandate to do "downstream processing" of all oil and gas, and to be the "domestic gas operator and domestic gas supplier." The NGCL is mandated to utilize the dry gas as feedstock to firepower to industrialize PNG and to process all natural gas including condensates and oil, on shore so we add value to our oil and gas resources including refining the products of petroleum and A1 aviation fuel - the subject of the current crisis. The current Petroleum Minister Kerenga Kua was also in the background loading Arthur Somare with all his flawed legal advise and contributed to the current issue.
Thus 15 years later PNG is at the receiving end of constant Government Policy failure, beginning in 2008, in enabling the NGCL to realize its legislated mandate to address this country energy security issue through the OGA to which I was co architect as MP for Komo Margarima open, the electorate that now hosts the Hides Gas project. Prime Minister James Marape need not panic and start talking about getting irrelevant Kumul Petroleum and MRDC, both of which lack legislated mandate, together with the oil and gas license holders in this country, to talk about or do downstream processing, and or to build refineries from the gas condensate and oil. Why? Because whilst we file our case for judicial cleansing and purifying of our Oil and Gas Act mandate, NGCL has been securing funds to bring into the country to build the Oil Refineries and Natural Gas processing facilities and funding the National Electricity Roll Out Programme (NEROP) and the country’s SEZ programmers, assist in balancing the 2023 deficit budget and the unbalanced Debt to GDP ratio, and more! But some of Prime Minister generals are becoming mischievous in the background polarizing the law, so NGC has to go to court to bring them into the radar screen of the judiciary to get them to behave properly and decently in the presence of NGC’s proposed international funders.
2. NGCL mandate to borrow
The NGCL has been in the background utilizing its legislated mandate to borrow, again under section 179 OGA, from the international financial lending institutions after Prime Minister made the announcement on the floor of Parliament on 3rd September 2020 that his government will recognize the legislated mandate of the NGCL per section 179 of the OGA ,and that other state entities should ensure that they should not step on the toes of NGCL’s legislated mandate, and if they have, the Prime Minister said that his government will correct it. The correction bit however, could not happen because the same Ministers and individuals who hijacked NGCL during the days of the PNG LNG Agreement 2008, and Kokopo UBSA 2009, are with him in cabinet, and have been the obstacles. Whilst NGCL awaits sanity to prevail over the thinking process of the relevant Ministers, the Puma Energy crisis has now begun. This among others has prompted the NGCL to wait no more but to now go to court.
3. Why NGCL is going to Court
NGCL is going to court to clear these Ministers and individuals of their political excess luggage motives, so that the Prime Minister continues to see the laws, as he wants to, but now clearly defined by the courts, so that excess luggage motives in the thinking process of Ministers, Governors, and so called advisors since the PNG LNG Agreement 2008 days, do not obscure the Prime Ministers vision he now has of the philosophy behind why the NGCL was set up and mandated with the downstream processing mandate.
NGCL is also going to court to get the court to define its legislated mandate so that Papua New Guinea sees why and how NGC is mandated to be the legislated answer to today’s fuel problem, that should have been addressed fifteen years ago at the time of the PNG LNG Agreement 2008, through that fateful Agreement. And NGC can only go to court when a Hela man is Prime Minister, and when a Hela man is in the Chair of the NGCL, so that should the Prime Minister continue to listen to advises of these "Ministers and individuals with ulterior motives of excess luggages " then at least the last man standing from Hela who co drafted the Oil and Gas Act, to provide for our gas resources in this country, beginning in Hela, has attempted to help him see the law, as he should see. The other, the late Anderson Agiru is no longer. To continue to so listen to politically polarised advises, may also prove to be to his political peril, as the NGCL is owned by the twenty-two provincial governments.
