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Prime Minister James Marape says the government’s Connect PNG infrastructure program is intended to transform road networks into “economic corridors” that unlock agriculture and other renewable-sector opportunities across Papua New Guinea. Speaking on the government’s nationwide road connectivity agenda, Marape said roads being developed throughout the country are designed not only to improve transportation, but also to unlock the productive potential of customary land and create sustainable income and employment opportunities for ordinary Papua New Guineans. “The Connect PNG Program focus and the Roads we are opening up should be unbundling the economic potential of every Land right across our country,” Marape said. The prime minister said the government is progressively linking provinces and districts through major road projects stretching across the country, including east-to-west Manus, east-to-west Sepik, north-to-south Bougainville, the Buka Ring Road, the Kerema-to-Alotau corridor through Port Moresby, roads linking Gulf into the Highlands, and strategic road links across Morobe, Western Province, New Ireland, and West New Britain. According to Marape, the road projects are intended to stimulate agriculture, tourism, fisheries, forestry, and downstream economic activity in areas where communities live and own land. “All these Roads, especially those closest to ports and economic centres, must be used productively,” Marape said. “Provincial Governments must work with Districts, Local-Level Governments, and Communities so that the Lands alongside these Roads become economically productive.” Marape said Papua New Guinea possesses significant untapped economic potential through its renewable sectors, particularly agriculture, where citizens can generate household income from customary land. He pointed to smallholder oil palm schemes in West New Britain Province as an example of successful rural economic participation. “You have close to 7,000 families engaged in smallholder extension around the nucleus estates, and many families are earning between K4,000 and K6,000 a month,” Marape said. “That is the type of Revenue we are talking about when we speak of Agriculture — whether in Oil Palm, Coffee, Cocoa, Copra, Fisheries, or Tourism.” The prime minister said the government’s “One Million Jobs” initiative and broader agricultural expansion programs are aimed at replicating similar success stories nationwide to enable more Papua New Guineans to participate in formal economic activity without leaving their communities. “This country must not be lazy. Money can be earned from wherever you are on your own Land,” he said. Marape described agriculture, fisheries, forestry, and tourism as Papua New Guinea’s “lowest hanging fruit” for broad-based economic growth and job creation, particularly in rural areas where most of the population resides. “These Sectors can create jobs, empower families, strengthen communities, and grow our economy in a sustainable way while we continue to expand downstream processing and other industries,” he said. The prime minister also revealed that before Papua New Guinea’s 51st Independence Anniversary on Sept. 16, the government plans to announce a policy framework that would allow properly registered customary land to be used as collateral through the National Banking Corporation and other financing mechanisms. “Properly registered Traditional Land can become bankable Land,” Marape said. He said the proposed reform would help Papua New Guineans access financing and participate more actively in agriculture, small business, tourism, and other productive sectors. Marape also called on provincial governments, district authorities, and community leaders to work closely with the national government to ensure that road connectivity translates into economic outcomes for local communities. “The future prosperity of Papua New Guinea will not only come from Mining and Petroleum, but from empowering our people to utilise their Land, Resources, and God-given opportunities in a productive and sustainable way,” he said.

Nickel 28 Capital Corp. says updated estimates for the Ramu Nickel-Cobalt operation in Papua New Guinea show higher mineral resources and continued reserve replacement following exploration activities completed in 2025. In a statement, Nickel 28 said updated mineral resource and reserve estimates provided by project operator China Metallurgical Group Corporation (MCC) reflected successful drilling and resource conversion work undertaken during the year. Nickel 28 currently holds an 8.56 percent joint-venture interest in the Ramu Nickel-Cobalt operation, while MCC and its partners own an 85 percent interest in the project. The company said its ownership interest in Ramu will automatically increase to 11.3 percent at no cost following repayment of construction debt owed to MCC. Nickel 28 also retains the option to acquire an additional 9.25 percent interest at market value, which would increase its stake to 20.55 percent. According to the company, total mineral reserve tonnage remained effectively unchanged year over year, while average nickel grades increased from 0.81 percent to 0.87 percent despite ongoing mining depletion, reflecting continued drilling success and resource conversion. Measured and indicated mineral resource tonnage increased by approximately 16 percent year over year, while average nickel grades declined modestly from 0.88 percent to 0.81 percent, resulting in an approximate 13 percent increase in contained nickel. Nickel 28 said the increases in mineral resources and continued reserve replacement were driven by exploration work completed in 2025, including 1,026 boreholes totaling 10,397 meters, primarily in Areas 4 West and 6 of the Ramu project. “The updated mineral resource and reserve estimates reflect continued exploration success and ongoing conversion of mineral resources into mineral reserves at Ramu,” Nickel 28 Chief Executive Officer and President Craig Lennon said. “At current production rates, the reserve base supports an estimated mine life of approximately 20 years, while the broader mineral resource inventory continues to provide additional long-term upside potential,” Lennon added. Separately, Nickel 28 announced that it expects to receive its tenth cash distribution from the Ramu joint venture, amounting to approximately US$2.1 million for second-half 2025 operating performance tied to its 8.56 percent stake in the project. The company also confirmed repayment of US$4 million of Nickel 28’s portion of remaining Ramu joint-venture partner construction debt, reducing its attributable balance to approximately US$31.9 million. Receipt of the distribution is anticipated during May 2026. Lennon said the Ramu operation delivered a strong operational performance in 2025, producing 33,007 tonnes of nickel and 3,099 tonnes of cobalt contained in mixed hydroxide precipitate, while sales totaled 32,627 tonnes of nickel and 3,061 tonnes of cobalt. According to the company, average realized nickel prices during the year reached US$6.88 per pound, while cobalt prices averaged US$16.07 per pound. Nickel 28 said operations in 2026 have started positively, with production tracking in line with targets and nickel and cobalt prices trending above 2025 averages. However, the company noted that rising sulphur prices continue to place pressure on operating margins for high-pressure acid leach operations globally, including in Indonesia. The updated mineral resource and reserve estimates were prepared by the Nanjing Center of the China Geological Survey according to the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves, with an effective date of Dec. 31, 2025. Nickel 28 cautioned investors that the updated estimates were not prepared in accordance with Canada’s National Instrument 43-101 standards for disclosure of mineral projects. The company added that independent consulting firm RedDot3D Inc. conducted a site visit to the Ramu operation in 2022 to review drilling procedures, quality assurance practices, and mining activities, with Nickel 28 stating that the updated report appeared consistent with those observations. The Ramu Nickel-Cobalt operation is one of Papua New Guinea’s major nickel and cobalt projects and is operated by MCC through Ramu NiCo Management.

