By PATRICK TALU
MORE than 100,000 contributors of Nambawan Super Limited (NSL) go into the Easter holiday with a timely gift from their fund.They will have credited into their accounts a 10% interest on their savings, their reward from a handsome profit the fund made last year.This was announced in Port Moresby yesterday.Managing director Leon Buskens told reporters in a media conference yesterday: “As I am speaking, staff members are working on crediting members’ accounts and, by next Monday, all accounts should be credited and completed.”The bonanza for NSL contributors continues a super performance by super funds in the country.A month ago, Nasfund announced a 15% interest for its members from its profits last year.Announcing the good news yesterday, NSL chairman Sir Nagora Bogan said the 10% dividend was approved by the board for crediting to 113,546 members after the superfund declared an after-tax profit of K191 million for last year.Sir Nagora said the 10% interest would also include the retirement saving accounts (RSA) while the board had also approved an interim interest rate for members leaving the fund this year. He said the income of K249 million was derived from the fund’s investment, largely attributed to good performances in the interest earnings, property revaluations, international share and exchange rate benefits arising from the drop value in the kina.Sir Nagora told reporters that offset against a headline inflation rate of 5.7%, the declared interest rates represents a real return of 4.3%.He said for the seventh year in a row since the reforms, the fund has delivered double-digit interest and, most importantly, real returns to members.He stressed that determining the annual interest rate was a very serious decision for the board of directors.“The board makes sure proper accounting standards are met.“It also factors in economic forecasts for the next few years to make sure it sets aside sufficient reserves to meet the prudential requirement set by the Bank of Papua New Guinea,” Sir Nagora said.He added that while double-digit interest crediting had been approved for the year, reserves had increased to K74.7 million from the 2008 levels of K66.6 million.”Horim Piamai, a policeman in Mt Hagen who has been contributing for 20 years, told The National 10% interest was good news.“I have K60,000 in my saving and when I retire, that would sustain me in the long run though RSA.”Another contributing member, Dr Oko Pengi, from Wabag General Hospital in Enga province, said the news was good for him.Meanwhile, directors of the board representing public sector unions – Martin Kenehe (PNGTA), Clement Komu (police), Peter Lungo (CS), and Gabriel Panke and Tau Vali (PEA) applauded NSL for declaring a double-digit interest seven years in a row.Mr Buskens also revealed that the fund’s total assets increased to K2.83 billion, an increase of K120 million over the 2008 total of K2.62 billion.
Wednesday, March 31, 2010
Bad roads delay work on LNG
Source:
By ANDREW ALPHONSE
EARLY works on the multi-billion-kina PNG liquefied natural gas (LNG) project is running behind schedule, the delay caused in part by the deteriorating state of the Highlands Highway.An official with Esso Highlands (PNG) Ltd, the subsidiary of ExxonMobil, said equipment and machines for early works for Australian company Glough Curtain Joint Venture (CCJV) were still sitting idle at the wharf in Lae waiting for affected sections of the highway to be repaired and freed up before the equipment and machines could be transported to the project site.One of the worst affected parts is at Kalguwi village, near Kagul River, on the border of Western Highlands and Southern Highlands provinces.Yesterday, a policeman attached with the Kaupena-based police highway patrol unit 17 reported that more than 100 trucks and cars were stranded at either side of the highway at Kalguwi.He said that section of the highway had fallen into a state of complete disrepair and while light four-wheel-drive vehicles were being pushed and pulled to negotiate the landslip and the huge crater-like potholes up the slopes, heavy vehicles were unable to cross.Police highway patrol units have been working around the clock to control traffic and ensure locals do not take advantage of the situation to harass commuters.Imbonggu community leader Pius Alopea said the National Government should immediately look into repairing this section of the highway as it was becoming a national disgrace.Mr Alopea said many vehicles had developed mechanical problems on this section of the road while the flow of goods and services into Southern Highlands had been greatly affected.Mr Alopea said with the current wet season in the region, the road condition would only worsen unless the authorities do something.
By ANDREW ALPHONSE
EARLY works on the multi-billion-kina PNG liquefied natural gas (LNG) project is running behind schedule, the delay caused in part by the deteriorating state of the Highlands Highway.An official with Esso Highlands (PNG) Ltd, the subsidiary of ExxonMobil, said equipment and machines for early works for Australian company Glough Curtain Joint Venture (CCJV) were still sitting idle at the wharf in Lae waiting for affected sections of the highway to be repaired and freed up before the equipment and machines could be transported to the project site.One of the worst affected parts is at Kalguwi village, near Kagul River, on the border of Western Highlands and Southern Highlands provinces.Yesterday, a policeman attached with the Kaupena-based police highway patrol unit 17 reported that more than 100 trucks and cars were stranded at either side of the highway at Kalguwi.He said that section of the highway had fallen into a state of complete disrepair and while light four-wheel-drive vehicles were being pushed and pulled to negotiate the landslip and the huge crater-like potholes up the slopes, heavy vehicles were unable to cross.Police highway patrol units have been working around the clock to control traffic and ensure locals do not take advantage of the situation to harass commuters.Imbonggu community leader Pius Alopea said the National Government should immediately look into repairing this section of the highway as it was becoming a national disgrace.Mr Alopea said many vehicles had developed mechanical problems on this section of the road while the flow of goods and services into Southern Highlands had been greatly affected.Mr Alopea said with the current wet season in the region, the road condition would only worsen unless the authorities do something.
KAML posts ’09 profit
KINA Asset Management Ltd (KAML) has reported a net profit after tax of K4.26 million for last year.This is despite the challenges of the past year from managing the ongoing effects of the global financial crisis.KAML’s end of year report also shows its investment portfolio increased by K3.84 million, or 9.38%, from K40.89 million at the end of December 2008 to K44.72 million at the end of December 2009.KAML chairman Sir Rabbie Namaliu described 2009 as a landmark year for the investment management company and a significant turnaround after recording a net loss of K4.14 million in the launch year, 2008 with all the adversities of the global financial crisis.“KAML’s performance figures for 2009 were very positive for our shareholders and they continue to reflect the increased opportunities for investment and business development that now exist within Papua New Guinea,” Sir Rabbie said.During 2009, KAML’s investments increased by K1.51 million exclusive of exchange rate and K5.39 million inclusive, representing returns of 3.67% and 12.59% respectively.Sir Rabbie said KAML was continuing its expansion strategy and looking at increasing its exposure to international markets including the US and Asia.Last year, the performance results of the International Equities, Asia Fund and the global (Ex Australia) Index Fund all met or exceeded their respective benchmarks.With regards to the global economy, Sir Rabbie said there continued to be strong indicators flowing down from the global markets which suggested that an economic recovery was imminent.He said the International Monetary Fund (IMF) recently forecast the global economy would achieve growth of 3.1% this year, and PNG’s gross domestic produce was also anticipated to rise in the coming 12 months.Moving forward, Sir Rabbie said KAML would continue to adopt a proactive, yet measured, investment strategy designed to build upon its current portfolio and maximise growth opportunities in the current economic climate.“The board of KAML will continue to pursue a range of strategic investment opportunities with the aim of maximising long-term benefits for our shareholders,” he said.“Whilst the key financial indicators are promising moving forward, it is important to note that the global economy is still fragile after the worst recession in more than half a Century.“There will no doubt be opportunities for growth and development in the subsequent economic recovery process, however the challenge remains to ensure that KAML is both financially and strategically well placed to take advantage of these opportunities when they arise,” Sir Rabbie said.
New home sales fell in Feb: Report
SYDNEY: New home sales fell last month, raising concerns about the sustainability of the housing recovery, amid the prospect of further interest rate rises.The Housing Industry Association (HIA) new home sales report showed a 5.2% dip in sales to around 7,000 dwellings last month.The fall follows a 9.5% rise to 8,444 new home sales in January.The HIA said the February fall raised fresh concerns regarding the sustainability of a recovery in residential construction and that deterrents to building new homes such as land shortages would push potential buyers towards existing homes.HIA chief economist Harley Dale said residential construction was still relatively strong, reflecting the monetary and fiscal policy stimulus of last year.“This stimulus has been highly successful in driving the first stage new home building recovery but that stimulus will soon start to fade,” Dr Dale said in a statement yesterday.“Land and labour shortages, frustrating planning delays and the inequitable level of taxation and regulation on new housing are all deterrents to households entering the new home market as opposed to existing property.“All these supply-side obstacles require urgent attention or Australia’s chronic housing shortage will worsen and we will, perversely, see more upward pressure on interest rates than would otherwise be the case.Dale said there was an unjustifiably low level of finance being extended to small residential developers and this needed to be addressed. –AAP
Chapman Freeborn to move LNG cargo
By YEHIURA HRIEHWAZI in Brisbane
ONE of the world’s largest air chartering companies, Chapman Freeborn, has entered into partnership with the national flag carrier, Air Niugini, to move construction cargo for the PNG liquefied natural gas (LNG) project.Chapman Freeborn has 32 offices in 22 countries and last year alone, it co-ordinated 5,000 charters, according to a statement on its website.One of the aircraft being offered for use in the project is a large L-100 Hercules aircraft – one similar to the two from South America that were in joint-venture with Nationair in the mid-1980s to move cargo from Nadzab to Moro for the construction of the Kutubu oil fields and oil pipeline to the Kumul Marine Terminal in the Gulf province.The cargo handling facilities are already available at Nadzab and it has anticipated that most of the PNG LNG construction cargo for the Southern Highlands will be airlifted out of Nadzab to Tari, Komo and Moro. The arrangement will provide Air Niugini with access to the international cargo charter market, allowing the airline to offer its clients freighter aircraft from third party operators managed by Chapman Freeborn.Through the new venture, shippers and forwarders will be offered a one-stop shop for project cargo with main deck charter solutions to Port Moresby International Airport and onward connections to smaller airfields and unpaved strips across PNG.Clients will also be able to utilise Air Niugini’s cargo capacity on their current scheduled passenger aircraft which offer the greatest frequency into the country.The aircraft offer to the market included the highly capable L-100 Hercules which will be utilised to service specialised high altitude airstrips, to assist with the logistics relating to the development of a major LNG project and to supplement domestic cargo operations by Air Niugini’s Dash 8 freighter aircraft.The L-100 Hercules is unequalled in its ability to lift up to 20 tonnes of cargo from unprepared and short airstrips.Chapman Freeborn and Air Niugini are also studying a niche regional freighter for some of the smaller loads required in the country.Shahe Ouzounian, Chapman Freeborn’s chief operating officer, said:“We’re delighted that Air Niugini has chosen Chapman Freeborn as their partner in this venture.“I’m confident that with their regional capabilities and unparalleled local knowledge, combined with our global expertise, together we will help to further unlock Papua New Guinea’s potential for shippers and forwarders worldwide.“We are very pleased that this partnership allows the national carrier of Papua New Guinea to be an integral part of the air logistics involved in the LNG project in the country and we are proud of our association with Air Niugini.”Air Niugini will, in turn, benefit from working in partnership with the world’s leading aircraft charter company.Chapman Freeborn has a reputation for innovation, expertise and professionalism built up over 36 years.
ONE of the world’s largest air chartering companies, Chapman Freeborn, has entered into partnership with the national flag carrier, Air Niugini, to move construction cargo for the PNG liquefied natural gas (LNG) project.Chapman Freeborn has 32 offices in 22 countries and last year alone, it co-ordinated 5,000 charters, according to a statement on its website.One of the aircraft being offered for use in the project is a large L-100 Hercules aircraft – one similar to the two from South America that were in joint-venture with Nationair in the mid-1980s to move cargo from Nadzab to Moro for the construction of the Kutubu oil fields and oil pipeline to the Kumul Marine Terminal in the Gulf province.The cargo handling facilities are already available at Nadzab and it has anticipated that most of the PNG LNG construction cargo for the Southern Highlands will be airlifted out of Nadzab to Tari, Komo and Moro. The arrangement will provide Air Niugini with access to the international cargo charter market, allowing the airline to offer its clients freighter aircraft from third party operators managed by Chapman Freeborn.Through the new venture, shippers and forwarders will be offered a one-stop shop for project cargo with main deck charter solutions to Port Moresby International Airport and onward connections to smaller airfields and unpaved strips across PNG.Clients will also be able to utilise Air Niugini’s cargo capacity on their current scheduled passenger aircraft which offer the greatest frequency into the country.The aircraft offer to the market included the highly capable L-100 Hercules which will be utilised to service specialised high altitude airstrips, to assist with the logistics relating to the development of a major LNG project and to supplement domestic cargo operations by Air Niugini’s Dash 8 freighter aircraft.The L-100 Hercules is unequalled in its ability to lift up to 20 tonnes of cargo from unprepared and short airstrips.Chapman Freeborn and Air Niugini are also studying a niche regional freighter for some of the smaller loads required in the country.Shahe Ouzounian, Chapman Freeborn’s chief operating officer, said:“We’re delighted that Air Niugini has chosen Chapman Freeborn as their partner in this venture.“I’m confident that with their regional capabilities and unparalleled local knowledge, combined with our global expertise, together we will help to further unlock Papua New Guinea’s potential for shippers and forwarders worldwide.“We are very pleased that this partnership allows the national carrier of Papua New Guinea to be an integral part of the air logistics involved in the LNG project in the country and we are proud of our association with Air Niugini.”Air Niugini will, in turn, benefit from working in partnership with the world’s leading aircraft charter company.Chapman Freeborn has a reputation for innovation, expertise and professionalism built up over 36 years.
Sunday, March 28, 2010
Indian group eyes LNG slot
Source:
By YEHIURA HRIEHWAZI in Brisbane
INDIA’s state-owned oil and gas company Gail India Ltd is considering to join InterOil Corp to develop the second LNG plant in PNG.InterOil office in Port Moresby yesterday confirmed that the company is in discussions with Gail.“Yes, InterOil is in talks with Gail, but we do not comment on discussions until any transaction is complete,” spokesman on behalf of CEO and chairman Phil Mulacek said.Gail’s chairman and managing director BC Tripathi made the announcement during a sideline press conference where a regional gas conference is in progress this week.It received wide coverage by local media including the Calcutta Daily Telegraph and major financial websites like Bloomberg and Dow Jones.He said Gail was planning to invest in gas infrastructure globally and is looking at projects in Papua New Guinea, Nigeria, Ghana and Egypt.“We are examining the possibility of having a stake in the Papua New Guinea LNG terminal,” Tripathi told reporters.The state-owned firm is talking to Canadian firm InterOil Corp to buy a stake in its proposed liquefied natural gas project (LNG) in Papua New Guinea.“In Nigeria, we, along with partners Total and Shell, have been shortlisted as one of the companies to develop the Nigeria gas master plan worth about US$7 billion (K`19.4 billion),” he said.Nigeria is estimated to hold 184 trillion cubic feet of gas reserves, most of which remain unexplored.The short-listed companies would be invited to build three major gas gathering plants and pipelines that would supply fuel to power firms.Tripathi said: “In Ghana, we are talking. Once gas production starts, we will process the gas and transport it to the desired location.”The firm has a presence in city gas distribution projects in Egypt and China.“We are also exploring the possibility of expanding our city gas operations in Egypt,” Tripathi said.