NGCL's fund arrangers and proposed funders are aware of the acute energy and energy security crisis our country is going through and are doing their best to expedite the facilitation of our application for loan. So NGCL not just going to court. NGCL is going to court with the monetary solution to the current crisis, and this country's national energy security, in the background. Our NGCL international fund arrangers have read our legislated borrowing powers but with the obstacles of Ministers like Kerenga Kua who deliberately refuses to acknowledge the existence of sections 68(2) and section 179 in the Oil and Gas Act, I am going to Court to ask the court to direct Kerenga Kua and the likes of him, to see through the judicial eyes of the law and the end resultant justice, so that NGCL's legislated and scared mandates are not polarized by confused individuals in the chairs of Ministers in the Executive Government. NGCL's proposed funders must see that the NGCL's sacred sections 68 and 179 OGA mandates has gone through the centrifuge of judicial process, so that there is no political mingling with their hard-earned money proposed to be loaned to NGCL.
4, Parties to the proposed case
Kumul Petroleum Holdings Ltd (KPHL) too will be party to the NGCL case so Wapu Sonk and his team might as well stop misleading the Prime Minister. You have no mandate to do downstream processing and you have no mandate to manage the LLGs and Landowners (of the five PNG LNG Project affected Provincial Governments) 4.22% equity. This is NGCs mandated role. I hear MRDC is going to court to wrestle the 4.22 % from KPHL. MRDC too is riding on stolen NGCL mandate, managing the 2.87% CDOA upstream equity. MRDC too will be on the judicial radar screen. MRDC has illegally created a power company called Dirio Power Ltd utilizing Provincial Governments and landowners money it is not mandated to manage. The utilization of gas project royalty and or equity monies by MRDC is illegal and must also come under the judicial radar screen. MRDC subsidiary, Dirio power has been hijacking NGCL mandate and signing gas purchase agreement with the Hides Gas Project Licensee and power purchase agreements with PNG Power Ltd. That too will come under judicial determination. The recent collusion between Hela Provincial Government and MRDC to set up the Hela Trust Account too is daylight illegality. Only NGCL can and will, by law manage these funds. I am sorry that the Minister for Finance has been hoodwinked into thinking that this is possible. I am basically asking the court to rescue public money proposed to be managed through public policy on the run, and not through law. The establishment of Trust account by Ministerial determination, outside of the law, is in the NGCL's view, ultra vires section 179 OGA, and will ask the court to nullify it. NGCL will also be asking the court to report to NGCL how it managed NGCL's 4% interest in Hides Gas Project, which the NEC authorized through NEC Decision 51/2002 and why it did not take steps to protect it when through Arthur Somare's Kokopo political whirlwind, all of the 22.5% state interest (reduced to 19.5%) got sucked into K2 self company Kroton No 2 Ltd, after Hon William Duma, then Minister for Petroleum and Energy successfully sidelined NGCL into eternity. NGCL's stolen 4% is now illegally with KPHL, after Kroton No2 Ltd changed name to National Petroleum company to now KPHL.
The five Governors who formed Dirio power should be ashamed of themselves. You don’t know the meaning of sharing. You have greedily defeated and hijacked the NGCL mandate. I put NGCL in the Oil and Gas Act so that all provinces of PNG share in the proceeds of the exploits of the Natural gas resources in my then Komo Margarima electorate, in accordance with the Prophesy from time immemorial, of the Girira Laitebo., whilst all of you were in Primary School. Leave alone the sharing formula I have crafted into the Oil and Gas Act in and through the National Gas Corporation Ltd. You were not around when those in my time did what we did. Don’t dismantle what I did right in front of my own eyes and especially when I am in the Chair of the NGCL organization I created. It hurts and it pains. Peace.
5. Hela Prophesy of the Gigira Laitebo
Apart from breaching the law, the PNG LNG Project has been, is, and continues to flow gas into eternity, in breach of the Hela Prophesy of the Gigira Laitebo. In sum that prophesy says that men with red legs will come and ask for the fire inside the debts of the glowing ashes of Mt Gigira (now renamed Hides) and when he comes you may give the embers but not the whole of the burning firewood. Never give the whole burning firewood, for the burning log is for you to remove, and when you remove that burning log, and make fire yourself, the whole of Hela land the lands beyond will see light. There are other declarations that follow these and these are only for the prophets and the temples priests. The public know only what is allowed to be given to the public.