Kumul Petroleum Holdings Limited says it is seeking to advance smaller gas discoveries toward commercial development as Papua New Guinea moves to position itself within the global energy transition. Speaking at the 41st Australia Papua New Guinea Business Forum and Trade Expo in Brisbane, Kumul Petroleum Chairman Gerea Aopi said Papua New Guinea still holds significant gas potential despite declining oil production. “Whilst oil production has tapered off, PNG’s gas future is just beginning,” Aopi said. “There is plenty of gas already discovered and a high likelihood of further gas discoveries in the next few years. PNG is not short of gas resources, however, we are short of time in the rapid transition towards renewable energy sources.” Aopi said Kumul Petroleum is currently in discussions with other parties regarding licenses where gas discoveries have already been made, including Petroleum Development License 10 in Western Province. The chairman said the company wants to ensure that smaller gas fields are also progressed toward development in the years ahead alongside larger LNG projects. As a 19.4 percent owner in the PNG LNG Project, Aopi said Kumul Petroleum welcomed the early retirement of project debt late last year. “Our priorities are clear: This additional PNG LNG Project income will be used to meet our cash calls, repay outstanding loans, and develop the licences where we are Operator — Pandora, Kimu, Barikewa and Uramu — to commerciality and fund future investments, such as acquiring equity in the forthcoming Papua LNG Project,” he said. Aopi added that one of Kumul Petroleum’s main priorities is securing Papua New Guinea’s maximum mandated equity position in the Papua LNG Project. “Kumul Petroleum’s principal focus at present is ensuring that we are in fact in a position to take up PNG’s maximum mandated equity position in the forthcoming Papua LNG Project and are able to carry MRDC in this shareholding,” he said. According to Aopi, the key challenge for Papua New Guinea is not the availability of energy resources, but the speed and manner in which those resources are developed. “The key message was not that PNG lacked the energy resources to drive growth but how the resources were developed and how soon,” he said.

The Sepik Development Project (SDP) continues to record strong progress in stakeholder engagement while expanding employment opportunities for Papua New Guineans, with a clear focus on benefiting communities in the Sepik region. Project representatives from the community affairs team, whose dedicated role is to meet with and listen to local communities, recently visited near-mine communities, including those in the Upper Sepik, where they held constructive engagement sessions about project plans and new opportunities. The consultative engagement is part of an ongoing schedule of positive engagement with landowners, local communities, government agencies, and other key stakeholders, reflecting the Project’s commitment to transparency, partnership, and responsible resource development. Country Manager Dr Joel Hamago said the strength of stakeholder relationships established to date demonstrates the Project’s long-term commitment to Papua New Guinea. “We are encouraged by the collaborative approach we are seeing on the ground, and we remain committed to open dialogue and mutual respect as the Project progresses,” Dr Hamago said. “Meaningful engagement with our host communities, based on transparency and accurate information, is central to how we operate.” Dr Hamago called on opponents of the Project to adopt the same commitment to accuracy and honesty in their actions. “It is disappointing to see a recent media publication where Project Sepik continues to misrepresent the outcome of the SDP’s recent engagement with Sepik communities via the OECD’s AusNCP referral process, where an independent examiner confirmed our compliance with OECD guidelines in relation to stakeholder engagement on this project.” Dr Hamago said community engagement activities would continue. “While we have had an overwhelmingly positive response from communities, which value the level of engagement and the future opportunities from the Development, we understand that many people still have concerns and questions, which is why we will continue to listen as we consult with them." Employment Growth and Opportunities for Sepik Communities As activities continue to advance, the Sepik Development Project has opened a number of new employment opportunities across various roles, which are currently advertised on the Project’s official LinkedIn page. In line with the Project’s localisation strategy, priority will be given to suitably qualified applicants from the Sepik region, ensuring local communities are directly involved in and benefit from Project development. “Our employment strategy is deliberately focused on local participation,” Dr Hamago said. “Wherever possible, we want people from the Sepik to take up these roles, gain valuable skills, and become part of the Project’s journey from the early stages.” Supporting PNG’s Local and National Content Agenda The Sepik Development Project strongly supports the Papua New Guinea Government’s drive to increase local and national content within major resource developments. Through targeted recruitment, training, and skills development, the Project aims to create sustainable employment outcomes and contribute to long-term national