By YEHIURA HRIEHWAZI in Brisbane
INDIA’s state-owned oil and gas company Gail India Ltd is considering to join InterOil Corp to develop the second LNG plant in PNG.InterOil office in Port Moresby yesterday confirmed that the company is in discussions with Gail.“Yes, InterOil is in talks with Gail, but we do not comment on discussions until any transaction is complete,” spokesman on behalf of CEO and chairman Phil Mulacek said.Gail’s chairman and managing director BC Tripathi made the announcement during a sideline press conference where a regional gas conference is in progress this week.It received wide coverage by local media including the Calcutta Daily Telegraph and major financial websites like Bloomberg and Dow Jones.He said Gail was planning to invest in gas infrastructure globally and is looking at projects in Papua New Guinea, Nigeria, Ghana and Egypt.“We are examining the possibility of having a stake in the Papua New Guinea LNG terminal,” Tripathi told reporters.The state-owned firm is talking to Canadian firm InterOil Corp to buy a stake in its proposed liquefied natural gas project (LNG) in Papua New Guinea.“In Nigeria, we, along with partners Total and Shell, have been shortlisted as one of the companies to develop the Nigeria gas master plan worth about US$7 billion (K`19.4 billion),” he said.Nigeria is estimated to hold 184 trillion cubic feet of gas reserves, most of which remain unexplored.The short-listed companies would be invited to build three major gas gathering plants and pipelines that would supply fuel to power firms.Tripathi said: “In Ghana, we are talking. Once gas production starts, we will process the gas and transport it to the desired location.”The firm has a presence in city gas distribution projects in Egypt and China.“We are also exploring the possibility of expanding our city gas operations in Egypt,” Tripathi said.
Thursday, March 25, 2010
Flying high in Asia-Pacific
Source:
By PATRICK TALU
By PATRICK TALU
PORT Moresby’s Jackson International Airport will be expanded and upgraded into an international-class aviation facility in the Asia-Pacific region.The development is estimated to cost K1.4 billion.The airport expansion follows pressures from the liquefied natural gas (LNG) project, which will increase passenger and aircraft traffic volume into and out of Port Moresby tremendously.National Airport Corporation (NAC) managing director Joseph Kintau yesterday accepted the Port Moresby International Airport (PMIA) master plan from Jacobs Consultancy.Mr Kintau said the current demand for aviation services had put a strain on the existing facilities. “The LNG project, expansions by airlines and booming economic activities are factors that forced us to come up with the plan to raise the airport’s standards to meet the expectations of the air industry,” Mr Kintau said.“The airport is also strategically located in the region where LNG project developers and consumers from the United States, Europe and Asia can have a convenient transit and exit from Port Moresby to other destinations.”He said the current airport, constructed in 1989, was designed to serve an annual capacity of 300,000 passengers.“After 20 years, we are now serving 1.4 million passengers a year.“That’s a significant strain on the airport’s facilities and infrastructure.”Highlighting one of the key objectives of the organisation’s reforms, Mr Kintau said the 2010 project was to ensure infrastructure development was based on a comprehensive master plan which PMIA was giving priority.The plan covers the development of infrastructure and facilities over the next 20 years – from 2010 to 2030.“It is based on passenger and aircraft movements’ forecast and growth in the aviation industry,” he added.Mr Kintau said the new airport would feature dual domestic and international terminals, extension of runways, redevelopment of apron and taxiways and also the commercial development of the aerodrome land.Asked how it would be implemented, he said: “The most probable implementation method NAC will be pursuing is a possible public-private partnership arrangement.“We are looking at a possible concession agreement to implement the capital programme to deliver the infrastructures, management capacity building and improved financial viability for regional airports through PMIA.”He said the plan also covered the scope of work and, after deliberation by the NAC board, it would be submitted to NEC for approval.
Wednesday, March 24, 2010
PNG LNG news fails to boost OSL shares
ALL the news about the financial close clearing the final hurdle for the PNG LNG project to go ahead might have excited the market, but it did little for the falling stocks of Oil Search Ltd on the local bourse.Oil Search lost 19toea to end at K13.80 despite the announcement in New York last Friday.On the local market this week, the Kina Securities Index (KSi) recovered slightly after declining for the past three weeks, Kina Securities said in its bulletin on Tuesday.It increased by 37.29 points or 0.60% to close at 6,231.60.The Kina Securities Home Index (KSHi) also gained strongly, gaining 217.88 points or 2.80% to close the week at 8,033.91.Bank South Pacific gained 1 toea, to end higher at K0.72.The company has released its annual financial report of 2009 which showed it has earned a net profit of K255.5 million for the year ending 31 Dec 31, 2009, up 11% from K228.3 million recorded in 2008.New Britain Oil surged 99t to close higher at 19.50, and Lihir Gold Limited closed 10t higher at K7.10. Another mining stock, HIG, was able to gain 10t to consolidate at 90t level.CCP was the remaining stock that fell, down 2t to close at K1.62. Other stocks remained unchanged.
Tuesday, March 16, 2010
Gas plan clears last hurdle
MELBOURNE: First production from the A$16 billion (K40.65 billion) Papua New Guinea liquefied natural gas project is on track to flow in 2014 after the development cleared its last financial hurdle with the signing of its final long-term sales agreement.The final deal converts an earlier agreement to a binding sales and purchase contract.Energy giant ExxonMobil, which has a 33.2% stake in the project and operates it via its subsidiary Esso Highlands Ltd, announced financial closure last Friday.“Finalising all sales and purchase agreements with LNG buyers and completing the financing arrangements with lenders are major milestones for the project,” Oil Search managing director Peter Botten said.Oil Search has a 29% stake in the project.“A total of US$14 billion (K38.89 billion) of debt funding has been secured for the project, with commitments from key export credit agencies, commercial banks and lending from co-venturers,” he said.“Securing this financing during one of the most difficult financial markets seen in modern history was a major achievement.”The project will supply four major LNG customers in Asia through long-term sales, including Taiwan’s CPC Corp, Osaka Gas Co Ltd and The Tokyo Electric Power Co, in Japan, and Unipec Asia Co Ltd, a subsidiary of China Petroleum and Chemical Corp (Sinopec).Partners in the PNG LNG project in December announced the US$15 billion (K41.67 billion) project would go ahead, conditional on sales and purchasing agreements being signed-off and finance being secured.Other partners include the PNG Government with 16.6%, Santos Ltd with 13.5%, Nippon Oil Exploration with 4.7%, PNG landowners, who hold 2.8%, and Petromin PNG Holdings Ltd, with 0.2%.The PNG LNG development includes gas production and processing facilities in the Southern Highlands and Western provinces of PNG, liquefaction and storage facilities north-west of Port Moresby on the Gulf of Papua, and over 700km of pipelines.Santos chief David Knox also praised the project’s financial completion.“PNG LNG will provide Santos with long-term production and cash flows,” Knox said in a statement.“Our share of project production is expected to be approximately nine million barrels of oil equivalent per annum at plateau including LNG and associated liquids,” he said.The existing sales and purchase agreements now account for all of PNG LNG’s production capacity of 6.6 million tonnes per year for 20 years from the start of production expected in 2014.Deutsche Bank analyst Damian Pearson said most investors had been expecting the final agreements to be signed-off.“It is all done and dusted, so that is good news,” Pearson said. – AAP
Sunday, March 14, 2010
LNG project lures public servants
Source:
By ZACHERY PER
AN exodus of highly-skilled public servants to the LNG project is being experienced as workers are quitting their jobs in search of greener pastures.Several public servants in Simbu province have attended interviews with developers of the project, according to president of the Public Employees Association Simbu branch Peter Nulai.He told The National in Kundiawa yesterday that there would be an acute shortage in public service workforce after an exit of several highly-skilled and experienced public servants.“The onus is on the Government to re-negotiate their remuneration packages to keep them serving the people at their current respective levels,” Mr Nulai said.He said public servants not only in Simbu province but also other provinces and in the National Government were opting to join the LNG work force.“Most of those who expressed interests to work in the project are likely to leave public service as so much money is involved.“The Government will make millions of kina because of the LNG projects, so they should increase the salaries and improve working and living conditions of its workers to keep them in the public service,” Mr Nulai said.It has been revealed that PNG lacked the manpower capacity for the LNG project to start and developers were looking at recruiting skilled manpower overseas to meet the requirement of the project.
By ZACHERY PER
AN exodus of highly-skilled public servants to the LNG project is being experienced as workers are quitting their jobs in search of greener pastures.Several public servants in Simbu province have attended interviews with developers of the project, according to president of the Public Employees Association Simbu branch Peter Nulai.He told The National in Kundiawa yesterday that there would be an acute shortage in public service workforce after an exit of several highly-skilled and experienced public servants.“The onus is on the Government to re-negotiate their remuneration packages to keep them serving the people at their current respective levels,” Mr Nulai said.He said public servants not only in Simbu province but also other provinces and in the National Government were opting to join the LNG work force.“Most of those who expressed interests to work in the project are likely to leave public service as so much money is involved.“The Government will make millions of kina because of the LNG projects, so they should increase the salaries and improve working and living conditions of its workers to keep them in the public service,” Mr Nulai said.It has been revealed that PNG lacked the manpower capacity for the LNG project to start and developers were looking at recruiting skilled manpower overseas to meet the requirement of the project.
Gas project gets financiers’ nod
BANKS and financial institutions have given the thumbs up for the PNG liquefied natural gas (LNG) project to get rolling.The financing arrangement was concluded in New York last Friday, clearing the final hurdle for this massive project.In financing terms, this is the biggest oil or gas project ExxonMobil has undertaken on its own.ExxonMobil and its partners were successful in negotiating this huge financing at a time when the financial crisis has weakened the global economy, and this represents a big plus for PNG.Prime Minister Sir Michael Somare congratulated project operator Esso Highlands Limited for successfully concluding the financial arrangements that enabled the US$15 billion (K40 billion) project to proceed.The conclusion of the sale and purchase agreements with four Asian LNG customers recently and the completion of financing arrangements represent a major milestone in the Government’s ongoing efforts to build a vibrant economy, he said in a statement.He said projections suggested that company tax proceeds from this project would average between K5 billion and K7 billion annually during the 30-year life of the project.Sir Michael said ExxonMobil had advised the Government that the LNG project financing agreement represented the biggest loan funding ever provided for any oil or gas project worldwide.“This is indeed a big honour for our nation. I call on all stakeholders to join hands in ensuring smooth progress during project construction to enable the LNG export operation to be commissioned by the end of 2013.”Esso Highlands Ltd managing director Peter Graham and ExxonMobil Development Company president Neil Duffin said: “The project will be developed in compliance with the highest standards for health, safety, environmental and social safeguards and will support the PNG Government’s objective to strengthen its economy and infrastructure base for the benefit of its people.“The comprehensive national content plan focuses on development of the local workforce, expansion of supplier capability, and strategic community investment.“Funding for the PNG LNG project will come from the co-partners and through market-rate loans arranged with export credit agencies and commercial sources. The project team successfully negotiated this complex transaction for the project in a very difficult financial market.”The concluded financing arrangements comes just 10 days after project partners led by operator Esso Highlands Ltd signed off the last final 20-year sale and purchase agreement (SPA) with China Petroleum Company (CPC) Taiwan for about 1.2 million tonnes per annum (mta) of LNG.
Extra profit tax on LNG project
THE additional profit tax has been reintroduced in the PNG liquefied natural gas (LNG) project, according to Prime Minister Sir Michael Somare.The tax scheme was abandoned in early 2003.During negotiations between the National Government and project developer ExxonMobil Corp on the PNG Gas agreement, the Government did not provide any tax concessions, Sir Michael said.He said this in a statement as he expressed congratulatory sentiments to ExxonMobil Corp and project development partners led by operator Esso Highlands Ltd, a subsidiary of ExxonMobil Corp.“We have had positive economic growth every year since then and I am especially thankful that the PNG LNG project will push this nation’s economic performance to an even higher level.“The challenge for my Government is to convert the benefits of this project to meaningful development that would improve the lives and living conditions of every Papua New Guinean.“The co-venturers in this project will spend US$15 billion (K40 billion) during construction.“This has to be managed in an effective and efficient manner to avoid cost blow outs that would negatively impact on profitable operations and potential returns to the National Government,” he said.The Independent Public Business Corp (IPBC) through its subsidiary company Kroton No. 2, is State’s nominee to venture into the project on behalf of the GovernmentIn total, the Government has 19.6% equity stake in the project, where 16.6% is held by IPBC (Kroton No. 2); an additional 2.8% is held on behalf of landowners by the Mineral Resources Development Co (MRDC); and 0.2% by Petromin PNG Holdings Ltd through its subsidiary Eda Oil Ltd.The overall US$15 billion (K40 billion) cost of developing the PNG LNG project, which excludes shipping costs, will enable PNG to export 6.6 million tonnes of LNG annually to customers in China, Japan and Taiwan.This would involve the processing of more than nine billion cubic feet of natural gas from gas fields in Southern Highlands and Western province over the 30-year project life.
BSP records net profit of K255.5 million
BANK South Pacific (BSP) has recorded a net profit of K255.5 million for the period ending Dec 31, 2009, up 11% from K228.3 recorded in 2008.Its consolidated operating profit (before tax) was K378.1 million for Dec 31, up 15% from K328.8 million in 2008.BSP chairman Noreo Beangke, in the announcement to Port Moresby Stock Exchange, said last year’s results reflected moderate but reasonably stable and resilient business conditions during the year, as some effects of the global financial crisis became more directly apparent in the economy.The group’s total assets last year was K9,398.7 million, a hefty 38% increase of K2,590.8 million from K6,807.9 million in 2008.While this growth reflected continuing organic business growth in the bank of just over K1,160 million in PNG and its Pacific Island branches, Mr Beangke made special mention of the achievement.He noted that during a time of general tentativeness in the global business environment, BSP added a further K1,430 million of assets (along with 18 bank branches) through the acquisition of the National Bank of Fiji and Colonial Fiji Life Ltd last November, clearly underlining the bank’s expansion strategy in the Pacific region.He said BSP maintained its strong performance last year.
Oro oil palm growers to hike output
Source:
By SHEILA LASIBORI
OIL Palm growers in Oro province aim to produce 180,000 tonnes of fruit this year, following last year’s low output, according to the Popondetta Oil Palm Industries Corp (Opic).Last year, the growers harvested only 130,000 tonnes out of the targeted 170,000 tonnes, mainly due to the devastation caused by Cyclone Guba in 2007 where about 98ha of oil palm land was lost, Graydon Hanguru, field manager for Opic, said.He said another reason for the low harvest was the non-distribution of fertilisers to growers since 2007.That year, about a third of the growers were supplied fertilisers, then there was nothing for both 2008 and last year.This year, they have restarted distributing fertilisers where three divisions (Sorovi, Igora, and Ilimo) have been covered with the remaining two divisions to be supplied soon.The price per tonne of the harvest this year has been: January, K191.90/t; February, K194.58/t; and this month, K211.33/t.Mr Hanguru said the way in which growers were paid their cheques had been changed to avoid long queues at the only bank (Bank South Pacific).There was an inflow of people into Popondetta who emptied shelves in shops, he said.“This was a big change we did to reschedule the harvest time and the day for issing cheques to the growers,” he said yesterday.The growers were grouped into two zones: Zone one consisted of Sorovi, Saiho, and Ilimo which started the first harvest on Jan 4 and got their cheques the following Friday.Zone Two (Igora and Aeka) followed suit which harvested on Jan 11 and received their cheques the following Friday.“So what is happening now is that we are trying to get them to harvest according to their schedules … we are paying them every Friday,” Mr Hanguru said.He also said the Asian Development Bank -funded smallholder agriculture development project (SADP), or the in-filling project, was two years behind schedule.“It is an in-filling project and not a new development,” he said, adding they were preparing for SADP.So far, it had recruited lands and environment officers who were currently undergoing basic training at Hoskins in West New Britain province.