My inclusion of sections 68 and 69 into the Oil and Gas Act is in line with that Hela Prophesy of the Gigira Laitebo. Section 68 is in accordance with the prophesy that the bigger piece of the firewood that is still burning is for yourself to utilize so that when you pull the burning wood from the ashes and process the natural gas onshore through downstream processing and power generation you industrialize PNG. In the prophesized light is the power and energy for development. If Ministers for Petroleum and Energy from 1999 up to now were lawyers they would have seen the section 68 mandatory prerequisite and would have initiated the necessary policies to walk the NGCL.
The prophesy has a spiritual dimension which is supposed to compliment the physical had the prophesy been properly translated but everybody wanted their own piece from this prophetic Gigira Laitebo, so the spiritual side cannot compliment. Hence there was no blessing and curse followed and continues to follow. This case maybe the last hope if there are any amends to be made. Instead of giving embers of left over gas through section 69 after enough gas has been secured through NGC for downstream processing, we gave away everything through the PNG LNG project. The PNG LNG Project has hijacked both law and Hela prophesy.
It was intended that the NGCL would be the vehicle through which the age old Hela prophesy project would be translated in accordance, so that those provinces which do not have gas projects in their provinces can also benefit from the shareholding in the NGCL by the provincial governments, so that in accordance with Hela Prophesy, the whole of Hela and the lands beyond Hela, see light. Through this we also translate our 4th National Goals and Directive Principles of the Constitution that calls for the equal distribution of the national wealth. Many of the Governors in this term of Parliament are new comers into Parliament but all would have heard of the existence of the NGCL. NGCL is your company and if Ministers had their unselfish caps on, NGCL would now be a quadrillion dollar company. I will shortly be circulating your draft PEC Submissions to pay up your K1 million share subscription. So far only Manus and Central Provincial Governments paid in their full K1 million share subscription. Morobe will be the third when in the coming days it will pay up its K500,000 outstanding. NCD has paid up K350,000 whilst Enga and East Sepik paid up K50,000 each in 1999, The rest of the provincial governments hold nominal K1.00 shareholders because in 2008 then Minister for Petroleum and Energy tried to hijack the NGCL by putting his crony as MD for NGCL, so just in case something happened, I made sure all provincial governments were all nominal shareholders, and I reminded the Minister that there was no space, so adamant that his man should be the MD for NGC, he did some things to hijack NGC but the details are for the court of justice.
6. Madang Governors Council Resolution and NGC Board resolutions of support
NGC is filing this proceedings based on the Madang Governor’s Council resolution dated 12th July, 2018, to file class action in re the PNG LNG Agreement and the Kokopo UBSA, and on the resolution of the Board of the NGCL. I will immediately get stiff opposition from the five provincial governors from the PNG LNG affected provinces but they will be exposing more of their greed. NGC will stand its ground and will need the support of the remaining 17 Governors who come from provinces that do not host gas projects. After this five governors formed Dirio Power Ltd, I heard that Gulf Provincial Government has formed Gulf Energy Ltd and Morobe has formed Morobe Power Holdings Limited. Not long this country will have more than 22 mini oil and gas provincial power companies’ thus creating chaos and confusion, leading to provincial inequality and unfair distribution of our national wealth. Governors are elected to make laws and to frame policies around those laws, frame the rolling five years development plan around the policies, translate the plans into programmes of project development, and finally draw up the provincial policy driven budget. Leave the gas and power business to your company, the NGCL.