capacity building. “This Project is about more than just mining. It is also an infrastructure project with rippling opportunities,” Dr Hamago said. “It is about building capability, supporting PNG talent, and ensuring that Papua New Guineans are well positioned to participate meaningfully in major developments, both now and into the future.” How to Apply Interested applicants are encouraged to view current vacancies and application details via the Frieda River Limited LinkedIn page. Applicants should carefully review role requirements and ensure their qualifications and experience align with the advertised positions. The Frieda River Project will continue to provide regular updates on stakeholder engagement, employment opportunities, and Project milestones. Frieda River Limited is the proponent of the Sepik Development Project (SDP) in Papua New Guinea. The SDP comprises four integrated components: the Sepik Infrastructure Project (SIP), the Frieda River Copper-Gold Project (FRCGP), the Frieda River Hydroelectric Project (FRHEP), and the Sepik Power Grid Project (SPGP). The Project is designed to deliver enabling infrastructure, including power generation and transmission, road access, airport and port facilities, supported through private investment. During operations, the SDP is expected to create approximately 2,500 direct jobs, with a target of 93 per cent national employment, and generate more than 30,000 indirect employment opportunities. The Project incorporates engineered tailings and water management systems, as well as a hydroelectric power solution intended to reduce operational emissions and support environmental management objectives, including protection of the Sepik River system. Frieda River Limited is a significant subsidiary of the PanAust Limited Group. Along with pre-development opportunities in Papua New Guinea operations, PanAust Limited also owns Phu Bia Mining, an award-winning dual operation in Laos, and has development opportunities in Chile. An Australian-incorporated company, PanAust is owned by Guangdong Rising H.K. (Holding) Limited, which is a wholly owned subsidiary of Guangdong Rising Holding Group Co., Ltd. (GDRH). GDRH is a Chinese state-owned company regulated under the State-owned Assets Supervision and Administration Commission of the People’s Government of Guangdong Province in China.

Prime Minister James Marape says major road infrastructure developments in West New Britain Province are demonstrating how transport connectivity can stimulate agriculture and broaden economic participation across Papua New Guinea. Speaking after travelling along the improving road corridor linking Kimbe in West New Britain Province and Kokopo in East New Britain Province, Marape said the expansion of oil palm developments alongside the road network showed how infrastructure investment could unlock economic opportunities for local communities. “It is good to see that the new Road, or the improved Road we are doing from Kimbe to Kokopo, is taking shape,” Marape said. “But more importantly for me, this Road is opening up Agriculture potential. It is encouraging to see Oil Palm growing along the sides of the Road. This shows clearly that when Government invests in Roads, Agriculture must expand alongside it.” The prime minister said the road corridor is improving connectivity between West New Britain and East New Britain while also creating opportunities for rural landowners, farmers, and local businesses to participate more actively in economic activity. Marape also acknowledged the efforts of the West New Britain Provincial Government, local districts, landowners, and oil palm stakeholders, including Hargy Oil Palms Limited, for supporting development initiatives linked to the national government’s infrastructure investments. “I want all Provincial Governments to observe what East and West New Britain are trying to do. They are aligning Road development with Land access and getting their people involved in Agriculture development,” Marape said. According to the prime minister, the visible expansion of oil palm developments along the road corridor demonstrates how infrastructure projects can encourage productive use of customary land while generating income and employment opportunities for local communities. “This is a clear depiction that some Provinces are embracing the National Government’s development direction — where Roads go, Agriculture must follow,” he said. “Five years ago when I travelled this area, there was no sealed highway or extended Oil Palm areas as it is now. So I am happy this economic development is taking place.” Marape stressed that roads should not function solely as transport corridors, but also as catalysts for broader economic activity in agriculture, tourism, fisheries, forestry, and other productive sectors. “May this Road not be wasted. May this Road become an Agriculture road, a Tourism road, a Fisheries road, and a Forestry road,” he said. The prime minister said the Marape-Rosso Government remains committed to the Connect PNG program, which aims to strengthen national connectivity through modern infrastructure while ensuring that economic activity expands alongside infrastructure investments. “The Road investments we are making must translate into real opportunities for our people. Roads must connect our citizens not only to each other, but also to markets, jobs, services, and economic participation,” Marape said.