By SHEILA LASIBORI
OIL Palm growers in Oro province aim to produce 180,000 tonnes of fruit this year, following last year’s low output, according to the Popondetta Oil Palm Industries Corp (Opic).Last year, the growers harvested only 130,000 tonnes out of the targeted 170,000 tonnes, mainly due to the devastation caused by Cyclone Guba in 2007 where about 98ha of oil palm land was lost, Graydon Hanguru, field manager for Opic, said.He said another reason for the low harvest was the non-distribution of fertilisers to growers since 2007.That year, about a third of the growers were supplied fertilisers, then there was nothing for both 2008 and last year.This year, they have restarted distributing fertilisers where three divisions (Sorovi, Igora, and Ilimo) have been covered with the remaining two divisions to be supplied soon.The price per tonne of the harvest this year has been: January, K191.90/t; February, K194.58/t; and this month, K211.33/t.Mr Hanguru said the way in which growers were paid their cheques had been changed to avoid long queues at the only bank (Bank South Pacific).There was an inflow of people into Popondetta who emptied shelves in shops, he said.“This was a big change we did to reschedule the harvest time and the day for issing cheques to the growers,” he said yesterday.The growers were grouped into two zones: Zone one consisted of Sorovi, Saiho, and Ilimo which started the first harvest on Jan 4 and got their cheques the following Friday.Zone Two (Igora and Aeka) followed suit which harvested on Jan 11 and received their cheques the following Friday.“So what is happening now is that we are trying to get them to harvest according to their schedules … we are paying them every Friday,” Mr Hanguru said.He also said the Asian Development Bank -funded smallholder agriculture development project (SADP), or the in-filling project, was two years behind schedule.“It is an in-filling project and not a new development,” he said, adding they were preparing for SADP.So far, it had recruited lands and environment officers who were currently undergoing basic training at Hoskins in West New Britain province.
Gas project ‘enormous challenge’
BEING a massive project in a small economy, the PNG liquefied natural gas concern has become an enormous challenge.And the usual trouble with a big resource project for a small economy is that if the revenue is not carefully managed, the project could end up giving very little to boost the domestic economy’s growth, Roger Donnelly, chief economist of EFIC said on Wednesday.The International Monetary Fund (IMF) has estimated that the project would increase gross domestic product (GDP) by 15% to 20% and the national income by 6%.Mr Donnelly was speaking in Port Moresby during the economic outlook seminar.The event is part of a series of activities marking the Australia week 2010.Also present was Bank of PNG Governor Loi Bakani and Australian High Commissioner to PNG Ian Kemish.Mr Donnelly, who claimed to have been watching the changes in the PNG economy over a decade, said PNG’s record showed it did not have a good track record for growth despite having some of the biggest resource projects.“Now, there is no reason in principle why resource wealth should keep you poor,” he said this as he acknowledged that the PNG Government was aware of those issues and responded with the medium-term fiscal strategy.
InterOil profit US$6.1m
INTEROIL Corp recorded net profit of US$6.1 million (K17 million) as against a net loss of US$11.8 million (K32 million) for the same period in 2008.The company said it was its first posting of annual profit.Profits from InterOil’s refining and distribution businesses more than offset losses incurred in its developing upstream and liquefaction businesses.This profit figure for the period ending Dec 31 included a significant expense item amounting to US$31.7 million (K87 million) for a “loss on extinguishment of indirect participation interest liability”.This relates to an exchange transaction entered into with certain indirect participation interest (IPI) holders when their interests were exchanged for a certain number of InterOil’s common shares.InterOil petroleum products sold in PNG totalled 6.5 million barrels for fiscal year last year compared with 6.6 million barrels in 2008, a steady result in light of the global economic backdrop.Total revenue last year was US$693.1 million (K1.904 billion), compared with US$919.7 million (K2.527 billion) for 2008.“The difference is primarily explained by lower crude oil prices, giving rise to commensurately lower product pricing in the current year,” InterOil said in a statement.InterOil’s earnings before interest taxes, depreciation and amortisation (Ebitda) for the year was US$19.3 million (K53 million), down US$3.1 million (K9 million) from US$22.4 million (K62 million) in 2008.This Ebitda figure would be US$51 million (K140 million) if the US$31.7 million (K87 million) ‘loss on extinguishment’ of the IPI liability was excluded.
TWL offering 35% of equity in company
Source:
By SHEILA LASIBORI
SOUTHERN Highlands-based transport company Trans Wonderland Ltd (TWL) is offering an un-acquired 35% equity to landowner companies (lancos), according to managing director Larry Andagali.So far, 65% have being taken up by existing lancos, the latest being Moran Ina Naga Ltd, which paid K240,000 for its 10% equity share covering areas in petroleum development licence (PDL) 5 and 6 (each have 5% interest in the purchase).Witnessed by some company directors, Moran chairman Tony Kila made the cheque payment to Mr Andagali on Tuesday night in Port Moresby during the deal signing between Hides Gas Development Corp (HGDC) and Business for Millennium Development (B4MD).TWL, which started operating last June but formally launched only in July, has 21 earth-moving equipment to date from the initial 17 and employees over 120 staff.According to Mr Andagali, the Moro-based company with offices in Lae for LNG cargo coordination will go into shipping and aviation.“TWL will also move into aviation and shipping … we are having discussions and are still working on it,” he said, adding with the support of Moran and other lancos, they would reach their investment goals. “So everyone in Hides, Kutubu and Moran we still have 35% that is available,” he said as he called on landowners in areas along the LNG pipeline, Angore, Juha, Komo airfield, PDL 1 and 5 to form their companies and buy shares in TWL.Mr Andagali said starting from Moran at the border of PDL 6 into Juha, Angore and Hides would take up 50% in TWL while Kutubu, Upper Foe and Lower Foe including Poroma access road landowners would own the other 50%.He said TWL was also working with Gobe and Kikori landowners who owned a transport company.“We are in discussions for a joint venture tie-up to provide transportation services from Kopi all the way to Hides so there is no interruption.“TWL is to be one-stop-shop transport and logistics company we are working towards that aim to build up to 100-300 truck-fleet but working towards 100 trucks,” he said.TWL’s six-monthly meeting for shareholders is due this month end.
By SHEILA LASIBORI
SOUTHERN Highlands-based transport company Trans Wonderland Ltd (TWL) is offering an un-acquired 35% equity to landowner companies (lancos), according to managing director Larry Andagali.So far, 65% have being taken up by existing lancos, the latest being Moran Ina Naga Ltd, which paid K240,000 for its 10% equity share covering areas in petroleum development licence (PDL) 5 and 6 (each have 5% interest in the purchase).Witnessed by some company directors, Moran chairman Tony Kila made the cheque payment to Mr Andagali on Tuesday night in Port Moresby during the deal signing between Hides Gas Development Corp (HGDC) and Business for Millennium Development (B4MD).TWL, which started operating last June but formally launched only in July, has 21 earth-moving equipment to date from the initial 17 and employees over 120 staff.According to Mr Andagali, the Moro-based company with offices in Lae for LNG cargo coordination will go into shipping and aviation.“TWL will also move into aviation and shipping … we are having discussions and are still working on it,” he said, adding with the support of Moran and other lancos, they would reach their investment goals. “So everyone in Hides, Kutubu and Moran we still have 35% that is available,” he said as he called on landowners in areas along the LNG pipeline, Angore, Juha, Komo airfield, PDL 1 and 5 to form their companies and buy shares in TWL.Mr Andagali said starting from Moran at the border of PDL 6 into Juha, Angore and Hides would take up 50% in TWL while Kutubu, Upper Foe and Lower Foe including Poroma access road landowners would own the other 50%.He said TWL was also working with Gobe and Kikori landowners who owned a transport company.“We are in discussions for a joint venture tie-up to provide transportation services from Kopi all the way to Hides so there is no interruption.“TWL is to be one-stop-shop transport and logistics company we are working towards that aim to build up to 100-300 truck-fleet but working towards 100 trucks,” he said.TWL’s six-monthly meeting for shareholders is due this month end.
Mitsui wins gas plan deals
THE PNG liquefied natural gas (LNG) project has awarded Japanese transport company Mitsui OSK Lines Ltd (MOL) two long-term charters.The charters are for MOL’s two existing 177,000 cubic meter capacity LNG carriers with the state-of-the-art tri-fuel-diesel electric propulsion systems built in Korea at Hyundai yards this year and co-owned by Itochu Corp (Itochu) (MOL 70% and Itochu 30%).The vessels are to be operated by MOL.Simultaneously, MOL has entered into two heads of agreement, one with the PNG LNG project and one with an ExxonMobil affiliated company in the Gorgon project. Here, MOL will construct and long-term charter a total of four LNG vessels to the projects, all of which are planned to be built in China.Deliveries will start in 2014-16 timeframe.According to the statement, MOL has a proven track record of providing first class transportation for large scale LNG projects in the Asia Pacific and Middle East regions for over 30 years.MOL also acknowledged ExxonMobil for their long association and their affiliates and joint ventures and was looking forward to working with them and their partners in the years ahead.
Steamships: Final dividend K0.86
THE board of Steamships Trading Co Ltd (STCL) has declared a final dividend of K0.86 per share and will be paid following approval at the company’s annual general meeting scheduled for May 25 this year.This brings the total dividend for the year to K1.46 per share which was the same as 2008.STCL board said the current strategic investment plans for the next three years would need a reduction in annual dividends to an estimated K1 (100 toea) per annum – interim K0.40 and final K0.60.“This will be reviewed throughout the year in response to the company’s operating performance and capital growth needs”, STCL board advised in its report to the stock exchange last Monday.STCL recorded profit (after tax and minority interests) of K96.6 million for the period ending December 2009, up 7% from K90.2 million in 2008, on the back of healthy performance by businesses within the Steamships group, especially hotels and the property division.
€22m for mgt of resources in the region
THE management of fisheries and mineral resources in the Pacific region will benefit from €22 million (K82.92 million) that will be injected by the European Union (EU).This will go into three projects under the 10th European Development Fund (EDF).This follows the signing yesterday in Suva, Fiji, of the first three financing agreements under the regional indicative programme for the Pacific, financed through the 10th EDF.The agreements were signed by Wiepke van der Goot, head of delegation of the European Union for the Pacific in Fiji and Tuiloma Neroni Slade, secretary general of the Pacific Islands Forum Secretariat (PIFS) and the regional authorising officer.The three projects include:* Scientific support for the management of coastal and oceanic fisheries in the Pacific Islands region (SCICOFish);* Deep sea minerals in the Pacific Islands region: legal framework and resource management; and* Development of sustainable tuna fisheries in Pacific ACP countries phase two (DevFish )A total of €95 million (K358 million) has been committed by the European Commission (EC) for 2008-13 to develop new approach to strengthening regional economic integration and sustainable management of natural resources and the environment.Speaking at the signing ceremony, Slade thanked the EU for funding the three projects and its continued support to the Pacific region in implementing the Pacific Plan and the Forum Leaders determination of the regional development priorities.
Nasfund’s investment ‘a success’
Source:
By SHEILA LASIBORI
THE growth in membership, asset value, and equity portfolio of National Superannuation Fund Ltd (Nasfund) reflects the health of the local economy.Since Nasfund has mostly invested locally, it is least affected by the global financial crisis (GFC), according to joint chief executive Ian Tarutia.These were Mr Tarutia’s observations in an address before human resource officers and managers of Nasfund member-employer companies and organisations at a conference yesterday at Crowne Plaza in Port Moresby.While revealing the fund’s successes despite the GFC and the performance compared with similar funds in Australia, Mr Tarutia again cautioned that employee members’ credit interest figure may not be a double digit this year, but all the rates except for 2008 (11%) had been above the inflation rates.The average for the last five years in interest credited to members was 19.8%.‘The growth here, as you can see the fund, has been growing with new members coming through.“When we grow, it is the reflection of what is happening in our economy,” he said.He said the active membership base had grown especially when new workers were being introduced into the workforce and hence, that captured in the superannuation where Nasfund captured some of them especially in the private sector.In equity portfolio, Mr Tarutia said Nasfund had good partnership with reputable organisations such as Curtain Brothers for developments at Harbour City in Port Moresby, Honibooks for construction of Investment Promotion Authority (IPA) House and the Factory at Konedobu, and Lamana Development for Heritage Hotel in Solomon Islands.“So we are using good reputable builders and contractors that are also owned by the fund, so investment money is circulated within the group,” he said.Meanwhile, Anna Mawason, the team leader for employer services, told the employer member- representatives to continue the employer contributions and on time especially after the 14th day of each month for the previous month’s contributions.
By SHEILA LASIBORI
THE growth in membership, asset value, and equity portfolio of National Superannuation Fund Ltd (Nasfund) reflects the health of the local economy.Since Nasfund has mostly invested locally, it is least affected by the global financial crisis (GFC), according to joint chief executive Ian Tarutia.These were Mr Tarutia’s observations in an address before human resource officers and managers of Nasfund member-employer companies and organisations at a conference yesterday at Crowne Plaza in Port Moresby.While revealing the fund’s successes despite the GFC and the performance compared with similar funds in Australia, Mr Tarutia again cautioned that employee members’ credit interest figure may not be a double digit this year, but all the rates except for 2008 (11%) had been above the inflation rates.The average for the last five years in interest credited to members was 19.8%.‘The growth here, as you can see the fund, has been growing with new members coming through.“When we grow, it is the reflection of what is happening in our economy,” he said.He said the active membership base had grown especially when new workers were being introduced into the workforce and hence, that captured in the superannuation where Nasfund captured some of them especially in the private sector.In equity portfolio, Mr Tarutia said Nasfund had good partnership with reputable organisations such as Curtain Brothers for developments at Harbour City in Port Moresby, Honibooks for construction of Investment Promotion Authority (IPA) House and the Factory at Konedobu, and Lamana Development for Heritage Hotel in Solomon Islands.“So we are using good reputable builders and contractors that are also owned by the fund, so investment money is circulated within the group,” he said.Meanwhile, Anna Mawason, the team leader for employer services, told the employer member- representatives to continue the employer contributions and on time especially after the 14th day of each month for the previous month’s contributions.
Tuesday, March 2, 2010
LNG plan offers farmers new deal
Source:
By SHEILA LASIBORI
THE new roads and airstrips being constructed for the PNG liquefied natural gas (LNG) project will give market access to primary agriculture produce.But a lot of the hard work will be done by local Papua New Guineans, according to Mark Ingram, chief executive of Business for Millennium Development (B4MD).Last night in Port Moresby, B4MD signed a deal with Hides Gas Development Corp (HGDC), a landowner company.“What the LNG project provides is a way to finally get market access … so with market accesses ,you can now create an economy for the people.“The benefit of profits will go directly to the farmers.”HGDC chairman Libe Parindali and Mr Ingram signed the deal targeting women and children in resource-rich Southern Highlands.It paves way for the creation of Southern Highlands Produce Ltd, a joint venture between B4MD and landowners.Mr Ingram also said: “Southern Highlands Produce brings together a group of Australian international companies working in partnership with the communities of Southern Highlands to create a community based fresh produce company”.Oil Search managing director Peter Botten acknowledged B4MD for its efforts and others who wanted to help and contribute to dealing with millennium development goals (MDGs).Oil Search is a member of B4MD and it will help seek seed capital for SHP-based produces.Under the arrangement B4MD would provide necessary expertise, tools and support for SHP from various members to assist with the running of the company.