I ask Governors of provinces not to support Minister Kua’s proposed Organic Law and Petroleum Authority Bill because what they do is that the Organic Law recognizes only the Kumul Petroleum. Further the Petroleum Authority Bill removes the NGC legislated mandate for downstream processing and gives to Kumul Petroleum so that everything is taken back to Waigani. This reflects the total insanity of the thinking process of those behind this proposed laws.
7. Crux of NGCL's case.
The crux of the NGCL's case is that the State owns all gas per section 6 of the OGA and section 212(1) B of the PNG constitution. NGCL goes further and says that the legal meaning of ownership is about and includes possession of property, and in the right to possess, is the right to decide how the owner will deal with its property. NGC says that in the case of all oil and gas property in PNG, the State, which owns all gas and oil property in PNG, has already decided through its own state law namely OGA, section 68(2) and section 179, that all oil and natural gas it owns in PNG “shall be processed onshore” through processing facilities owned by NGCL. This means that the state’s ownership in oil and gas has been transferred through its own state law, to the National Gas Corporation Ltd, to refine and process on shore in PNG.
This is the combined effect of sections 6, 68 (2) and 179 OGA and section 212 (1) B of the constitution. The current PNG LNG Project is a section 69 LNG fractionation/liquefaction plant that hijacked the section 68 (2) and 179 NGCL’s mandates and is therefore flawed and illegal. A section 69 LNG project is given life by section 68 (2) umbilical cord because a section 69 LNG Agreement is for export of gas overseas, and by section 68 (2), you cannot export unless and until NGCL decides at a section 48 OGA Development Forum, how much tcf volume of gas it required for power generation for industrialization and for downstream processing, before you talk about exporting natural gas. It is only after whatever volume of gas is agreed for domestic use (DMO) is to meet the domestic market obligation is set aside for NGCL first at the section 48 Development Forum and signed into a section 50/50A Development Agreement, then you talk about exporting through a section 184 gas agreement rooted in section 69, if there is excess gas. NGCL must have its say because state ownership in all gas and oil has been transferred to NGCL, as I clearly showed above.
That is why the PPL license holder is a party to the OGA section 48 Development Forum, so that he knows how much leftover gas from his licensed project is there (if any) to export overseas through a section 69-rooted section 184 Gas Agreement. Section 69 is dependent on and contingent to section 68 (2) and must be read subject to section 68 (2). Section 69 has no independent standalone existence. It only comes alive when its substantive umbilical section 68 (2) cord is activated. A standalone section 69 LNG project is therefore illegal because there was no development forum called for NGC to claim its gas quota for downstream processing, DMO and gas fired power generation, as required under and by section 48 of the OGA I co drafted. This is the Hon Arthur Somare and Hon William Duma lunacy. The current PNG LNG Project is an illegal standalone section 69 LNG Project. It must be so declared by the court, and shall be renegotiated. This is the crux of the NGC case. Because of this stupidity, NGC lost its 4% interest in the Hides Gas Project through the Hons Arthur Somare and William Duma political whirlwinds in Kokopo, when they directed the whole of the State interest, including NGC's 4%, in an unheard of K2 self company called Kroton No 2 Ltd (now Kumul Petroleum) created through Arthur Somare’s “public policy on the run”, in Kokopo. The 8 million people of this country must support this NGCL case. It is your case. It is your children’s case. NGCL is taking back PNG from fools within.