BSP PNG | BSP says small and medium-sized enterprises (SMEs) need to build capability to take full advantage of the opportunities that will be created through the coming super-cycle of PNG resource projects. Speaking at the 41st Australia Papua New Guinea Business Forum Conference in Brisbane, BSP Head of Business Banking Raymond Logona said building capability was essential for PNG businesses to maximise the benefits arising from the country’s next wave of major resource developments. “We know that in the next decade there will be major opportunities for PNG businesses as major projects are developed, such as the Papua LNG Project, the Wafi-Golpu Project, the Frieda River Copper-Gold Project, and energy projects in Bougainville and Port Moresby. “Together, these projects present a super-cycle of opportunity for small and medium-sized enterprises in PNG. However, to take full advantage, businesses need to start working now on their business strategies and the capabilities required to support these major investments. “BSP has recognised the opportunity to support our business customers. We launched our dedicated Business Bank last year and are investing K1.2 billion in a multi-year programme to modernise the BSP Group for growth. “This includes upgrading our technology and digital channels and creating world-class products and services to support the growth of small and medium-sized enterprises. “We are also investing through our partnership with Australian Business Volunteers (ABV) to deliver the YES GROW programme, which is designed to build capability among our SME customers so they can use new digital tools, manage cash flow, and make better use of finance to prepare for growth opportunities. “For example, through our partnership with ABV, we currently have a YES GROW Business Development Programme workshop underway in Lae, with 18 local PNG SMEs from the agriculture, construction, electrical, transport, and retail sectors attending. “This group joins more than 600 small businesses across PNG and the South Pacific that have strengthened their capability through the programme’s intensive training and personalised coaching. “These skills are vital for businesses seeking to take advantage of the opportunities being created by PNG’s continued economic growth and the coming super-cycle of resource and infrastructure projects,” Logona added. Logona was joined by ABV Chief Executive Officer Liz Mackinlay, who highlighted the achievements of the partnership. “ABV is proud to be partnering with BSP to help SMEs transform their enterprises for sustainable growth, positively impacting the wider economy and supporting their families and communities into the future. We look forward to bringing the YES GROW Programme to Bougainville later this year,” Mackinlay said. Since its inception in 2018, BSP’s partnership with Australian Business Volunteers has provided intensive, practical training and personalised mentoring to more than 600 small businesses in the South Pacific, including 400 in Papua New Guinea across 19 sectors. According to BSP, investing in the YES GROW initiative is a strategic response to the operational challenges facing small business owners and the local economy. The YES GROW model, co-designed by ABV and BSP, is specifically tailored to address the realities of the PNG market, including foreign exchange (FX) pressures, rising costs, and infrastructure constraints. Participants emerge from the programme with an advanced understanding of commercial requirements, improving their ability to navigate economic challenges, manage operations successfully, and achieve long-term business goals. BSP is the Magic Diamond sponsor of the Forum Registration Desk at the 41st Australia Papua New Guinea Business Forum, which was held in Brisbane from Wednesday, 13 May, to Friday, 15 May 2026.

Missionary Aviation Fellowship (MAF) has played a critical role in supporting Papua New Guinea’s rural economy and national development through its aviation services over the past 75 years, according to Civil Aviation Minister Wake Goi. Speaking during MAF’s 75th anniversary thanksgiving service in Mount Hagen, Western Highlands Province, on 7 May 2026, Minister Goi described MAF as “a lifeline to the most remote and isolated communities across our country.” He said that, in a nation defined by rugged terrain and limited road infrastructure, the organisation had “consistently bridged the gap, bringing hope, connection, and opportunity where it is needed most.” The Minister said MAF’s services extended beyond aviation operations, highlighting its role in transporting medical supplies, assisting vulnerable patients, supporting education services, and delivering essential goods to rural communities. “Your contributions in airlifting medical supplies, transporting the sick and vulnerable, supporting education services, and enabling the delivery of essential goods have transformed countless lives,” he said. Minister Goi also highlighted the organisation’s contribution to rural economic participation, saying MAF had helped connect farmers and small businesses to markets, allowing communities to engage more meaningfully in national development. “MAF’s role in connecting rural farmers and small businesses to markets has also strengthened local economies, empowering communities to participate meaningfully in national development,” he said. “This is not merely aviation; it is nation-building at its most practical and compassionate level.” He acknowledged MAF as a strategic partner in supporting the mandates of the Rural Airstrips Agency (RAA), saying its continued operations complemented government efforts to maintain and expand rural airstrip infrastructure across the country. “As Minister for Civil Aviation, I also acknowledge MAF as a key strategic partner in advancing the mandates of the Rural Airstrips Agency,” he said. “Your continued operations complement government efforts to maintain and expand rural airstrip infrastructure, ensuring that no community is left behind.” Minister Goi also recognised MAF’s long-standing support for churches and Christian missions in Papua New Guinea, saying the organisation had contributed significantly to strengthening faith, hope and unity in remote communities. He reaffirmed the Government’s commitment to working alongside MAF to improve aviation services and expand access to rural populations. “May the next 75 years of MAF’s service be even more impactful, as together we build a more connected, inclusive and prosperous Papua New Guinea,” he said.