By SHEILA LASIBORI
THE new roads and airstrips being constructed for the PNG liquefied natural gas (LNG) project will give market access to primary agriculture produce.But a lot of the hard work will be done by local Papua New Guineans, according to Mark Ingram, chief executive of Business for Millennium Development (B4MD).Last night in Port Moresby, B4MD signed a deal with Hides Gas Development Corp (HGDC), a landowner company.“What the LNG project provides is a way to finally get market access … so with market accesses ,you can now create an economy for the people.“The benefit of profits will go directly to the farmers.”HGDC chairman Libe Parindali and Mr Ingram signed the deal targeting women and children in resource-rich Southern Highlands.It paves way for the creation of Southern Highlands Produce Ltd, a joint venture between B4MD and landowners.Mr Ingram also said: “Southern Highlands Produce brings together a group of Australian international companies working in partnership with the communities of Southern Highlands to create a community based fresh produce company”.Oil Search managing director Peter Botten acknowledged B4MD for its efforts and others who wanted to help and contribute to dealing with millennium development goals (MDGs).Oil Search is a member of B4MD and it will help seek seed capital for SHP-based produces.Under the arrangement B4MD would provide necessary expertise, tools and support for SHP from various members to assist with the running of the company.
PNG, Taiwan ink LNG deal
THE PNG liquefied natural gas (LNG) project has signed off its last 1.2 million tonnes per annum (mta) of LNG to China Petroleum Co PNG-Taiwan LNG deal Esso Highlands Ltd, operator of the US$15 billion (K40 billion) LNG project, signed the 20-year sales deal with the Asia-Pacific LNG customer, last of the four LNG customers for the total 6.6mta to be produced when the project exports its first cargo in late 2014 or early 2015. Esso Highlands Ltd is a subsidiary of ExxonMobil Corp.“This important agreement with CPC will deliver a reliable supply of cleaner-burning natural gas to meet Taiwan’s growing energy demand and begin a new and lasting relationship between Taiwan’s largest energy importer and PNG’s first LNG project,” Ron Billings, vice president, LNG, ExxonMobil gas and power marketing, said.Second major partner Oil Search Ltd’s managing director Peter Botten said: “The PNG LNG project is now fully contracted for the entire plant capacity, and the way is clear to move forward to financial close.”Mr Billings said: “It also marks a significant step forward for the PNG LNG project. With this SPA, all of the project’s production capacity has been committed on a long-term basis.
Steamships posts K96m profit for 2009
STEAMSHIPS Trading Co Ltd (STCL) posted a profit (after tax and minority interests) of K96.6 million for the period ending December 2009.The directors in their report to the stock exchange revealed the profit, up 7% from K90.2 million in 2008, on the back of healthy performance by businesses within the Steamships group especially the hotels and property division.This figure includes Steamships’ equity-accounted share of associates’ results.Revenues were K496.0 million, up 7.1% compared to 2008 result of K463.0 million.Depreciation in 2009 was K47.9 million compared to K39.3 million in the previous year, and interest on borrowings was K12.2 million against K4.7 million in 2008.Capital expenditure for the year was K195.4 million against K133.7 million in 2008.“The result reflects the continuing improvement in trading performance from businesses within the Group.Notably, the hotels and property divisions recorded healthy results against budget expectations.“This is largely driven by increased demand for short-term stays and conferencing. “Room and facility expansion at the Gateway and Ela Beach Hotels together with the construction of the new 166-room Grand Papua Hotel, in Port Moresby, ensures the divisions’ position as a leading hospitality service provider.”The board said demand for high quality commercial, industrial and residential accommodation drove favourable results for the property division and reinforced investment decisions to commence property development programmes.
Govt backs Petromin on LNG plan
PRIME Minister Sir Michael Somare has said the Government and its agencies will work with Petromin PNG Holdings Ltd in the Elk/Antelope liquefied natural gas (LNG) project.This will be to help Petromin, the Government’s nominee, fund the State’s equity in the project being spearheaded by InterOil Corp.Sir Michael disclosed these during the Petromin Board meeting in Wewak last where he addressed the meeting as trustee shareholder.He said he was looking forward to receiving Petromin’s advice on how the State could best fund its equity in the project.The Prime Minister expressed satisfaction that Petromin had secured the financing of its equity, through its subsidiary Eda Oil Ltd in the Exxon Mobil-led PNG LNG project.“This indeed gives me more confidence that I have in the board and management in taking on more challenges of similar nature in the future, on the company’s own strength.”Sir Michael said Petromin has shown positive growth since its inception and he commended the board and management for putting in place an investment strategy which provided the pathway for a planned process of investment.“It is my hope that one day, Petromin would live up to its expectations of becoming an exploration and development company in the whole value chain of the mineral and petroleum sector.“It was this main vision that led us to create Petromin,” Sir Michael said.
Sunday, February 28, 2010
China surpasses Japan as the 2nd largest world economy
Hock's Viewpoint - By Choong Khuat Hock
China's growth and challenges
CHINA surpassed Japan as the second largest economy in the world in the fourth quarter of 2009.
Although Japan’s gross domestic product (GDP) for 2009 at US$5 trillion was higher than that of China at US$4.9 trillion, from the fourth quarter, China produced more goods and services (i.e. enjoyed higher GDP) than did Japan.
It still has some way to go before catching up with the United States, which had a GDP of US$14.5 trillion in 2009.
If China can grow 4% faster than the US annually, it is likely to surpass the US economy in 25-30 years. This could be sooner if the undervalued renminbi is revalued upwards.
Advantages
On a purchasing power parity (PPP) basis, which assumes similar cost for identical products and services in different countries, China overtook Japan in 2001 (see chart) and could overtake the US by 2020.
As per the International Monetary Fund, China’s GDP per capita in 2009 at only US$3,566 was still significantly lower than that of Japan (US$39,573) and the US (US$46,443).
Growing from a low base was the easy part; the challenge is to sustain growth when China becomes a middle income nation.
China has a few advantages that will help it sustain growth. First, it has a strong pro-growth government that can implement its plans.
In the past, such plans like the Great Leap Forward and the Cultural Revolution were socio-economic disasters but under the collective leadership structure, policies are more measured.
A strong government has enabled China to quickly modernise its infrastructure (unlike India) and enhance its strong position in certain sectors like renewable energy, steel and manufactured exports.
Second, China has a very large domestic market that enables domestic producers to achieve economies of scale and attract foreign direct investments and technology into the country.
Third, China has made good strides in education and research and development. According to Unesco, China’s share of global researchers rose to 20.1% from only 14% in 2002 (see table on the previous page).
Challenges
China also faces immense challenges. There is, firstly, an over-reliance on investments and exports to boost the economy while private consumption as a percentage of GDP remains low.
In the longer term, China will require a basic social net that will encourage Chinese to save less for future medical and other bills.
China’s strong one-party rule may be suitable for leading a country from a low to middle income nation but to make the leap to a high income nation requires a focus on innovation and a liberal environment that retains and attracts talent (like the US).
Taiwan and South Korea have made the transition from autocratic governments to democratic governments.
The challenge is for China to maintain stability and yet sufficiently relax its grip on its people to allow this transition.
Another challenge lies in how an emerging China interacts with the US and the Western world. Both sides will have to resolve tensions from differing world views and competition for natural resources and markets.
In the longer term, China faces a demographic time bomb due to its one child policy. China’s rapidly aging population is expected to peak at 1.45 billion in 2030 according to a UN study.
By then, China could suffer from what Japan is suffering now, a stagnant economy and a declining population that represents a strain on its healthcare and social welfare system.
China was the world’s richest nation until 1850, a position that was toppled by an inept government in the last days of the Manchu dynasty and unfair treaties imposed after the Opium War in 1842, aimed at reducing British trade deficit with China by selling opium to the Chinese in exchange for Chinese goods.
Barring major military conflicts (unlikely in the nuclear age) and major policy blunders, China is likely to resume its position as the world’s richest nation, a position it held for almost 2,000 years since the days of the Han Dynasty (206 BC–AD 220) which rivalled the Roman Empire.
The nature of the world will change as an emerging China interacts with a declining but still powerful West.
Western liberal democratic traditions focused on individual rights will square off with Eastern collectivist paradigm putting society above the individual.
Inter-Asian trade and relations will strengthen China’s influence in Asia and position the renminbi as the de facto trading currency for the Asian bloc.
Failure of China and the West in accommodating each other could lead to trade war and even a new cold war, an outcome that can be avoided if more moderate voices that value an open diverse world can prevail over xenophobic ultra-nationalistic/religious voices.
In this new global reality, Malaysia will find it increasingly difficult to compete in manufacturing. Malaysia has to fight tooth and nail to retain and attract talent and boost services (like tourism). This means crafting an attractive liberal environment for its citizens and foreign talent.
·Choong Khuat Hock is head of research at Kumpulan Sentiasa Cemerlang Sdn Bhd.
China's growth and challenges
CHINA surpassed Japan as the second largest economy in the world in the fourth quarter of 2009.
Although Japan’s gross domestic product (GDP) for 2009 at US$5 trillion was higher than that of China at US$4.9 trillion, from the fourth quarter, China produced more goods and services (i.e. enjoyed higher GDP) than did Japan.
It still has some way to go before catching up with the United States, which had a GDP of US$14.5 trillion in 2009.
If China can grow 4% faster than the US annually, it is likely to surpass the US economy in 25-30 years. This could be sooner if the undervalued renminbi is revalued upwards.
Advantages
On a purchasing power parity (PPP) basis, which assumes similar cost for identical products and services in different countries, China overtook Japan in 2001 (see chart) and could overtake the US by 2020.
As per the International Monetary Fund, China’s GDP per capita in 2009 at only US$3,566 was still significantly lower than that of Japan (US$39,573) and the US (US$46,443).
Growing from a low base was the easy part; the challenge is to sustain growth when China becomes a middle income nation.
China has a few advantages that will help it sustain growth. First, it has a strong pro-growth government that can implement its plans.
In the past, such plans like the Great Leap Forward and the Cultural Revolution were socio-economic disasters but under the collective leadership structure, policies are more measured.
A strong government has enabled China to quickly modernise its infrastructure (unlike India) and enhance its strong position in certain sectors like renewable energy, steel and manufactured exports.
Second, China has a very large domestic market that enables domestic producers to achieve economies of scale and attract foreign direct investments and technology into the country.
Third, China has made good strides in education and research and development. According to Unesco, China’s share of global researchers rose to 20.1% from only 14% in 2002 (see table on the previous page).
Challenges
China also faces immense challenges. There is, firstly, an over-reliance on investments and exports to boost the economy while private consumption as a percentage of GDP remains low.
In the longer term, China will require a basic social net that will encourage Chinese to save less for future medical and other bills.
China’s strong one-party rule may be suitable for leading a country from a low to middle income nation but to make the leap to a high income nation requires a focus on innovation and a liberal environment that retains and attracts talent (like the US).
Taiwan and South Korea have made the transition from autocratic governments to democratic governments.
The challenge is for China to maintain stability and yet sufficiently relax its grip on its people to allow this transition.
Another challenge lies in how an emerging China interacts with the US and the Western world. Both sides will have to resolve tensions from differing world views and competition for natural resources and markets.
In the longer term, China faces a demographic time bomb due to its one child policy. China’s rapidly aging population is expected to peak at 1.45 billion in 2030 according to a UN study.
By then, China could suffer from what Japan is suffering now, a stagnant economy and a declining population that represents a strain on its healthcare and social welfare system.
China was the world’s richest nation until 1850, a position that was toppled by an inept government in the last days of the Manchu dynasty and unfair treaties imposed after the Opium War in 1842, aimed at reducing British trade deficit with China by selling opium to the Chinese in exchange for Chinese goods.
Barring major military conflicts (unlikely in the nuclear age) and major policy blunders, China is likely to resume its position as the world’s richest nation, a position it held for almost 2,000 years since the days of the Han Dynasty (206 BC–AD 220) which rivalled the Roman Empire.
The nature of the world will change as an emerging China interacts with a declining but still powerful West.
Western liberal democratic traditions focused on individual rights will square off with Eastern collectivist paradigm putting society above the individual.
Inter-Asian trade and relations will strengthen China’s influence in Asia and position the renminbi as the de facto trading currency for the Asian bloc.
Failure of China and the West in accommodating each other could lead to trade war and even a new cold war, an outcome that can be avoided if more moderate voices that value an open diverse world can prevail over xenophobic ultra-nationalistic/religious voices.
In this new global reality, Malaysia will find it increasingly difficult to compete in manufacturing. Malaysia has to fight tooth and nail to retain and attract talent and boost services (like tourism). This means crafting an attractive liberal environment for its citizens and foreign talent.
·Choong Khuat Hock is head of research at Kumpulan Sentiasa Cemerlang Sdn Bhd.
IT firm MCR now here
Source:
By SHEILA LASIBORI
AN Australian information technology (IT) provider believes that the PNG liquefied natural gas project will increase income for many people who would now have better access to IT.And the nature of the LNG project will increase requirements for better network and more reliable systems, according to Harry Vakili, executive chairman of Australian IT company MCR.The corporate and Government IT needs will be the main focus of MCR, which will be based at Boroko in the coming weeks.“That is exactly what we are here for … better network and more reliable systems,” Mr Vakili said these shortly before the company launched its PNG office in Port Moresby last Friday alongside its executive partner Sun Microsystems Australia.Mr Vakili said MCR had an initial two-year plan and in the first three months, they would have about seven staff and in 12 months, aim to have about 15.“In two years time, we plan to have a daily centre here which could have about 100 to 150 people,” he said.Mr Vakili said there were two practices that MCR would focus on in line with the large projects being implemented in PNG.First was speed of the (IT) network, security of the flow of information around the network and quality.The second was reliable and mission critical business solutions.
By SHEILA LASIBORI
AN Australian information technology (IT) provider believes that the PNG liquefied natural gas project will increase income for many people who would now have better access to IT.And the nature of the LNG project will increase requirements for better network and more reliable systems, according to Harry Vakili, executive chairman of Australian IT company MCR.The corporate and Government IT needs will be the main focus of MCR, which will be based at Boroko in the coming weeks.“That is exactly what we are here for … better network and more reliable systems,” Mr Vakili said these shortly before the company launched its PNG office in Port Moresby last Friday alongside its executive partner Sun Microsystems Australia.Mr Vakili said MCR had an initial two-year plan and in the first three months, they would have about seven staff and in 12 months, aim to have about 15.“In two years time, we plan to have a daily centre here which could have about 100 to 150 people,” he said.Mr Vakili said there were two practices that MCR would focus on in line with the large projects being implemented in PNG.First was speed of the (IT) network, security of the flow of information around the network and quality.The second was reliable and mission critical business solutions.
Petromin leader in minerals devt: PM
PETROMIN (PNG) Holdings Ltd is emerging as a leader in developing its mineral tenements through green field exploration, Prime Minister Sir Michael Somare said yesterday.In an address to the Petromin board of directors, Sir Michael said he was pleased to learn that Petromin board and management have allocated about K6 million this year to explore the company”s mineral tenements within the vicinity of the Tolukuma gold mine in Central province, and regional tenements.“For a newly-established company, Petromin has done extremely well and can be seen as a leader in developing its tenements … than most of the junior mining companies that have been in the business for a much longer period.”Sir Michael said Petromin’s determined approach in upgrading the total resource potential of Tolukuma mine through an extensive exploration programme was proving successful for the company.“This exercise is paying off as the total resource has been upgraded by an independent Australianbased company to about 700,000oz.“This has the potential to extend the mine life to about five years.”Sir Michael spoke particularly on Petromin’s investment strategy.“I am pleased to note that the board and management have put in place an investment strategy which provides the pathway for a planned process of investment.“I am advised that the strategy was based on the State’s back-in-right as well as other investment opportunities that Petromin in its own right as an industry participant can invest in,” he said.