This is something for all lawyers to read and you will see how these so called "Honourable Ministers" have been deliberately misleading this country. Lawyers employed by provincial governments or attached to provincial governments should pay serious attention to what I say here and advise your Governors and MPs accordingly. The 22 Provincial Governments, and therefore the 8 million people of this country, are filing this case. The State Solicitor and all lawyers must reread the Oil and Gas Act and in particular the provisions I refer to above and discuss, for after I have filed, the matter will be subjudice
8. Current PNG LNG Project illegal
The current PNG LNG Project is flawed and has set the wrong precedent for other gas projects in PNG, including the Papua LNG project. It is driven by a flawed and deliberate misinterpretation of the law, that had a section 69 OGA Gas Agreement signed, and twisted the order of the construction of the section 68 substantive clause and the section 69 contingent ancillary clause. This twisted order hijacked the order of the proper flow of relevant enabling sections of the OGA, including the holding of the section 48 Development Forum, the signing of the sections 50/50A Development Agreement, the grant of the section 57 Development License, section 74 Pipeline license and section 88 Processing Facility Licenses. This is not only a bad but more so and illegal precedent. It is illegal because Arthur Somare, then as Minister for State Enterprises, had the PNG LNG Agreement drafted by outside lawyers, but on the morning of the NEC Meeting to approve the PNG LNG Agreement, forced then Attorney General Dr Allan Marat to give the certificate of legal and constitutional correctness of the more than 200 pages PNG LNG Agreement 2008 by 2 pm that same day! Why? Because NEC was meeting to approve that purported PNG LNG Agreement at 3 o’clock that same day! This is Papua New Guinea public policy on the run!
The constitutional office of the Attorney General of Papua New Guinea never partook in the discussions, dialogue and drafting of that purported Agreement, and was threatened with the decommissioning of his Ministerial portfolio, to sign the constitutional correctness of the PNG LNG Agreement. But now Minster for Petroleum and Energy Kerenga Kua has admitted to some people that he assisted in the process of the drafting of the PNG LNG Agreement. Minister Kua cannot now use his position as Minister for Petroleum and Energy, and cover up his contribution to the current legalized international fraud and thievery by telling lies to the country in saying that there is no current law on DMO so he needs to carve out one, as a camouflage to cover up for this willful and deliberate act to collude with the multinational PPL licensees to ignore sections 68 (2) and section 179 of the Oil and Gas Act, that would have put PNG on the world of billionaires and there would have been no Puma CBPNG crisis today!!!
We now have in place a LNG Project that feeds off from our gas resources through collusion between a few State Ministers and the multinational licensees. The court will be asked to intervene to restore compliance with, inter alia, section 68(2) and section 179 OGA before other oil and gas projects come on stream and for a renegotiation of the PNG LNG Agreement 2008 insanity, Kokopo UBSA 2009 lunacy and the resultant subsequent various LBBSAs.
Where many gas projects are involved, as in the case of the PNG LNG project (if it was a s 68 coordinated gas project), a section 50A Coordinated Development Agreement, echoes the same section 50 prerequisite for NGCL to be reflected in the Coordinated Development Agreement. In the current wrongly section 68 and section 69 combined PNG LNG Project, politicians and their advisors hijacked NGCL’s mandate despite NEC Decision No 223/2008 which directed that NGCL must be a party to the PNG LNG Project. In the subsequent Kokopo UBSA meeting in 2009, responsible Ministers and their associates colluded and also left NGCL out of the meeting. Arthur Somare, who was Deputy Chair to NGCL resigned in Kokopo, obviously for imminent conflict of interest.
The 1997-2002 visionary Papua New Guinea National Parliament to which I was member, already foresaw the need to Take back PNG, and after inserting section 68 to do just that, it proceeded to establish the section 179 implementation national equity vehicle, and the development forum process and the development agreement process, for the NGCL as the national development and equity vehicle, to access the natural gas, to do that downstream processing and to be the domestic gas operator and domestic gas supplier and to provide gas for domestic utilization.