   Petroleum Resource Development Michael McWalter writes about petroleum development in its widest sense and the finding and extraction of oil and gas resources from the ground to sell them to make money, provide energy and feedstock, and the various roles and responsibilities of stakeholders and their inter-relationships. What is Petroleum Development? In broad terms, petroleum development is the overall process of finding, extracting, and refining oil and gas from the Earth, often collectively called petroleum, or otherwise hydrocarbons, though this latter term includes coal. Sometimes, we more strictly reserve the term petroleum for crude oil which derives from combining the Latin words petra meaning rock and oleum meaning oil, hence rock oil. But oil scarcely ever comes without some contained or associated gaseous hydrocarbons, which are often termed natural gas, or simply gas. Some fields contain mainly gas and just a few of what we call wetter (liquid) hydrocarbons, which we can extract from the gas such as condensate and natural gas liquids. Papua New Guinea has some oil, but considerably more gas. Figure 1: A typical black crude oil, after Wikipedia. Figure 2: Natural gas burning on a stove; natural gas is colourless, but in the right proportion with air, it will burn at high temperatures causing ionisation of the molecules and blue light emission, after Freepic. Once extracted, these substances have many uses, primarily as a source of energy, but also importantly as feedstock for the petrochemical industry. Oil and gas thus have very useful economic value, so we regard them as a resource which has a market price once they are extracted, processed and made ready and available for sale to customers. Petroleum resource development involves a complex and expensive process of exploration, drilling, discovery and appraisal, development and production, followed by the refining of the produced petroleum fluids, classically by distillation and other processes to make specification petroleum products with which we are all familiar. In the case of oil, these are typically: gasoline (petrol); kerosene; jet fuel; diesel; heating oil; solvents; lubricants; asphalt; and paraffin wax. Whilst for gas these are typically: reticulated gas; LPG (liquid petroleum gas) or bottled gas; and piped natural gas or Liquefied Natural Gas (LNG) for the long-distance transportation of natural gas. There are also other products, which we seldom see, such as heavy fuel oil, or which serve as intermediate feedstocks, such as: naphtha; ethane and propane. Figure 3: Typical products from crude oil, after Secondary Science 4 All.    It All Begins with Exploration  Exploration is an exhaustive, expensive and often high technology process. It is predicated on the essential and necessary ingredients being present that may have helped the rock strata and its contents to form gaseous and/or liquid accumulations in the subterranean rocks of the Earth. The process develops over millions of years as that organic matter contained in the rock strata under successive layers of overburden rock is transformed by heat and pressure into oil and gas. The ingredients in that process are:  an organically rich source rock which, when deeply buried and heated, generates petroleum; the movement by dint of buoyancy of that generated petroleum from the source rocks through rock strata until it is caught and trapped in a reservoir, rather than leaked to the surface; a reservoir rock that has not only sufficient porosity (space between its grains) to contain that petroleum, but adequate connection between those pore spaces to permit that petroleum to flow if tapped by a well drilled into the reservoir; a closure or trap formed by the structural configuration of the rock strata that either through folding, faulting or stratigraphic pinch-out defines a place within which petroleum may accumulate; and  a seal or containment that acts as a barrier to the upward flow of petroleum created by impermeable rocks and structures which prevents further upward movement and escape of the petroleum. Figure 4: The essential ingredients for the formation of conventional petroleum accumulations, after AAPG.  Papua New Guinea as a Petroleum Province Papua New Guinea is not short of any of these ingredients. Indeed, the geology of Papua New Guinea is quite conducive to creating accumulations of petroleum, but all the essential ingredients have to be found in the correct sequence and occur at the right time. Accumulations also have to contain significant petroleum resources that may make their exploitation worthwhile, and can deliver what we call recoverable reserves. In Papua New Guinea, we have many surface seeps of oil and gas across the country, which provide evidence of the generation of petroleum in the subsurface, and its migration and seepage to the surface in discrete places. Whilst such seepages indicate the presence of oil and gas, they also show that it is leaking to the surface. Oil and gas men look for accumulations that have been preserved intact deep in the rock strata, without such leakage, into which they may drill deep wells to tap the oil and gas in quantity, if they can find some. We have obvious and abundant folding and faulting of rocks and the right kind of rocks, both permeable and porous sandstones and limestones to serve as reservoirs, and abundant mudstones and shales to serve as sources and seals. The critical question is specifically where to look for a petroleum accumulation. Figure 5: An active gas seep of methane, ethane, propane and butane from the seabed identified during the survey of the MV Sonne, off Lihir Island, New Ireland Britain, after Brandl, P.A., Sander, S.G., Beier, C. et al. Sci Rep 15, 32389 (2025).   The Value of Petroleum  Oil and gas are not like gold. A barrel of crude oil, which is approximately 159 litres, currently (as of late February 2026) sells for about US$ 65, or PGK 278, or about US 40 cents per litre, or PGK 1.75 per litre.  A litre of crude oil is not going to make you rich, whereas a litre volume of gold would weigh a staggering 19.3 kgs (equivalent to 620 troy ounces) and be valued at an equally staggering amount of US$ 3.1 million or PGK 13.4 million at a gold price of US$ 5,000 per troy ounce. The petroleum business is a very different game to that of the gold business. A small surface seepage of natural gas or oil is scarcely of any value, and more a local curiosity.  The discovery of an accumulation of oil and gas thus has to be large and extensive to make it worthy of future development and recovery. Accordingly, oilmen select their exploration prospects, for what we term wildcat drilling, most rigorously and carefully. Wildcat drilling is high-risk exploration for oil and gas in unproven, unmapped, or abandoned areas lacking, or far from, existing oil and gas production, often without any historic discovery or prior production. Oilmen screen the geology of an area for the necessary ingredients (described above) and particularly for large geological structures that may potentially contain significant volumes of oil and/or gas, if such have indeed accumulated in their target structure. Figure 6: Oil and money, but at just US$ 65 per barrel, only large scale production can normally cover the costs of finding and extracting it.       