NBPOL posts lower profit
NEW Britain Palm Oil Ltd, a large-scale integrated industrial producer of sustainable palm oil in Papua New Guinea, has announced its unaudited preliminary results for the year ended Dec 31, 2009.The company posted a lower profit before tax of US$85.3 million (K234 million), down from the US$106.3 million (K291.63 million) earned in 2008. The amount however excluded the effect of revaluing biological assets.It disclosed that its revenue during the year in review dropped to US$323.8 million (K888.34 million) from US$352.2 million (K966.26 million) the previous year, due to lower prices for palm oil in 2009, particularly in the first half of the year as against the figure in 2008.Earnings per share of ordinary shareholders, were US$0.418, down from the US$0.518 declared in 2008.Dividends paid during the year in review totaled US$0.28 per share including an interim dividend for 2009 of US$0.14 per share.
Wednesday, February 24, 2010
Rural areas could be bird’s nests goldmine
LIMBANG: Rural areas could be a bird’s nests goldmine through the state government’s efforts to promote swiftlet rearing outside urban centres.Assistant Minister of Tourism and Heritage Datuk Talib Zulpilip said the industry has a bright future due to the lucrative returns and larger areas in villages to set up swiftlet nesting homes.
“The swiftlet industry has shifted out of town now and there is growing potential to expand this promising industry in villages and rural areas,” he said when officiating at the Sarawak Economic Development Corporation (SEDC) course on swiftlet rearing yesterday.
Among those present were Deputy Limbang Resident (Social Development) Stephen Kalong and Limbang District Council chairman Sufian Mohat.
Talib, who is also SEDC chairman, said Sarawak’s bird’s nests quality has long been renowned throughout the country and internationally, including in China, as experts recognize its special characteristics.
This presents many opportunities for those interested to diversify their economic activities, he said.
The huge demand for bird’s nests and vast agricultural land in the state, particularly outside urban centres, is a golden opportunity for Bumiputeras, he added.
Talib explained that although the start-up capital expenditure may vary between RM40,000 and RM50,000, the handsome returns made the investment worthwhile.
“A kilogramme, depending on the grade, can fetch between RM4,500 and RM6,500 locally, while the highest price is between RM12,000 and RM24,000,” he said.
He said more studies need to be carried out to further develop the industry.
Meanwhile, Bukit Kota assemblyman Dr Abdul Rahman Ismail, in his speech, called for greater local involvement in higher value economic programmes to enable locals to raise their household incomes.
This should be the trend of communities in Limbang district as the government through SEDC, he said, could assist through a host of economic development programmes.
“When the people’s income and economic standards rise, it will have a knock-on effect on the country’s economic growth,” he pointed out.
He said this is the rationale behind the government’s optimism in encouraging the people to be positive-minded and determined to succeed in various fields.
“The society generally is highly determined to take on various fields that promise good returns, including the lucrative swiftlets rearing industry,” he added.
Swiftlet rearing is taking off in stages in Lawas District.
Two hundred participants from Limbang, Lawas and Ba Kelalan attended the one-day course.
“The swiftlet industry has shifted out of town now and there is growing potential to expand this promising industry in villages and rural areas,” he said when officiating at the Sarawak Economic Development Corporation (SEDC) course on swiftlet rearing yesterday.
Among those present were Deputy Limbang Resident (Social Development) Stephen Kalong and Limbang District Council chairman Sufian Mohat.
Talib, who is also SEDC chairman, said Sarawak’s bird’s nests quality has long been renowned throughout the country and internationally, including in China, as experts recognize its special characteristics.
This presents many opportunities for those interested to diversify their economic activities, he said.
The huge demand for bird’s nests and vast agricultural land in the state, particularly outside urban centres, is a golden opportunity for Bumiputeras, he added.
Talib explained that although the start-up capital expenditure may vary between RM40,000 and RM50,000, the handsome returns made the investment worthwhile.
“A kilogramme, depending on the grade, can fetch between RM4,500 and RM6,500 locally, while the highest price is between RM12,000 and RM24,000,” he said.
He said more studies need to be carried out to further develop the industry.
Meanwhile, Bukit Kota assemblyman Dr Abdul Rahman Ismail, in his speech, called for greater local involvement in higher value economic programmes to enable locals to raise their household incomes.
This should be the trend of communities in Limbang district as the government through SEDC, he said, could assist through a host of economic development programmes.
“When the people’s income and economic standards rise, it will have a knock-on effect on the country’s economic growth,” he pointed out.
He said this is the rationale behind the government’s optimism in encouraging the people to be positive-minded and determined to succeed in various fields.
“The society generally is highly determined to take on various fields that promise good returns, including the lucrative swiftlets rearing industry,” he added.
Swiftlet rearing is taking off in stages in Lawas District.
Two hundred participants from Limbang, Lawas and Ba Kelalan attended the one-day course.
Tuesday, February 23, 2010
EON Cap Q4 net profit down 6% on higher expenses
By EDY SARIF
edy@thestar.com.my
KUALA LUMPUR: EON Capital Bhd has posted a lower net profit of RM61.59mil for the fourth quarter ended Dec 31 (FY09), down 6.3% compared with RM65.7mil in the previous corresponding period on higher operating and taxation expenses.
In a statement to Bursa Malaysia yesterday, the group said revenue declined to RM599.07mil from RM690.96mil in the previous corresponding period while earnings per share were 8.88 sen against 9.48 sen in the same period last year.
The group has proposed first and final tax-exempt dividend of 10 sen per share amounting to RM69.32mil for the financial year ended Dec 31, 2009 compared with 5.77 sen per share dividend in 2008.
Meanwhile, at a press conference on EON Bank’s results yesterday, group chief executive officer Michael Lor said the group had posted a higher net profit of RM341.1mil for the year ended Dec 31 (FY09).
“This was due to strong loans and deposits growth driven by our transformation programme (investment in infrastructure, systems and marketing position), bringing the group’s net profit higher to more than 155% compared with RM133.7mil in 2008,” he said.
An analyst contacted by StarBizWeek said the group’s FY09’s performance was within her expectation but the bank’s loan and deposit growth were stronger than expected.
Revenue for FY09 declined to RM2.39bil from RM2.58bil in 2008 while earnings per share were 49.2 sen compared with 19.3 sen in 2008.
Lor said the group’s market share for domestic loans and advances rose to 4.2% as at end-Nov 2009 from 4.1% at end-2008. Total credit card receivables rose to RM1.45bil, an increase of nearly RM253.2mil or 21.2%.
He said the group was confident of achieving its target of 14% loans growth in 2010 as undrawn loan commitments had increased by RM2.1bil or 16.1% during the year to RM15bil compared with RM12.9 bil in 2008.
Its net loans, advances and financing expanded by RM2.4bil last year, driven mainly by growth in housing loans, other term loans/finance, hire purchase receivables and credit cards as well as commercial lending to small and medium-scale enterprises.
Lor said the group’s lending was mainly in the consumer and SME sectors, which accounted for 59.8% and 20.4% respectively of the total loans outstanding as at end 2009.
The group’s core capital ratio (CCR) improved to 11.2% in 2009 from 9.2% last year, while the risk-weighted capital ratio (RWCR) improved to 14.4% from 12.6% last year, representing further improvement from the group’s prior quarter CCR of 10.93% and RWCR of 13.46%.
edy@thestar.com.my
KUALA LUMPUR: EON Capital Bhd has posted a lower net profit of RM61.59mil for the fourth quarter ended Dec 31 (FY09), down 6.3% compared with RM65.7mil in the previous corresponding period on higher operating and taxation expenses.
In a statement to Bursa Malaysia yesterday, the group said revenue declined to RM599.07mil from RM690.96mil in the previous corresponding period while earnings per share were 8.88 sen against 9.48 sen in the same period last year.
The group has proposed first and final tax-exempt dividend of 10 sen per share amounting to RM69.32mil for the financial year ended Dec 31, 2009 compared with 5.77 sen per share dividend in 2008.
Meanwhile, at a press conference on EON Bank’s results yesterday, group chief executive officer Michael Lor said the group had posted a higher net profit of RM341.1mil for the year ended Dec 31 (FY09).
“This was due to strong loans and deposits growth driven by our transformation programme (investment in infrastructure, systems and marketing position), bringing the group’s net profit higher to more than 155% compared with RM133.7mil in 2008,” he said.
An analyst contacted by StarBizWeek said the group’s FY09’s performance was within her expectation but the bank’s loan and deposit growth were stronger than expected.
Revenue for FY09 declined to RM2.39bil from RM2.58bil in 2008 while earnings per share were 49.2 sen compared with 19.3 sen in 2008.
Lor said the group’s market share for domestic loans and advances rose to 4.2% as at end-Nov 2009 from 4.1% at end-2008. Total credit card receivables rose to RM1.45bil, an increase of nearly RM253.2mil or 21.2%.
He said the group was confident of achieving its target of 14% loans growth in 2010 as undrawn loan commitments had increased by RM2.1bil or 16.1% during the year to RM15bil compared with RM12.9 bil in 2008.
Its net loans, advances and financing expanded by RM2.4bil last year, driven mainly by growth in housing loans, other term loans/finance, hire purchase receivables and credit cards as well as commercial lending to small and medium-scale enterprises.
Lor said the group’s lending was mainly in the consumer and SME sectors, which accounted for 59.8% and 20.4% respectively of the total loans outstanding as at end 2009.
The group’s core capital ratio (CCR) improved to 11.2% in 2009 from 9.2% last year, while the risk-weighted capital ratio (RWCR) improved to 14.4% from 12.6% last year, representing further improvement from the group’s prior quarter CCR of 10.93% and RWCR of 13.46%.
EON Cap remains shrouded in uncertainty
By YVONNE TAN
KUALA LUMPUR: If the situation at EON Capital Bhd (EON Cap) seemed hazy before its EGM on Monday, the fog thickened when the shareholders’ meeting was adjourned to March 15 due to some technical issues.
The adjournment will no doubt buy the shareholders extra time for interested parties aside from Hong Leong Bank Bhd (HLB) to make their offers for the financial group’s assets and liabilities.
“The latest newsflow will likely give rise to hope that EON Cap will be able to find another buyer among the domestic banking groups, which might provide a higher offer,” AmResearch told clients in a note following the adjournment of the EGM yesterday.
“There are other interested parties,” a source said.
Three names – RHB Bank Bhd, Alliance Financial Group Bhd (AFG) and Affin Bank Bhd – have been bandied around as potential suitors.
However, informed sources indicated that talks with any parties were only verbal with no firm offer on the table yet.
AmResearch said that from its checks with AFG last week, the company had said it was not interested in bidding for EON Cap. As for Affin, “we believe that indications are that a bid would be premature at this stage,” it said.
Earlier, property group Mulpha International Bhd failed to obtain Bank Negara approval to commence talks for a stake in EON Cap. It is also reported that a second application from construction outfit Teratai Sanjung (M) Bhd was also unsuccessful, presumably because the two non-financial firms do not fit in with the central bank’s plan to consolidate the banking industry in the country.
Mulpha is believed to have written to Bank Negara seeking an explanation for the rejection of its proposal to negotiate the purchase of a stake in EON Cap.
To recap, shortly after the EON Cap board rejected a RM4.92bil takeover offer from HLB for its assets and liabilites and decided not to table the offer to shareholders, director Rin Kei Mei, who owns 15.5% in EON Cap, called for an EGM to reconstitute the board, presumably to put through to shareholders any fresh takeover offer from HLB.
HLB’s cash offer was deemed by the board as “undervalued”, given that the financial group had undergone a three-year transformation programme which had positioned it for “strong and sustained future growth as an independent company”, EON Cap had said.
Rin is said to be a willing seller of his stake, given a low entry cost while EON Cap’s single largest shareholder, Primus Pacific Partners (HK) Ltd, is largely perceived as the reluctant seller as it had purchased the shares at RM9.55 each in February 2008 and would have lost some US$100mil had the HLB deal gone through.
Primus has a 20.2% stake in EON Cap. Tan Sri Tiong Hiew King has 17.1%, Khazanah Nasional Bhd, 10% and the Employees Provident Fund 12%.
Apart from Primus, all were said to be interested in HLB’s offer.
The adjournment of the EGM will especially provide some breathing space for Primus, which needs Bank Negara approval to commence talks with any potential party, observers say.
Primus believed that it should be able to sell its stake at a price higher than HLB’s offer of RM7.10 per share as growth in EON Cap was starting to take off, they said.
The country’s seventh largest lender, EON Cap’s net profit for its financial year ended Dec 31 (FY09) jumped 155% to RM341.1mil from FY08, driven by an 8% growth in loans.
However, it reported a lower net profit of RM61.59mil for the fourth quarter ended Dec 31, down 6.3% compared with RM65.7mil in the previous corresponding period on higher operating and taxation expenses.
The financial group has said it is targeting a 15% growth in loans this year, backed by its aggressive three-year business strategy.
One of the technical issues that led to the adjournment of Monday’s meeting, which lasted just under 20 minutes, was that chairman Tan Sri Syed Anwar Jamalullail was chosen as proxy for shareholders who collectively own some 6% interest in the banking group.
Section 149 of the Companies Act states that to qualify as a proxy, one needs to be a member (shareholder) of the company, an approved advocate solicitor or approved company auditor.
As Syed Anwar was not any of these, he could not carry out the proxy votes.
However, in a late filing with with Bursa Malaysia yesterday, EON Cap said Syed Anwar had purchased 1,000 shares in the company at RM6.94 each on Monday.
Earlier,there was also some concern over the words “with immediate effect” used in the EGM notice with regard to the proposed appointment of new directors.
“The appointments, if approved at the EGM scheduled for Feb 22 at Hotel Equatorial KL, will be of immediate effect,” the notice had said.
Rightfully, under local laws, appointments of financial institution directors would first have to be approved by Bank Negara.
A new notice for the next meeting to be held on March 15 will be appended to read the proposed directors will be appointed upon “approval of the regulator”, instead of “with immediate effect”.
The notice for the fresh EGM is expected today.
KUALA LUMPUR: If the situation at EON Capital Bhd (EON Cap) seemed hazy before its EGM on Monday, the fog thickened when the shareholders’ meeting was adjourned to March 15 due to some technical issues.
The adjournment will no doubt buy the shareholders extra time for interested parties aside from Hong Leong Bank Bhd (HLB) to make their offers for the financial group’s assets and liabilities.
“The latest newsflow will likely give rise to hope that EON Cap will be able to find another buyer among the domestic banking groups, which might provide a higher offer,” AmResearch told clients in a note following the adjournment of the EGM yesterday.
“There are other interested parties,” a source said.
Three names – RHB Bank Bhd, Alliance Financial Group Bhd (AFG) and Affin Bank Bhd – have been bandied around as potential suitors.
However, informed sources indicated that talks with any parties were only verbal with no firm offer on the table yet.
AmResearch said that from its checks with AFG last week, the company had said it was not interested in bidding for EON Cap. As for Affin, “we believe that indications are that a bid would be premature at this stage,” it said.
Earlier, property group Mulpha International Bhd failed to obtain Bank Negara approval to commence talks for a stake in EON Cap. It is also reported that a second application from construction outfit Teratai Sanjung (M) Bhd was also unsuccessful, presumably because the two non-financial firms do not fit in with the central bank’s plan to consolidate the banking industry in the country.