9. NGCLs legislated mandates
Under section 179 of the OGA NGCL’s mandates, are to:
(a) be the Corporate trustee of all Provincial Governments project area landowners who hold assets (Subsection (2)(b));
(b) be the Manager of participating interests of Provincial Governments and project area landowners in gas projects including downstream processing of gas (Subsection 2 (c));
(c) be the Holder of petroleum processing license and permits required for NGC to be a domestic gas operator or a domestic gas supplier or an owner of operator of gas storage facilities (Subsection (2) (d) (ii));
(d) be the Owner of participating interests in gas projects (Subsection (2) (d) (iii));
(e) be the Owner of participating interest in the Hides Gas Project (PDL 1) irrespective of whether the State exercises its back-in right at 22.5% under OGA, s 165 or under any other law (Subsection (2) (d) (iv));
(f) be the Owner of processed petroleum including liquefied petroleum gas (Subsection (2) (d) (v));
(g) be the Owner of interests in any gas project that is purchased from other equity participants (Subsection (2) (d)(vi)); and
(h) have the Capacity to borrow money to acquire and develop assets and to charge those assets against loan debts (Subsection (2)(d) (vii)).
Project “assets” in s 179 (2) (d) (vii) is defined in section 3 to include both current and future property interests in pipelines and petroleum processing facilities. NGCL is therefore mandated to borrow against both current and future property interests in project assets. These borrowing powers become active during a development forum when the quota for downstream processing gas is discussed and therefore how much money is required to be borrowed to pay for the new asset, becomes the necessary issue.
10. Mandatory that all natural gas must be processed on shore in PNG by NGCL
The meaning of the word “shall” in OGA, section 68 (2) is mandatory. Mandatory means compulsory. This means that all natural gas that is the property of Papua New Guinea, is compulsorily required by law, to be processed onshore in Papua New Guinea, and NGCL, once formed, is the entity mandated by the same law to “shall process” all gas onshore in PNG. This also means that any natural gas to be exported outside of PNG are “contingent if” gas, and belong to the contingent exception to the substantive rule, that all gas must be processed onshore in PNG. I say “contingent if gas” because section 69 provides that natural gas shall be exported “only if permitted” by agreement, license or instrument, but only after enough gas has been secured under section 68 for DMO.
I emphasize that the State owns all gas, and ownership is about and includes possession and in the right to possess, is the right to decide how it will deal with its gas resources. The State has already decided through its own State law namely OGA, s 68(2) and s 179, that all natural gas it owns in PNG “shall be processed onshore through processing facilities owned by NGCL”.
OGA, section 6 declares all hydrocarbons belong to the State. Ownership includes possession and dealing with the property in all gas in PNG. Through s 68 the State has decided how to deal with the gas it owns and possesses in PNG. That is to process all and every molecule of natural gas on shore in PNG. The State has gone further and said through s 179 that the vehicle to process all natural gas on shore is NGCL. The only condition is for NGCL to be formed under the Companies Act 1997. NGCL has been formed. It is only if NGCL has not been formed that others can utilize the otherwise exclusive NGCL “shall “mandate. Once NGCL is formed, downstream processing and domestic gas operation and supplying are exclusive NGCL mandates because the right to how to deal with all natural gas in PNG, and therefore ownership has been transferred to NGCL. The only thing left for NGCL to do is to acquire the gas on commercial terms from the gas fields to pipe into its processing facilities and the State and licensees are required by section 68 to sell all natural gas to NGC. The total ownership transfer to NGCL as required by the combined effects of sections 6, 68 (2), 179 of the OGA and sections 53 and 212 (1) B of the constitution, law, is now complete.
Those who facilitated the PNG LNG Agreement knew that they breached the law and have to cover up by proposing superseding legislation, to cover up their breaches of the mandatory provisions of s 68 and s 179 through a series of transactions including the PNG LNG Agreement to the UBSA to the various LBBSA’s. This country’s sovereign laws must be protected and in this case, I say this country is shipping away tons of volume of NGCL gas worth in the trillions of Kina through a flawed legal framework under which the PNG LNG Project, the UBSA and LBBSA’s have been transacted and that they must, and have to be declared null and void, and NGCL is coming to court to ask the court to order the state and the licensees to pay compensation and orders for renegotiation of the flawed PNG LNG Agreement..