Oil production from a field, from which say, 100 million barrels of crude oil can be recovered, might at a crude oil price of US$ 65 per barrel have a sales value of US$ 6.5 billion, but not all of that can go into the oil man’s pocket. For example, it might have taken five wells to make the discovery and a further five wells to appraise the lateral extent of the field and another thirty wells from which the oil may be recovered. These forty wells might have cost an average of US$ 25 million each, making discovery and appraisal costs about US$ 1 billion. The development of the field will require field processing facilities to clean up the oil to acceptable standards and specifications to make it fit for transportation, and likely a pipeline or set of pipelines to convey the oil to a terminal at which ocean-going oil tankers can load the crude oil for export. This may cost another US$ 1.5 billion. And then there are operating costs. To run an oil field and produce the crude oil safely, responsibly and prudently, there are daily operating expenses for manpower, machinery and materials. These may amount to US$ 100 million per year for twenty years. As you can see, the prize of finding the oil field is shrinking. And then the Government will want to ensure it is getting its agreed and defined share of its resource as the owner, typically at least 50% or more of the net value. One can see quite readily how the revenue arising from the 100 million barrels is whittled down. The oil companies might retain US$ 1 billion from this enterprise after recovering their costs, whilst the host government might make a similar amount. Naturally, each and every petroleum project has a different set of reserves, costs, and outcomes. Satisfying basic economics that the recovery of oil from the field is viable is the primary concern, and then having a firm and fair arrangement for the sharing of the net value of the produced petroleum is most desirable. Exploration and Discovery Risk The drilling of exploration wells only comes after extensive and expensive exploration surveys by geologists and geophysicists studying the rocks and their configuration at the surface and probing the subsurface with a variety of geophysical techniques. The most common geophysical technique deployed is the acquisition of seismic images of the subsurface, a bit like an ultrasound scan might be made of your stomach by a doctor, though on a vastly larger scale. Sound waves are sent into the ground, or the sea, if exploration is being conducted offshore, and the reflections from the layers of rocks are detected by a multitude of special microphones called geophones. The jumble of signals is organised and processed by elaborate computer programmes so as to create a layer-cake image of the configuration or structure of the subsurface rock strata. Knowing the velocity of sound through the rocks, the geophysicists can interpret these images of the subsurface and make depth maps of potential trapping structures. It is a tedious and expensive process which is not at all easy in the jungle-wrapped, mountainous and often swampy terrains of much of Papua New Guinea. Combined with surface geological descriptions of the visible outcrops of rocks and their faulting and folding, the petroleum geologist will attempt to define leads and prospects which may be promoted for wildcat drilling. Already in this process, tens of millions of dollars will have been spent on physical surveys, data processing and geophysical and geological interpretation. Figure 7:  A seismic reflection image of part of the Gulf of Papua called the Flinders Basin showing the underlying subtle faulting and folding of the strata, after PNG Chamber of Mines and Petroleum.    The company then has to evaluate its portfolio of prospects, both within the country in which it is exploring and globally, and make a choice as to which prospects in which countries it will prioritise and commit to drilling. It does this on a risked basis and then applies the economics of the applicable national petroleum regimes to make an assessment as to whether it might be possible to make money. It is always a risky business, akin to making an expensive movie, which may be a success or a failure. Some liken it to gambling in a casino, because of the intrinsic uncertainty of the subsurface geological history. However, oil and gas companies shrewdly assess all the risks involved. Drilling the Ultimate Gamble There are fundamental geological risks as to whether an accumulation of petroleum may be present within a prospect. Alas, the only way to find out whether a prospect contains oil and/or gas is to drill the prospect. The chance of discovering oil and gas depends much on the type of well, with success rates for wildcat exploration wells typically ranging from 10–20% in new frontier areas to a global average of between 30–40%. Approximately 60–70% of initial exploration wells fail to find accumulations with quantities adequate for commercial development and production. In known petroliferous areas and where development drilling is taking place near to or on known accumulations, the success rate can be as high as 80% to 90%. Those petroleum provinces in well-established producing nations thus present much less risk than hitherto undrilled provinces where little or no drilling has previously taken place. Figure 8: A drilling rig in the Highlands of Papua New Guinea, after PNG Business News.    The risk of discovery is skewed by perceptions of the host nation’s petroleum endowment, and so the host Government necessarily has to adjust its terms and conditions of petroleum development up or down depending on the likelihood of discovery. Drilling a wildcat well in the Seychelles, where only four wells have previously been drilled without success**,** is a very different game from drilling a wildcat well in Libya**,** where more than 1,500 wells have been drilled over the last 70 years with more than 500 oil and gas discoveries. Hence, the Government of the Seychelles might have to offer the most attractive terms to encourage the international oil and gas companies to explore in its territory rather than in other perhaps more petroliferous places. In Papua New Guinea, the total number of real wildcat wells is less than 275 spread out over the last hundred years. The Wohumul boreholes were drilled in the Oriomo River area of the Western Province, near Daru in 1925; these were shallow tests. The first deep well in Papua New Guinea was drilled at Kariava-1 in the Gulf Province. Interestingly, this well was spudded on 8th March 1941, suspended in 1942 due to World War II**,** and resumed drilling in 1946 before being abandoned in 1948. Exploration for oil in Papua New Guinea is not a new game; it has taken place for decades with tantalising results that have taunted many an oilman. It was only in 1986 that significant success was obtained at the Iagifu 2-X well when Niugini Gulf Oil, which became part of the Chevron Corporation as Chevron Niugini, found a significant accumulation of black oil near Lake Kutubu**,** which gave rise to the Kutubu Petroleum Development Project in 1990. Hitherto, nothing of commercial significance had been found and no development or production of oil and gas had been commercially undertaken. To date, Papua New Guinea has discovered oil and gas in dozens of prospects**,** at least half of which have been made the subject of development and production operations recovering both crude oil and natural gas in commercial quantities. Figure 9: Oil and Gas Reserves of Papua New Guinea, after Manau, August 2021 modified.      