Mulpha is believed to have written to Bank Negara seeking an explanation for the rejection of its proposal to negotiate the purchase of a stake in EON Cap.
To recap, shortly after the EON Cap board rejected a RM4.92bil takeover offer from HLB for its assets and liabilites and decided not to table the offer to shareholders, director Rin Kei Mei, who owns 15.5% in EON Cap, called for an EGM to reconstitute the board, presumably to put through to shareholders any fresh takeover offer from HLB.
HLB’s cash offer was deemed by the board as “undervalued”, given that the financial group had undergone a three-year transformation programme which had positioned it for “strong and sustained future growth as an independent company”, EON Cap had said.
Rin is said to be a willing seller of his stake, given a low entry cost while EON Cap’s single largest shareholder, Primus Pacific Partners (HK) Ltd, is largely perceived as the reluctant seller as it had purchased the shares at RM9.55 each in February 2008 and would have lost some US$100mil had the HLB deal gone through.
Primus has a 20.2% stake in EON Cap. Tan Sri Tiong Hiew King has 17.1%, Khazanah Nasional Bhd, 10% and the Employees Provident Fund 12%.
Apart from Primus, all were said to be interested in HLB’s offer.
The adjournment of the EGM will especially provide some breathing space for Primus, which needs Bank Negara approval to commence talks with any potential party, observers say.
Primus believed that it should be able to sell its stake at a price higher than HLB’s offer of RM7.10 per share as growth in EON Cap was starting to take off, they said.
The country’s seventh largest lender, EON Cap’s net profit for its financial year ended Dec 31 (FY09) jumped 155% to RM341.1mil from FY08, driven by an 8% growth in loans.
However, it reported a lower net profit of RM61.59mil for the fourth quarter ended Dec 31, down 6.3% compared with RM65.7mil in the previous corresponding period on higher operating and taxation expenses.
The financial group has said it is targeting a 15% growth in loans this year, backed by its aggressive three-year business strategy.
One of the technical issues that led to the adjournment of Monday’s meeting, which lasted just under 20 minutes, was that chairman Tan Sri Syed Anwar Jamalullail was chosen as proxy for shareholders who collectively own some 6% interest in the banking group.
Section 149 of the Companies Act states that to qualify as a proxy, one needs to be a member (shareholder) of the company, an approved advocate solicitor or approved company auditor.
As Syed Anwar was not any of these, he could not carry out the proxy votes.
However, in a late filing with with Bursa Malaysia yesterday, EON Cap said Syed Anwar had purchased 1,000 shares in the company at RM6.94 each on Monday.
Earlier,there was also some concern over the words “with immediate effect” used in the EGM notice with regard to the proposed appointment of new directors.
“The appointments, if approved at the EGM scheduled for Feb 22 at Hotel Equatorial KL, will be of immediate effect,” the notice had said.
Rightfully, under local laws, appointments of financial institution directors would first have to be approved by Bank Negara.
A new notice for the next meeting to be held on March 15 will be appended to read the proposed directors will be appointed upon “approval of the regulator”, instead of “with immediate effect”.
The notice for the fresh EGM is expected today.
Nasfund profit
MORE than 300,000 working Papua New Guineans, members of superannuation fund, Nasfund, will see their savings increase by 15% starting today.Nasfund joint chief executive officer Ian Tarutia announced the good news yesterday when declaring a net profit (after tax) of K205.617 million for 2009.This simply means that if you have K10,000 in your savings, you can expected a windfall of K1,500.“In fact, it is happening now as our systems are down to allow crediting into members’ accounts,” Mr Tarutia said.As of midday yesterday, Nasfund shut down its normal daily operations to allow crediting to take place for its 126,812 active and 186,222 non-active members, including Eda Super contributors.Normal operations will resume today.In total, Nasfund is crediting K213.5 million to the members’ accounts on the back of the fund’s excellent gains in the equity portfolio.While the 15% interest rate is good news for members, Nasfund has cautioned members not to expect another double-digit return this year. Last year, members received 8% after the record 37% in 2007, 10% in 2006 and 29% in 2005.Mr Tarutia said Nasfund was cautious with this year “on the back of what is happening in the international economy”.“The international environment remains uncertain at this point and there is potential for a double dip recession,” he said, adding indications were that this year’s rate might be slightly higher than the predicated 9.5% inflation rate.He said the 15% rate came about as a result of last year’s financial results.These included: a net profit (after tax) of K205.617 million; net asset value of K1.7 billion; and in the other highlights the fund grew by 21% (compared to 19% in 2008) with the number of active employers that the fund has is 1,784 representing a growth of 7.5% over last year; 123 employers’ net going into the fund; and active membership base as of Dec 31 was 126,812 members.Mr Tarutia said Nasfund staff, management and the board were pleased with the results, adding the Management Expenditure Ratio (MER) was 1.12% down 0.13% from 1.25% in 2008.“MER measures the efficiency of the fund basically what we spent in administering the fund and the total asset value.“This compares to 1.25% in 2008, so as we are growing and becoming more efficient in the use of assets in administering the organisation,” Mr Tarutia said.In withdrawals, the fund paid out K125.584 million to 55,846 members through unemployment, housing advancement, partial withdrawals, retirement and redundancy, among others.“The contributions (inflows) from employers by way of member and employer contribution contributed to K232.7 million,” he said.The gains in equity portfolios were in New Britain Palm Oil Ltd, Lihir Gold Ltd and Oil Search Ltd, as well as gains on the currency rate contributing K127 million.Mr Tarutia said the unlisted portfolio contributed K14 million to the portfolio and the overall net gain despite a decrease in Bank South Pacific and Credit Corporation which contributed K68.5 million, flows came from dividends from interest payments on loans and from profit income.“And all that combined to the K205 million that the fund recorded,” he said.The audited annual report will be published and the members’ statements will be issued starting next week.
ExxonMobil now Nasfund major lessee
Source:
By SHEILA LASIBORI
EXXONMobil has booked most of the properties being leased out by national superannuation fund, Nasfund, through its real estate business arm.Majority of these office and apartment spaces are in buildings that have been constructed at Harbour City in Konedobu, Port Moresby, according to Nasfund joint executive Ian Tarutia.While ExxonMobil, operator of the PNG liquefied natural gas (LNG) project leads the lessee tally, other players in the US$15 billion (K40 billion) project would also occupy some of the buildings in the area.Mr Tarutia said the property developments, mostly located at the Harbour City, had all been pre-listed to customers and ExxonMobil was the major customer.Construction in progress was on Harbour City’s Ravalien Haus, Sol Wara and the Investment Promotion Authority Haus.The Edge is set for construction next year.“The property development is being built to meet the players involved in the LNG project.“ExxonMobil has taken up most of our developments … the buildings, all at Harbour City, have been taken up by Exxon Mobil,” Mr Tarutia said yesterday when he revealed Nasfund’s operations for the 2009 financial year.He also said ExxonMobil currently located at Credit Corp building in town would be relocated to the yet-to-be completed building next month at Konedobu called the Factory, just off the Sir Hubert Murray stadium.“That is our participation in the LNG project … (We are) putting up buildings to house the players that are going to be involved in the LNG project, the main one being Exxon Mobil.“So in short all the buildings we have been engaged in … all the construction that we have done have in fact being pre-list … so, as soon as they are completed tenants (will) move in and we start earning rental,” he said.
By SHEILA LASIBORI
EXXONMobil has booked most of the properties being leased out by national superannuation fund, Nasfund, through its real estate business arm.Majority of these office and apartment spaces are in buildings that have been constructed at Harbour City in Konedobu, Port Moresby, according to Nasfund joint executive Ian Tarutia.While ExxonMobil, operator of the PNG liquefied natural gas (LNG) project leads the lessee tally, other players in the US$15 billion (K40 billion) project would also occupy some of the buildings in the area.Mr Tarutia said the property developments, mostly located at the Harbour City, had all been pre-listed to customers and ExxonMobil was the major customer.Construction in progress was on Harbour City’s Ravalien Haus, Sol Wara and the Investment Promotion Authority Haus.The Edge is set for construction next year.“The property development is being built to meet the players involved in the LNG project.“ExxonMobil has taken up most of our developments … the buildings, all at Harbour City, have been taken up by Exxon Mobil,” Mr Tarutia said yesterday when he revealed Nasfund’s operations for the 2009 financial year.He also said ExxonMobil currently located at Credit Corp building in town would be relocated to the yet-to-be completed building next month at Konedobu called the Factory, just off the Sir Hubert Murray stadium.“That is our participation in the LNG project … (We are) putting up buildings to house the players that are going to be involved in the LNG project, the main one being Exxon Mobil.“So in short all the buildings we have been engaged in … all the construction that we have done have in fact being pre-list … so, as soon as they are completed tenants (will) move in and we start earning rental,” he said.
OSL profit plunges
MELBOURNE: Oil Search Ltd is looking to the massive Papua New Guinea liquefied natural gas (LNG) project to generate growth, after revealing a sharp fall in calendar 2009 profit due to falling oil prices and lower sales.Oil Search said the US$15 billion (K41 billion) PNG LNG project could eventually be built up to have four trains, greatly expanding its original capabilities.“The story about Oil Search is very much around PNG LNG, not just this project, but also what we are doing in terms of medium-and-long-term growth around that project,” chief executive Peter Botten said in a teleconference yesterday.The ExxonMobil-led PNG LNG joint venture is expected to begin production in 2014, and Oil Search holds 29% stake in the project.Two gas trains were expected to be built for PNG LNG, but the company said there might be sufficient resource base to underwrite another two trains.Early plans are for a third train to be built in late 2015 or early 2016, Botten said, with a fourth train possible.“There are a range of opportunities and a range of synergies that come from PNG LNG if you are able to do a further development in that time frame,” Mr Botten said.Oil Search, Papua New Guinea’s biggest oil producer, posted a net profit of US$133.68 million (K365.37 million), down 57.3% from US$313.36 million (K858.52 million), in 2008.“The profit decline was primarily due to a 35% fall in the average realised oil price combined with 7% lower oil sales,” the company said in a statement.
Monday, February 22, 2010
Gas project slated to sign funding deal
Source:
By SHEILA LASIBORI
INTERNATIONAL banks and export credit agencies (ECA) are set to sign a record financing agreement next month to develop the PNG liquefied natural gas (LNG) project.American-based Trade Finance magazine reported that a deal is set to close by mid March towards a US$14 billion (K40 billion) financing scheme for the development of the LNG project being spearheaded by ExxonMobil and a consortium.It reported that the expected total project cost was US$18.3 billion (K50 billion) and once developed, would double the gross domestic product of PNG.The Export-Import Bank of the US (Eximbank) last December approved the largest financing transaction in its 75-year history of US$3 billion to support US exports for the PNG LNG project.This was moments after ECAs committed US$14 billion (K38 billion) towards the project costs.Workers at over 55 US companies would provide goods and services for the project.Eximbank, the official ECA of the US, five other ECAs and 17 commercial banks would provide financing for the project.Also in December, the Australian government announced US$500 million (K1.4 billion) loan to support PNG LNG project development.Project operator Esso Highlands Ltd, a subsidiary of ExxonMobil, holds 33.2% stake in the project while the other participants include, Oil Search Ltd (29.0%) Independent Public Business Corp (PNG Government, 16.6%), Santos Ltd (13.5%), Nippon Oil Exploration (4.7%), Mineral Resources Development Co (PNG landowners, 2.8%) and Petromin PNG Holdings Ltd’s subsidiary Eda Oil (0.2%).Miles Shaw, Esso’s manager for public and government affairs, said finalisation of financing and completion of the last LNG sales and purchase agreement (SPA) with an Asian-Pacific buyer was expected to be completed in the first quarter of this year.The outstanding SPA is with China Petroleum Co (CPC) of Taiwan, for an estimated 1.3 million tonnes of LNG per annum (mta) from the total 6.6mta of LNG from the project.The previous three SPAs signed were with Japan’s Osaka Gas Co Ltd, for 1.5mta of LNG on Dec 22; with Tokyo Electric Power Co Inc (TEPCO) for 1.8mta of LNG on Dec 7; and on Dec 3 with UNIPEC Asia Co, Ltd., a subsidiary of China Petroleum & Chemical Corp (Sinopec) for 2.0mta of LNG.These agreements are long-term and effective for a 20-year period.The PNG LNG Project is an integrated development that includes gas production and processing facilities, onshore and offshore pipelines and liquefaction facility with the capacity of 6.6 million tonnes of LNG per year.Meanwhile, work on the project at various sites in Southern Highlands province is progressively restarting.“We will advise when all sites have returned to normal operations,” Mr Shaw said.
By SHEILA LASIBORI
INTERNATIONAL banks and export credit agencies (ECA) are set to sign a record financing agreement next month to develop the PNG liquefied natural gas (LNG) project.American-based Trade Finance magazine reported that a deal is set to close by mid March towards a US$14 billion (K40 billion) financing scheme for the development of the LNG project being spearheaded by ExxonMobil and a consortium.It reported that the expected total project cost was US$18.3 billion (K50 billion) and once developed, would double the gross domestic product of PNG.The Export-Import Bank of the US (Eximbank) last December approved the largest financing transaction in its 75-year history of US$3 billion to support US exports for the PNG LNG project.This was moments after ECAs committed US$14 billion (K38 billion) towards the project costs.Workers at over 55 US companies would provide goods and services for the project.Eximbank, the official ECA of the US, five other ECAs and 17 commercial banks would provide financing for the project.Also in December, the Australian government announced US$500 million (K1.4 billion) loan to support PNG LNG project development.Project operator Esso Highlands Ltd, a subsidiary of ExxonMobil, holds 33.2% stake in the project while the other participants include, Oil Search Ltd (29.0%) Independent Public Business Corp (PNG Government, 16.6%), Santos Ltd (13.5%), Nippon Oil Exploration (4.7%), Mineral Resources Development Co (PNG landowners, 2.8%) and Petromin PNG Holdings Ltd’s subsidiary Eda Oil (0.2%).Miles Shaw, Esso’s manager for public and government affairs, said finalisation of financing and completion of the last LNG sales and purchase agreement (SPA) with an Asian-Pacific buyer was expected to be completed in the first quarter of this year.The outstanding SPA is with China Petroleum Co (CPC) of Taiwan, for an estimated 1.3 million tonnes of LNG per annum (mta) from the total 6.6mta of LNG from the project.The previous three SPAs signed were with Japan’s Osaka Gas Co Ltd, for 1.5mta of LNG on Dec 22; with Tokyo Electric Power Co Inc (TEPCO) for 1.8mta of LNG on Dec 7; and on Dec 3 with UNIPEC Asia Co, Ltd., a subsidiary of China Petroleum & Chemical Corp (Sinopec) for 2.0mta of LNG.These agreements are long-term and effective for a 20-year period.The PNG LNG Project is an integrated development that includes gas production and processing facilities, onshore and offshore pipelines and liquefaction facility with the capacity of 6.6 million tonnes of LNG per year.Meanwhile, work on the project at various sites in Southern Highlands province is progressively restarting.“We will advise when all sites have returned to normal operations,” Mr Shaw said.
Sunday, February 21, 2010
PNGPCL lays new pipeline for fuel depot
Source:
By SHEILA LASIBORI
CIVIL work has started at a section of the Poreporena Freeway in Port Moresby to lay a 200mm in diametre pipeline belonging to PNG Ports Corp Ltd (PNGPCL).The work by Global Construction started on Wednesday which will also include repair and relocation of tank 7 fuel pipeline underground starting from PNGPCL Port Moresby terminal 5 container storage area across the freeway, to the side of PNG Law and Justice Sector office along the freeway just off PNG Defence Force Basilisk naval base.PNGPCL estimated that the excavation, pipe laying, backfilling and road finishing works will take up to two weeks.It advised that a section of the freeway lane leading towards downtown Port Moresby was the first to be temporarily closed with oncoming traffic detoured to the other half lane on the opposite site of the Freeway.Work will take two weeks to complete.