OGA, s 68 has secured all and every molecule of gas this country owns, is sent to the processing facility for adding value. There is therefore really nothing left for Minister Kua to introduce new laws to take back by way of product sharing contracts because even if the State holds a 22.5% stake and the 77.5% is held by foreign license holders, in the end, section 68 directs all natural gas into the s 179 NGCL-owned processing facility. And NGCL has the legislated power under section 179 to borrow money from both national and international lending institutions to acquire all the natural gas from the State and the licensees at agreed prices. Minister Kua’s proposal for new laws is therefore, in my view, non sequitur. Non sequitor in Latin means it does not follow, meaning that what the law is now, and what he is proposing to do, does not add. The Prime Minister thinks logically and I am sure there are more logical thinking man in cabinet and also on the floor of parliament, if and when his proposed laws come up for deliberations.
There are some who are now suggesting that Parliament should be immediately recalled to pass the proposed Minister Kua laws. These suggestions are made because we have been deliberately and wrongly made to think that there is no law to address the DMO issue, I have shown above that there is already law. It is wanton and deliberate policy failure that is the problem because politicians want to deal with organizations they can control and manipulate and milk from. There are some Ministers who have tried to push their own cohorts into NGC in 2008 but I have sent them back on reverse gear!
The current Prime Minister James Marape in fact initiated an NEC policy submission on 15th September, 2019, after he came to power, for the recognition of the NGC downstream processing mandate in addition to NEC Decisions 97/2000, 51/2002, 238/2008 and 24/2009 but the Hon Kerenga Kua refused to co operate with the Prime Minister to address the NGC DMO recognition submission despite two letters by the Prime Minister to the Minister to facilitate the submission!
The Prime Minister-directed letter and the draft NEC Submission prepared by the Prime Minister’s office in consultation with the NGCL, is collecting dust in the Prime Minister’s office, whilst Minister Kua’s copy is also collecting dust under his seat as he farts away the draft NGC NEC submission pages into pieces. As I said the law is there. What Minister Kua is doing is ignoring the Prime Minsters direction and wants to now introduce the proposed Organic Law to remove everything from NGC and park everything in the roposed Petroleum Authority Bill. His proposed Petroleum Authority Bill in turn provides for Kumul Petroleum Holdings Ltd, (the company he Chaired for many years as Kroton No2, National Petroleum Company and now under his Ministry as Kumul Petroleum Ltd), to own and control all the natural gas resources. That is why I have asked the 22 Provincial Governors and thinking MPs who come from provinces that do not host gas projects, to refuse this insanity.
This is insanity because Minister Kua is doing something directly opposite to what Minister Richard Maru told the Governor for Simbu and Kua’s own Simbu people that Simbu Province cannot forever ask national government to be baby sitted, and must now look at establishing your own internal revenue base to fund your provincial budgets and translate them into programs of Simbu development. NGC is the answer to Minister Maru’s statement. Downsteam processing is a billion, trillion, quad trillion dollar business and the provinces will be laughing when the provincial coffers begin to see new money in the billions come into the province, beginning with Simbu. Yet Kerenga Kua comes from Simbu province. Absolute lunacy!
It is only through the National Gas Corporations mandate that will ensure that provinces will have more than enough in the billions, that those who are seeking political autonomy will see that their financial autonomy is now in place to justify their call for political autonomy. And we had the Bougainville uprising and the bloodshed on that island in the background when we did the Oil and Gas Act, so that even provinces which did not have gas resources can also put up their hands for provincial autonomy. Many provinces including Simbu province cannot be financially self sustained, and it is beyond my comprehension that this Minister Kua from Simbu cannot corporate with the Prime Minister, but cook up his own legislative methods to take back what should go to Simbu and other non gas producing provinces, back to Waigani's central coffers.