Factors Affecting Petroleum Development Finding an accumulation of oil and/or gas is a great feeling for the oilman, but unless the volume of the accumulation is large enough to be commercially exploited by development and production operations, it cannot recompense the company for the considerable expense of finding it. The cost of drilling a well very much depends on its location and its distance from supply chains and support facilities. Papua New Guinea remains a remote place for petroleum development operations of all kinds, being far from major petroleum development hubs. Much of Papua New Guinea remains a frontier petroleum province, notwithstanding 34 years of crude oil production and 12 years of gas production and LNG export. Put quite simply, Papua New Guinea is not Texas, where over 1.5 million wells have been drilled and between 157,000 and 187,000 wells are active. The presence of abundant civil and petroleum infrastructure in Texas makes the cost of petroleum development vastly lower. While high-production wells currently dominate production, thousands of older, "stripper" wells across Texas produce less than 10–15 barrels per day – not an unreasonable income if privately owned and the crude oil is able to reach the market readily through a convenient nearby pipeline. It is a very different story in Papua New Guinea, in which civil infrastructure is scarce and petroleum infrastructure is project-specific and sparse. A frontier province is an unexplored or underexplored geological region with suspected, but unproven, significant petroleum resource potential. Such is the case of the deep waters of the Coral Sea where TotalEnergies and Petronas plan to drill the Mailu-1 deepwater well soon, targeting Eocene carbonate reservoirs. Such a deepwater well is likely to cost about US$ 100 million for an estimated drilling period of less than two months. Such risks are not for the faint-hearted. It has been said that the drilling of absolutely rank wildcat wells in a petroleum basin where no prior exploratory drilling has taken place is indeed a bit like going into a casino for the first time, but bypassing the slot machines and going straight to the high-stakes tables! Of course, whether a sedimentary basin holds petroleum accumulations or has even generated oil and gas is not always certain. Sometimes subsurface conditions are not correct, or in the right order. Sometimes, there is no sign of any oil or gas seeping to the surface. It can be very much a blind gamble. But once a discovery is made in a newly explored basin, most often the herd of oil and gas companies come charging in. Getting that critical breakthrough of the first discovery is very important, not only for the exploring company which is investing in that exploration effort, but also for the host government which wishes to elucidate its petroleum prospectivity fully. Figure 10: The steps of petroleum resource development, after Valerie Marcel.  The Government Role Many governments around the world shy away from all but the very basic pursuits of oil and gas exploration because of the considerable expense and enormous risks.  They may obtain some seismic reflection surveys, particularly in offshore areas, either though bilateral aid and/or by speculative surveys conducted by seismic survey contractors who will pay for the survey and then promote the resultant data and provide a royalty or profit share to the government.  This may initiate exploration interest from established oil and gas companies and, of course, scientific interest from academia which will now have new knowledge about the geological subsurface arising from those surveys.   Governments typically offer their unexplored areas for exploration by competent oil and gas companies either by the grant of licenses or contracts.  That competency is not just technical, but includes corporate, environmental, financial, safety and social capacities; all are required at some stage during the cycle of petroleum development.  It is for these strengths that host governments tend to engage the international oil and gas companies; they know what they are doing.  But equally important, the host government needs to hold them strictly to account, most assiduously, and if deficiencies emerge, sanctions and penalties should be applied. A host government needs to rise to the challenge of the companies that it engages through licences or contract by having a highly competent petroleum regulatory organisation of its own, the staff of which should be very well rewarded for being guardians of the treasure of the nation’s oil and gas resources. Government objectives are primarily monetary; to translate the value of its petroleum resources into revenue which can then be used for the national development agenda. But equally, governments do not like to be kept in the dark, so quite often they participate, not in exploration, but in development and production by taking a stake in the petroleum project. Papua New Guinea has a legal option to participate up to 22.5% all petroleum projects.  This brings valuable inside knowledge of the development to the host government, and further revenue. There are other aspects of a petroleum development though, which need to be fostered.  For many nations, a critical issue is the security of supply of oil and gas to the economy. For all nations, keeping as much of the business within the country is an important issue, making sure local people are employed and contracted, and local business are contracted for goods and services as far as is possible.  This should not just be a political wish, but a coordinated effort by company and government alike to do what is possible, and assess what may be feasible with incentives and capacity building.  Figure 11:  Fabrication at a local engineering firm in Nigeria, after Jarander.   The investing companies normally meet the costs of basic exploration and are required to culminate their exploration programmes by selecting prospects where petroleum accumulations may have been formed, and then drilling them to test whether there are indeed any.  These agreed exploration programmes are the work commitment of the companies to their host government. Failure to undertake and complete the work typically results in cancellation of the licence or contract.  Sometimes, the company simply quits for one reason or another. They may simply not be successful in finding structures eligible for the considerable expense of drilling. There may be inadequate evidence of the potential for an accumulation, or there may be better prospects in other areas which the company is exploring, either in the same country, or elsewhere.  The oil and gas company will maintain a portfolio of exploration areas around the world and seek to optimise overall exploration risk and invest in drilling its best prospects.    If a company cannot fulfil its work programme, it normally has to depart and surrender the area back to the government, sometimes with penalties. This enables the host government to give the area to another company, which may have different ideas, theories, understanding and appetite for the petroleum geology of the area.  What governments hate is when companies sit on a prospective area without doing any work, hoping that the holders of adjacent areas will have success in discovering oil and gas and so elevate the value of their area. This is pure speculation and should be discouraged; it defies the intent of the government in granting the licence or contract in the first place for valid exploration work to be done. Of course, when a new petroleum province opens up after a discovery has been made, the herd mentality of the oil and gas industry is such that everyone rushes in to try to get a slice of the action.  