By SHEILA LASIBORI
CIVIL work has started at a section of the Poreporena Freeway in Port Moresby to lay a 200mm in diametre pipeline belonging to PNG Ports Corp Ltd (PNGPCL).The work by Global Construction started on Wednesday which will also include repair and relocation of tank 7 fuel pipeline underground starting from PNGPCL Port Moresby terminal 5 container storage area across the freeway, to the side of PNG Law and Justice Sector office along the freeway just off PNG Defence Force Basilisk naval base.PNGPCL estimated that the excavation, pipe laying, backfilling and road finishing works will take up to two weeks.It advised that a section of the freeway lane leading towards downtown Port Moresby was the first to be temporarily closed with oncoming traffic detoured to the other half lane on the opposite site of the Freeway.Work will take two weeks to complete.
Landowners in Hides target gas spin-offs
THE people of Hides 4 have launched an umbrella company to get involved in spin-off benefits in the LNG project in the Southern Highlands province.Hides 4 was previously PRL12, until recently when it became PDL7 after an issue of the petroleum development licence.PDL7 holds about 15.3 trillion cubic feet of gas, which is about 59% of the total gas for the unified project, which will cost about US$17 billion (K46.7 billion) to develop.Clans in PDL7 are divided into six blocks.Various leaders who backed the umbrella company include Robert Hawi (block1), Jocky Tindipur (block2), Ikipe Alembo (block3), Hengepe Haluya (block4), Eric Ayule (block5), and John Honale (block6).All the blocks agreed to form the umbrella company Gigira Parepare Resources Limited (GPRL).GPRL chairman Eric Ayule said all the clans in PDL7 decided to unite behind this company so they could benefit from spin-off businesses from the project.Mr Ayule said the creation up of the umbrella company was in line with what was outlined to them by the Department of Petroleum and Exxonmobil during the umbrella and licenced-based benefit sharing forums held last year.He said the GPRL has met Investment Promotion Authority (IPA) and Internal Revenue Commission (IRC) statutory requirements, and received the approval of the ministry and department of petroleum and energy.Mr Ayule said they were promised K15 million during the benefit sharing forums as seed capital to launch the companies.He said they want the Government to release the money now to them so they can prepare for work from the developer.GPRL is preparing to submit their business plan to Esso Highlands, the subsidiary of Exxonmobil.PDL7 is crucial to the entire project.While it holds majority of the gas, the Gas Conditioning Plant will be built there.
Thursday, February 18, 2010
InterOil ups gas reserves by 141%
INTEROIL could be sitting on more than eight trillion cubic feet of contingent recoverable gas resources at its Elk/Antelope field in the Gulf province.This was announced yesterday by an independent valuation firm, GLJ Petroleum Consultants, which also estimated initial recoverable condensate at 156.5 million barrels as of Dec 31, 2009.GLJ also announced that there was no significant oil leg, although InterOil said a week ago that it has started horizontal drilling to check for possible oil shows.The GLJ report provides a best case estimate of 8.2 trillion cubic feet (tcf) of natural gas and 156.5 million barrels of condensate (mmb).This compares to the year-end 2008 best case contingent resources estimate of 3.4 tcf of natural gas and 59.3 MMBbls. This amounts to a 141% increase from 631 million barrels of oil equivalent (MMBOE) to 1.52 billion barrels of oil equivalent (boe). All resources estimated in the GLJ Report are classified as contingent resources“These results reflect the quality of our people and our assets,” chief executive and chairman Phil Mulacek said.
Tuesday, February 16, 2010
Work permit violations
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By SHEILA LASIBORI
FOREIGN nationals recruited to work in PNG must ensure they follow proper procedures to legitimise their status in the country, secretary to the National Government Manasupe Zurenuoc said.The chief secretary Zurenuoc said: “The presence of illegal aliens and the employment of illegal foreigners are major security concerns.”Mr Zurenuoc made particular reference to the recent events involving Allied Gold Ltd, the 14 Fijians and PNG Immigration including Police.“The manner in which the Fijians were recruited by Allied Gold raises serious concerns pertaining to the direct violations of both Immigration and Labour laws.“I urge all foreign companies operating in the country to fully comply with the mandatory requirements of employing foreign nationals in PNG.”Mr Zurenuoc said the court found that the Fijians were illegally working in the country and were deported.The Department of Labour and Industrial Relations had raised concerns regarding foreign employees and foreign-registered companies operating in PNG.Acting secretary for Labour Department David Tibu said expatriate employees including consultants are required to hold valid work permits under the Employment of Non-citizen’s Act 2007.Mr Tibu said this after the Labour Department’s work permit inspectors visited mobile phone company bemobile last November to hold discussions on foreign employment (work permit) requirements during the “Orange Men” promotion. “bemobile has only eight work permits issued to date … we got news that the ‘Orange Men are coming’ which could mean, non-citizens, on business visa, which are prohibited for employment purposes.“We sent in our work permit inspectors who were refused entry for two days before they were allowed in and eventually they were able to sit down and discuss the foreign employment requirements,” Mr Tibu said.bemobile staff on anonymity confirmed that some of its foreign workers did not have the appropriate documents to work in PNG and so left the country last Nov 11.Mr Tibu said these “foreign” workers could return to PNG once they have sorted out their work documents appropriately.“If and when they comply with all of the requirements for foreign employment in PNG and they hold valid work permits (issued by the Department of Labour and Industrial Relations) with relevant resident employment visa (issued by PNG Immigration and Citizenship Service), then they may be allowed back into the country,” he said.The then bemobile chief executive officer Roger Blott had responded saying: “It is not bemobile policy to comment on internal matters.“However, as a good corporate citizen, bemobile takes compliance with all the laws of PNG very seriously and will not knowingly violate any of them … that obviously includes the laws regarding employment and immigration.”Mr Tibu also raised concerns on possible tax evasion by companies if they were not duly registered with Investment Promotion Authority (IPA).“I want to stress that taxation is one of the major reasons why companies inclusive of foreign registered companies must register with IPA. And unless companies register with IPA, work permits cannot be processed”.
By SHEILA LASIBORI
FOREIGN nationals recruited to work in PNG must ensure they follow proper procedures to legitimise their status in the country, secretary to the National Government Manasupe Zurenuoc said.The chief secretary Zurenuoc said: “The presence of illegal aliens and the employment of illegal foreigners are major security concerns.”Mr Zurenuoc made particular reference to the recent events involving Allied Gold Ltd, the 14 Fijians and PNG Immigration including Police.“The manner in which the Fijians were recruited by Allied Gold raises serious concerns pertaining to the direct violations of both Immigration and Labour laws.“I urge all foreign companies operating in the country to fully comply with the mandatory requirements of employing foreign nationals in PNG.”Mr Zurenuoc said the court found that the Fijians were illegally working in the country and were deported.The Department of Labour and Industrial Relations had raised concerns regarding foreign employees and foreign-registered companies operating in PNG.Acting secretary for Labour Department David Tibu said expatriate employees including consultants are required to hold valid work permits under the Employment of Non-citizen’s Act 2007.Mr Tibu said this after the Labour Department’s work permit inspectors visited mobile phone company bemobile last November to hold discussions on foreign employment (work permit) requirements during the “Orange Men” promotion. “bemobile has only eight work permits issued to date … we got news that the ‘Orange Men are coming’ which could mean, non-citizens, on business visa, which are prohibited for employment purposes.“We sent in our work permit inspectors who were refused entry for two days before they were allowed in and eventually they were able to sit down and discuss the foreign employment requirements,” Mr Tibu said.bemobile staff on anonymity confirmed that some of its foreign workers did not have the appropriate documents to work in PNG and so left the country last Nov 11.Mr Tibu said these “foreign” workers could return to PNG once they have sorted out their work documents appropriately.“If and when they comply with all of the requirements for foreign employment in PNG and they hold valid work permits (issued by the Department of Labour and Industrial Relations) with relevant resident employment visa (issued by PNG Immigration and Citizenship Service), then they may be allowed back into the country,” he said.The then bemobile chief executive officer Roger Blott had responded saying: “It is not bemobile policy to comment on internal matters.“However, as a good corporate citizen, bemobile takes compliance with all the laws of PNG very seriously and will not knowingly violate any of them … that obviously includes the laws regarding employment and immigration.”Mr Tibu also raised concerns on possible tax evasion by companies if they were not duly registered with Investment Promotion Authority (IPA).“I want to stress that taxation is one of the major reasons why companies inclusive of foreign registered companies must register with IPA. And unless companies register with IPA, work permits cannot be processed”.
NDB eyes unit in Tari
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By ANDREW ALPHONSE in TARI
THE National Development Bank (NDB) has revealed plans to set up a branch in Tari, Southern Highlands province, targeting the US$15 billion (K40 billion) PNG liquefied natural gas (LNG) project.This branch will be to assist local Hela people re-invest income from the project into small business enterprises and agricultural projects.NDB hopes that more Hela farmers and business people would obtain loans to start businesses from the K20 million allocated in this year’s National Budget.NDB will also consider providing other services there, such as passbook savings account and micro finance.NDB will initially start its operations in the next eight weeks at the Tari town authority building while awaiting the National Executive Council’s (NEC) approval on, and construction, of the K5 million two-storey office complex.The plan was revealed on Monday by NDB managing director Richard Maru while in the company of Tari/Pori MP and Education Minister James Marape, and other senior NDB officers when they visited Tari.They also assessed the site for the office complex and also announce the plan.Mr Maru said the NDB Board had decided to close the Mendi branch last December to set up a Tari branch.He said the Mendi office was shut down due to constant attack on its staff, properties and the continued lawlessness which greatly affected their operations.
By ANDREW ALPHONSE in TARI
THE National Development Bank (NDB) has revealed plans to set up a branch in Tari, Southern Highlands province, targeting the US$15 billion (K40 billion) PNG liquefied natural gas (LNG) project.This branch will be to assist local Hela people re-invest income from the project into small business enterprises and agricultural projects.NDB hopes that more Hela farmers and business people would obtain loans to start businesses from the K20 million allocated in this year’s National Budget.NDB will also consider providing other services there, such as passbook savings account and micro finance.NDB will initially start its operations in the next eight weeks at the Tari town authority building while awaiting the National Executive Council’s (NEC) approval on, and construction, of the K5 million two-storey office complex.The plan was revealed on Monday by NDB managing director Richard Maru while in the company of Tari/Pori MP and Education Minister James Marape, and other senior NDB officers when they visited Tari.They also assessed the site for the office complex and also announce the plan.Mr Maru said the NDB Board had decided to close the Mendi branch last December to set up a Tari branch.He said the Mendi office was shut down due to constant attack on its staff, properties and the continued lawlessness which greatly affected their operations.
IBBM, Esso to set up business centre
THE Institute of Banking and Business Management (IBBM) has signed a five-year agreement with Esso Highlands Ltd to set up and operate an enterprise centre.The centre will operate for the PNG liquefied natural gas (LNG) project being developed by Esso Highlands Ltd, a subsidiary of ExxonMobil Corp.The deal was signed by Esso managing director Peter Graham, IBBM directors Ross Hammond and Central Bank governor Loi Bakani.“The engagement and development of PNG businesses is an important aspect of the PNG LNG project’s National Content Plan and the Oil and Gas Act,” Mr Graham said.The centre will facilitate communication between national suppliers, contractors and subcontractors; make public business opportunities; maintain a PNG supplier database; and facilitate access to project information.A statement by IBBM said the centre would also build capacities of national companies by providing business improvement services such as gap analysis, consulting and advisory services; and organising seminars, developing business training plans and providing training.The centre would act as an independent institution and will be located within the IBBM premises at Vanama Crescent, Port Moresby.
Govt should accredit us, says Juha tribe
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By YEHIURA HRIEHWAZI
A GROUP of people claiming to be landowners from the Juha gas field have called on the Government and relevant authorities to recognise them.The Juha Pokaiya tribe composed mostly of the upper and Lower Strickland River basin numbering about 25,800 live in very isolated communities.They hardly interact with the outside world because of inaccessibility to this part of PNG that straddles the provincial boundaries of Western, Southern Highlands, Sandaun and Enga provinces.Their tribal chief Andrew Makano is in Port Moresby with some of his people to meet with Petroleum and Energy Minister William Duma and present their case for recognition.To get to Port Moresby, they had to trek for three days to the Frieda River area in Sandaun province to pan for alluvial gold nuggets which they sold to pay for their airfares to Ok Tedi’s mining township of Tabubil, and then to Port Moresby where they are housed by a relative at the Morata settlement.Speaking in Tok Pisin Mr Makano expressed concern that if they did not make their presence felt, they would be forgotten and other communities like the vocal Huli people would represent their interest and take away benefits that should rightfully belong to them.“We are not educated, we are not able to read and write. We don’t want the educated people to take over what is ours.”We are asking the government to respect us and help us by recognising our existence as landowners of the Juha gas project and treat us as equals with the other project landowners,” Mr Makano said.As an example, he said the Hides Gas Development Corp owned by Hides gas landowners of the Huli people have registered a company called Juha Joint Venture Ltd as a subsidiary company, which he said did not involve them.
By YEHIURA HRIEHWAZI
A GROUP of people claiming to be landowners from the Juha gas field have called on the Government and relevant authorities to recognise them.The Juha Pokaiya tribe composed mostly of the upper and Lower Strickland River basin numbering about 25,800 live in very isolated communities.They hardly interact with the outside world because of inaccessibility to this part of PNG that straddles the provincial boundaries of Western, Southern Highlands, Sandaun and Enga provinces.Their tribal chief Andrew Makano is in Port Moresby with some of his people to meet with Petroleum and Energy Minister William Duma and present their case for recognition.To get to Port Moresby, they had to trek for three days to the Frieda River area in Sandaun province to pan for alluvial gold nuggets which they sold to pay for their airfares to Ok Tedi’s mining township of Tabubil, and then to Port Moresby where they are housed by a relative at the Morata settlement.Speaking in Tok Pisin Mr Makano expressed concern that if they did not make their presence felt, they would be forgotten and other communities like the vocal Huli people would represent their interest and take away benefits that should rightfully belong to them.“We are not educated, we are not able to read and write. We don’t want the educated people to take over what is ours.”We are asking the government to respect us and help us by recognising our existence as landowners of the Juha gas project and treat us as equals with the other project landowners,” Mr Makano said.As an example, he said the Hides Gas Development Corp owned by Hides gas landowners of the Huli people have registered a company called Juha Joint Venture Ltd as a subsidiary company, which he said did not involve them.