11. PNG LNG Project in Breach of Section 53 of the Constitution of the Independent State of Papua New Guinea.
Putting OGA, sections 6, 68 (2) and s 179 and sections 53 and 212B (1) of the Constitution together, what the law is saying, is that all the natural gas the State owns in PNG has been given to NGCL to be processed by NGCL onshore in PNG. Section 53 of the Constitution protects Papua New Guinea’s interests in property rights, including our interest and property rights in our gas. Therefore, NGCL, as the only vehicle or instrumentality set up by the State to be supplied natural gas for processing in a petroleum processing facility. It is by law vested with the capacity to be licensed to construct, own and operate a petroleum processing facility, to become the sole domestic gas operator and supplier of gas products. NGC goes to the court to ask the court to recognize this NGC ownership transfer in oil and gas, and the legislated capacity of how to deal with the oil and gas, is protected by the section 53 right to protection of the PNG constitution. Whilst NGCL’s statutory mandates remain intact, the State has denied NGCL its interest or right in the natural gas by permitting all natural gas to be exported by the PNG LNG Project under PNG LNG Project Agreement 2008 under section 69. At this juncture I must remind that all oil and gas province landowners are partners by virtue of section 179 pf the Oil and Gas Act, in the downstream processing of all oil and gas on shore in PNG, so that we share the proceeds from this quadtrllion dollar downstream processing industry together. Any landowner group or any interested party are welcome to join as party to this court proceeding. (You will need a lot of money to photocopy my almost half a meter high attachment documents to my Affidavit).
Landowners will be divided on this court case issue. Many will support. A few eating and drinking with MRDC and KPHL will not. But know that it is the coauthor of the Oil and Gas Act, in the Chair of and as the Chair of NGCL filing this case. I am filing this case because Hela and Papua New Guinea's world Bank, the Gigira Laitebo, is being robbed in broad daylight right under our noses and everybody has gone silent. Somebody has to stand up and say enough is enough. I have. Not only for the the current PNG LNG project, but also for future oil and gas projects so that politicians don't hijack our laws. NGCL needs current and future landowners support in this case.
12. State policy failure
The State has failed to provide the necessary regulatory environment under OGA, section 95 and OGA, section 182(1) (e) enabling NGCL to construct, own and operate a petroleum processing facility and to realize its mandate as the domestic gas supplier and domestic gas operator. In the process, the State has on purpose denied NGCL its interest or right in the natural gas by permitting all natural gas to be exported by the PNG LNG Project under PNG LNG Project Agreement 2008 under s 69, wrongfully mixed with ss 48,50/50A, 57, 74 and 88, meant to be utilized for a s 68 mandatory first call downstream processing shall gas project. State failure come about when Ministers refuse to obey the law. Under the Ministerial Determination of responsibities, the Oil and Gas Act comes under the responsibity of the Minister for Petroleum and Energy and the Prime Minister is correct in forwarding the draft submission prepared by his office to him to make his input and facilitate. Just imagine the Prime Minister writing to him twice within a six months space because he did not respond to the first. Below are those two letters.
The Prime Minister also wrote to Hon Lin Stucky as Minister for Treasury and Hon Renbo Paita as Minister for Finance reminding them to now co operate with NGCL. Below are those two letters.
The Prime Minister also wrote to the National Gas Corporation Ltd indicating that his government was now preparing the NEC policy intervention to recognize NGCL’s OGA section 179 mandate, in the terms of the letter below.
Conclusion
The above are the NGCL basis for going to court. What do we call a Petroleum and Energy Minister refusing to obey state law? Minister Kua has gone beyond disobeying State law. He has even disobeyed his own Prime Minister. And the Prime Minister has not done anything on disciplining his Minister. Oh I forgot we are in Melanesia, a land of thousand tribes ruled by philosophy of rule by consensus.
NGCL's proposed international funders want to see the clear cut law they want to see without the political dirt and debris of motives of individual Ministers, Governors, and advisors to the Prime Minister, polarizing state law with their fathers philosophy of rule by compromise. And only the Judiciary can clear the unimpeded landing pad for NGCLs proposed international financiers and give breathing space to the Prime Minister to continue to make the right decisions through law, that he has been making on NGCL.