Gulf to build LNG support facilities
Source:
By SHEILA LASIBORI
THE Gulf provincial government is leading the way in developing infrastructure for business activities in the province to support the InterOil-led liquefied natural gas (LNG) project.The deep water port development at Orokolo Bay and the industrial park are the main projects, among others, being spearheaded by the provincial government led by Governor Havila Kavo.At present, the hydrographic survey and feasibility study and infrastructure development are being carried out.The project is conducted in consultation with project developer InterOil and Petromin (PNG) Holdings Ltd.According to Mark Baiai, the executive director for Gulf Provincial Economic Development Authority (GPEDA), the provincial government through its company Gulf Oil and Gas holds 20% equity interest in the deep water port project under the build, operate and transfer (BOT) scheme.The local people from both impacted and non-impacted areas will be offered shares in the company.The deal was with Hong Kong-based company Energy World Investment (EWI).The 20% equity is a free carry interest which will increase to 49% after 25 years based on commercial terms the provincial government entered into with EWI.EWI holds 80% interest, which will change to 51% at the end of the 25 years.Mr Baiai said the port’s location was strategic, being located directly south from Elk/Antelope project sites, and it is also accessible from by other provinces mostly in the highlands.“It is strategic because it can become the next economic port which will support activities up in the Highlands and also would contribute to the country’s economic development.”He said the GPEDA, together with Gulf Investment Trust Fund (GITF), developed the concept.Mr Baiai said the industrial park also included developments for the deep sea port for the discharge of gas condensate, the dissemination of LNG from Elk/Antelope.The authority also aims to support the InterOil project in providing the facilities to store and export the LNG product.
By SHEILA LASIBORI
THE Gulf provincial government is leading the way in developing infrastructure for business activities in the province to support the InterOil-led liquefied natural gas (LNG) project.The deep water port development at Orokolo Bay and the industrial park are the main projects, among others, being spearheaded by the provincial government led by Governor Havila Kavo.At present, the hydrographic survey and feasibility study and infrastructure development are being carried out.The project is conducted in consultation with project developer InterOil and Petromin (PNG) Holdings Ltd.According to Mark Baiai, the executive director for Gulf Provincial Economic Development Authority (GPEDA), the provincial government through its company Gulf Oil and Gas holds 20% equity interest in the deep water port project under the build, operate and transfer (BOT) scheme.The local people from both impacted and non-impacted areas will be offered shares in the company.The deal was with Hong Kong-based company Energy World Investment (EWI).The 20% equity is a free carry interest which will increase to 49% after 25 years based on commercial terms the provincial government entered into with EWI.EWI holds 80% interest, which will change to 51% at the end of the 25 years.Mr Baiai said the port’s location was strategic, being located directly south from Elk/Antelope project sites, and it is also accessible from by other provinces mostly in the highlands.“It is strategic because it can become the next economic port which will support activities up in the Highlands and also would contribute to the country’s economic development.”He said the GPEDA, together with Gulf Investment Trust Fund (GITF), developed the concept.Mr Baiai said the industrial park also included developments for the deep sea port for the discharge of gas condensate, the dissemination of LNG from Elk/Antelope.The authority also aims to support the InterOil project in providing the facilities to store and export the LNG product.
InterOil acquires US$4.5m drill rig
INTEROIL Corp has acquired a second drilling rig worth US$4.5 million (K12.30 million) which is currently located in New Zealand.In a statement, InterOil said it anticipated moving the rig to the country in the second quarter after completion of the transaction and refurbishment of tubular and other rotating equipment.InterOil chairman and chief executive Phil Mulacek said: “We are very satisfied with the acquisition of the second rig which is outstanding in terms of design and capabilities and is particularly well-suited for operations in the area in which our development and exploration activities are being conducted.”The 1,500hp heliportable “triple” rig with top drive was originally built by Parker Drilling.The total cash consideration for the rig and an extensive inventory of drilling and oil field service equipment is NZ$$6.5 million (K12.30 million).
LNG hub is massive: WA
PERTH: An agreement by Woodside Petroleum’s joint venture partners to the proposed site for an LNG hub has opened the way for a A$30 billion (K71 billion) project, the West Australian government said.Premier Colin Barnett describes the agreement as “a significant step” in the development of the Browse Basin liquefied natural gas field off the northwest Australian coast.Woodside Petroleum announced on Monday that its joint venture partners, BHP Billiton, BP, Chevron, Shell and Japan Australia, had agreed to develop the hub at James Price Point, 60km north of Broome.Barnett has championed the selection of James Price Point as the site for a plant to process the gas from the Woodside-led joint venture and other parties operating in the area. After lengthy negotiations, the state government, Woodside and a group representing the traditional owners of the Kimberley region, the Kimberley Land Council (KLC), agreed on the site in April last year. – AAP
US$71mil for PMIZ nears OK
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By ISAAC NICHOLAS
PAPUA New Guinea is finalising an agreement with a Chinese contractor that will see the draw-down of US$71 million (K193 million) for the construction of the Pacific Marine Industrial Zone (PMIZ) in Madang province.A PNG delegation is meeting with officials from Shenyang Economic and Technical Cooperation Co (SETCC) in the Philippines to finalise the deal between the State and the company.SETC is China’s State-owned company based in Shanghai.The PNG team is led by Commerce and Industry Minister Gabriel Kapris, officials from Treasury and Finance, National Planning, State Solicitor, Fisheries and Commerce and Industry.The team left last Saturday and is expected back this week for the execution of the contract agreement by the Governor-General at Government House in Port Moresby.Mr Kapris told The National from Philippines yesterday that the PNG officials were going through the technical issues and would finalise the contract agreement by today.“We will be coming back to Port Moresby for the Governor General to execute the agreement before we leave for China with the papers to draw-down US$71 million of the US$79 million (K214 million) from the Export-Import Bank of China.”Mr Kapris said PMIZ was an important impact project that would be sustainable for many years to come and has the full support of the project impact area people and the Madang provincial government.He said the landowners were supportive after the Government funded a team from the project area to visit similar projects undertaken in the Philippines.Mr Kapris said initial work had started with landowners being involved in spin-off contracts in building the 8km perimeter fencing of the 216ha project area.He said the PNG Government counterpart funding of K29 million had been used so far for initial ground works and a further K44 million has been budgeted for this year.
By ISAAC NICHOLAS
PAPUA New Guinea is finalising an agreement with a Chinese contractor that will see the draw-down of US$71 million (K193 million) for the construction of the Pacific Marine Industrial Zone (PMIZ) in Madang province.A PNG delegation is meeting with officials from Shenyang Economic and Technical Cooperation Co (SETCC) in the Philippines to finalise the deal between the State and the company.SETC is China’s State-owned company based in Shanghai.The PNG team is led by Commerce and Industry Minister Gabriel Kapris, officials from Treasury and Finance, National Planning, State Solicitor, Fisheries and Commerce and Industry.The team left last Saturday and is expected back this week for the execution of the contract agreement by the Governor-General at Government House in Port Moresby.Mr Kapris told The National from Philippines yesterday that the PNG officials were going through the technical issues and would finalise the contract agreement by today.“We will be coming back to Port Moresby for the Governor General to execute the agreement before we leave for China with the papers to draw-down US$71 million of the US$79 million (K214 million) from the Export-Import Bank of China.”Mr Kapris said PMIZ was an important impact project that would be sustainable for many years to come and has the full support of the project impact area people and the Madang provincial government.He said the landowners were supportive after the Government funded a team from the project area to visit similar projects undertaken in the Philippines.Mr Kapris said initial work had started with landowners being involved in spin-off contracts in building the 8km perimeter fencing of the 216ha project area.He said the PNG Government counterpart funding of K29 million had been used so far for initial ground works and a further K44 million has been budgeted for this year.
Sunday, February 7, 2010
Jobs for locals at LNG project
THERE will be three main groups of jobs that will be filled up to directly support the US$15 billion (K40 billion) PNG liquefied natural gas (LNG) project.These are jobs meant for Papua New Guineans in construction, operations and maintenance and in administrative work requiring professionals (for graduate positions).A total 3,450 people would be recruited by next month.A PNG LNG project leaflet which published the type of jobs that are available to local workers said the recruitment was to have started last month.About 150 people would be recruited in operations and maintenance (O&M) and about 3,000 in construction.Initially, about 300 will be recruited starting next month.In the operations and maintenance technician trainee positions, there will be three intakes per year of up to 60 trainees (for a total of 180 to be selected for 150 jobs) over the next three years.They will train in plant operations, mechanical, electrical and instrumentation.
Monday, February 1, 2010
Kina strong against most currencies
THE kina was relatively strong last week against a basket of currencies, except the yen where it experienced some declines.Markets are now waiting on US gross domestic product (GDP) fourth quarter data which is due for release shortly.In a weekly update, the ANZ Bank said a strong US GDP data should provide some support to the greenback.Against the Australian dollar, the kina appreciated by about 1.8% as investors cut risk trades funded by the yen and US dollar.The Aussie underperformed as uncertainties about China’s efforts to restrain bank lending and Ben Bernanke’s re-appointment as US Federal Reserve chairman for a second term weighed on investors’ sentiment.The bank said the kina was relatively firm on US dollar inflows which assist import demand.On the currency front, speculations on higher interest rates in US and general investor interest apathy towards high-yielding currencies gave some boost to the greenback last Thursday.The greenback was also assisted by the news that US Fed and other major central banks would conclude emergency dollar lending operations yesterday.
OSL sees output fall
PERTH: Oil Search Ltd has flagged lower production this calendar year due to maturing oil fields after delivering 2009 output within its forecast and weaker sales revenue due to lower oil prices.In its annual production report yesterday, Oil Search said it expects a 10% fall in output this year to reflect natural field decline, which drove a 6% dip in 2009 production.Oil Search had US$1.255 billion (K3.4 billion) in cash at the end of December and was debt free, leaving it “extremely well placed for this transformational expansion”, managing director Peter Botten said.Constraints on oil output relating to more limited gas flaring was another factor expected to reduce production this year, although this would be partly offset by maintenance programmes to reduce downtime.Papua New Guinea’s largest oil and gas producer’s total output for calendar 2009 was 8.1 million barrels of oil equivalent (mmboe), within its guidance range of 8.0-8.3 mmboe and down from 8.6 mmboe in 2008.“Oil production will be pretty flat for the next few years but when the PNG LNG (liquefied natural gas) project comes on stream in 2014, Oil Search will take off like a rocket,” CMC Markets analyst David Taylor said.“It’s one for long term investors.”Oil Search, which has a stake of about 30% stake in the PNG LNG development, said last month the multi-billion dollar project would add more than 19 mmboe to its annual production.It also said the ExxonMobil-led joint venture remained on track to achieve financial close in the first quarter of this year.Mr Taylor said Oil Search’s 2009 result was unsurprising given it was impacted by oil price and currency fluctuations.Full year sales revenue was down 38% at US$475.8 million (K1.3 billion) reflecting lower output and a 35% fall in the average realised oil price during the 12 months.The average realised oil price in 2008 was US$100.10 (K270.91) per barrel, compared to US$65.39 (K176.97) per barrel last year.Mr Taylor said Oil Search’s operating costs in PNG were relatively high.The company said operating costs were expected to rise this year. – AAP
Thursday, January 28, 2010
Gas project won’t fulfill PNG’s needs
Source:
By OSEAH PHILEMON
PAPUA New Guinea’s energy demand will increase by 300% over the next five to 10 years – but none of it will be met by the upcoming gas project.The gas is slated for export to Japan to generate electricity.This shocking news was revealed to the Lae business community yesterday by PNG Power Limited (PPL) acting chief executive officer, Tony Koiri.Mr Koiri said the energy demand for PNG was forecast to increase by 50% in two years due to extensive development of commercial, residential, hospitality and industrial infrastructure in major centres.“This demand is forecast to increase by 67% between five and 10 years as a result of the LNG project and PPL is looking at developing its hydro-power systems to meet the demand.“We are now working on improving the efficiency of hydro-power plants by implementing a number of measures to meet the growing demand for electricity,” he said.Diesel generators which PPL is increasingly relying on to provide electricity to power-starved consumers is costing the organisation far too much.Mr Koiri pointed out that the energy demand forecast on the Ramu system, based on the non-mining sector demand, was expected to increase by 30% in the next five years.“If mining loads of Ramu nickel, Yanderra, Wafi Golpu were taken into account, then the energy demand based on preliminary load figures would increase by about 300% from current figures,” he said.PPL has plans to cater for this huge increase in electricity demand with the development of the 240 megawatt Ramu two hydro-electricity project, which it is estimated to cost K1.3 billion.Mr Koiri said PPL was looking for private sector partners to develop the new system.“PPL needs to immediately make significant investments in (power) generation, sub-stations and network infrastructure to not only meet the increasing demand, but also improve the reliability and quality of supply,” Mr Koiri said in his presentation.He said PPL was engaged in major capital investment programmes costing K1.017 billion to upgrade the nation’s electricity supply system from last year until 2013.It plans to spend K322 million on hydro-generation including Yonki Toe of Dam, Rouna 1 replacement, refurbishment and upgrades to Ramu 1, Paunda and Warangoi and a new hydro-power station at Ramazon in Bougainville.Another K248 million will be spent on developing the thermal power stations, including new generation for Port Moresby and new power stations for Wewak and Kimbe.Mr Koiri said K258 million would be spent on transmission, including new sub-stations in Port Moresby and the Hidden Valley gold project transmission line.Funding for these projects will come from internally generated funds and existing borrowings.Mr Koiri admitted that PPL had been unable to provide a reliable power service, resulting in it paying rebates to customers since 2005.The reliability of supply has declined over recent years in most centres and is currently below the benchmarks set by the Independent Consumer and Competition Commission (ICCC).
By OSEAH PHILEMON
PAPUA New Guinea’s energy demand will increase by 300% over the next five to 10 years – but none of it will be met by the upcoming gas project.The gas is slated for export to Japan to generate electricity.This shocking news was revealed to the Lae business community yesterday by PNG Power Limited (PPL) acting chief executive officer, Tony Koiri.Mr Koiri said the energy demand for PNG was forecast to increase by 50% in two years due to extensive development of commercial, residential, hospitality and industrial infrastructure in major centres.“This demand is forecast to increase by 67% between five and 10 years as a result of the LNG project and PPL is looking at developing its hydro-power systems to meet the demand.“We are now working on improving the efficiency of hydro-power plants by implementing a number of measures to meet the growing demand for electricity,” he said.Diesel generators which PPL is increasingly relying on to provide electricity to power-starved consumers is costing the organisation far too much.Mr Koiri pointed out that the energy demand forecast on the Ramu system, based on the non-mining sector demand, was expected to increase by 30% in the next five years.“If mining loads of Ramu nickel, Yanderra, Wafi Golpu were taken into account, then the energy demand based on preliminary load figures would increase by about 300% from current figures,” he said.PPL has plans to cater for this huge increase in electricity demand with the development of the 240 megawatt Ramu two hydro-electricity project, which it is estimated to cost K1.3 billion.Mr Koiri said PPL was looking for private sector partners to develop the new system.“PPL needs to immediately make significant investments in (power) generation, sub-stations and network infrastructure to not only meet the increasing demand, but also improve the reliability and quality of supply,” Mr Koiri said in his presentation.He said PPL was engaged in major capital investment programmes costing K1.017 billion to upgrade the nation’s electricity supply system from last year until 2013.It plans to spend K322 million on hydro-generation including Yonki Toe of Dam, Rouna 1 replacement, refurbishment and upgrades to Ramu 1, Paunda and Warangoi and a new hydro-power station at Ramazon in Bougainville.Another K248 million will be spent on developing the thermal power stations, including new generation for Port Moresby and new power stations for Wewak and Kimbe.Mr Koiri said K258 million would be spent on transmission, including new sub-stations in Port Moresby and the Hidden Valley gold project transmission line.Funding for these projects will come from internally generated funds and existing borrowings.Mr Koiri admitted that PPL had been unable to provide a reliable power service, resulting in it paying rebates to customers since 2005.The reliability of supply has declined over recent years in most centres and is currently below the benchmarks set by the Independent Consumer and Competition Commission (ICCC).
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