This enthusiasm borne out of discovery needs to be captivated by the host government and it should be used to entice more exploration investment. Naturally, the best indication of the likelihood of the discovery of further oil and gas accumulations is an adjacent discovery; it certainly boosts the prospectivity of nearby areas. So governments need to be agile in their thinking and promotion of their petroleum resources for development.    Petroleum Rights    Apart from private lands in the USA, almost all petroleum rights around the world are held by the host sovereign government.  The USA is the odd one out; it has tied subsurface mineral rights to surface rights in private lands, though it retains control and ownership on Federal lands and offshore. Thus, across the world the government is normally the owner of the petroleum as it exists in the ground. In using the prowess and capabilities of the oil and gas companies to explore, the host government has to make sure it is rewarded as the guardian of the oil and gas resources that may lie in its territory. The oil and gas companies foot the bill for exploration, but if they are unsuccessful, they go home empty-handed. After the initial discovery of recoverable black oil at Kutubu in 1986, droves of oil and gas companies took up areas for exploration in Papua New Guinea, but only a few had success. Amongst those that came to Papua New Guinea, but left empty handed were: Conoco, Shell, Phillips, Pennzoil, Statoil, Mobil, Amoco, Marathon, Petrofina, Santos, Woodside, Union Texas Petroleum, and many a smaller company.   Some came and were successful in one area, but not in others. Some sold out their share of discoveries before development activities commenced, not having the commitment, will or ability to stay though development to production. Some departed, came back, departed and came back again; one could say that such companies were quite flexible and mobile in their thinking!   It is important to remember that the rights to conduct petroleum operations are typically exclusive over a defined area or tenement and finite in term after which they expire.    Figure 12:  A map of petroleum tenements in Papua New Guinea circa late 2025, after the National Petroleum Authority.  The Petroleum Regime   Petroleum rights are licensed or contracted out to competent companies by a host government under defined term and conditions normally articulated in law, regulations, contracts and licences. Alas, the real substance of these terms and condition only comes into effect after discovery. If the companies are successful and find accumulations that are worthy of commercial extraction, they are subject to regimes in which they share a substantial proportion of that value with the host government. Petroleum regimes are a fundamental exercise of the sovereignty of a nation over its petroleum resources that may have value if they are recovered in quantity as recoverable reserves. Oil and gas in the ground have little value if they cannot be recovered to the surface and sold for value. It is upon this extracted value that petroleum regimes are assessed and implemented.  There are many different methods for the host government to extract value: by the charge of rents, royalties, levies, bonuses, duties, and fees; taxation on income; taxation of employees; withholding taxes on interest payments and dividends; the take-up of equity by the government in a project for the production of oil and gas; the sharing of petroleum production; domestic supply obligations at discounted prices; and local content provisions. These provisions are normally established by law, contract, agreements and/or licence conditions prior to the commencement of exploration activity and most certainly before production operations commence to provide certainty to both the investing oil and gas companies and the host government.  Such fiscal design should attempt to cover all likely scenarios, but often precedence and political emotions distort clear thinking. Figure 13:  Fiscal design can be quite daunting, after Dan Johnston. The broad objectives of a petroleum regime are to reduce uncertainty; present a clear picture of the applicable commercial and tax terms, limit negotiations on tax issues, provide fair and equitable tax treatment for all investors, avoid double taxation and assure that the international oil and gas companies can obtain home country foreign tax credits for taxes paid overseas.  The general rule seems to be that the more attractive the resource base is, the tougher the fiscal and commercial terms of the host Government tend to be.  Of course, many other factors come into play, not the least of which is the remoteness of the place.    Take for example the Falkland Islands where despite discovering oil in 2010, the companies only made a final investment decision for the Rockhopper oil field in late 2025 with first oil planned for 2028.  Its remoteness from supply chains of any kind, let alone oil field supply chains and concerns about the Falklands ability to remain unaffected by Argentinian claims prolonged the progress towards field development.  Papua New Guinea suffers from a similar remoteness, with Singapore and certain bases in Australia being the nearest supply depots for oil and gas operations. Also, there is inadequate petroleum exploration to keep drilling rigs and other oilfield exploration equipment permanently busy and stationed in Papua New Guinea, necessitating their importation repeatedly and sporadically for isolated exploration campaigns.     Access to Land   Papua New Guinea also remains very much an under-tested frontier oil and gas province with comparatively low exploration density, but with reasonable success in locating oil and gas accumulations.  It is still attractive for exploration due to having significant and demonstrable oil and gas generation.  Other specific factors come into play as they do anywhere.  In Papua New Guinea, adherence to customary land tenure means that even though the State asserts its ownership rights of oil and gas in the subsurface, both the oil and gas companies and the State have to gain access to exploration areas, by dealing with the local landowners and entering onto their land. Their title to their land is undocumented, unalienable and enduring, and the companies and State have to treat with the landowners most carefully.  Figure 14: Landowners look on outside a petroleum operations camp, after Celine Rouzet. The hopes and expectations of landowners are heightened as and when oil and gas are found on their land, as might be expected anywhere. If the discovery is large enough to warrant development and subsequent production, quite clearly the customary landowners will be affected.  In Papua New Guinea unlike more despotic places, where landowners might be forcibly removed and shunned away, there are legally defined provisions by which the landowners may share in the process and benefits of petroleum development. Even at the exploration stage, the oil and gas companies are strictly required to pay compensation for their entry on or occupation of the land. Moreover, the companies have to undertake social mapping and landowner identification studies to ensure that they are dealing with the correct people.  By law, neither party is to interfere with the rights of the other. The companies have the right by law to enter and occupy land reasonably required, but without interfering with the existing use to any greater extent than necessary, and they may not interfere with fishing or navigation. Landowners for their part, may not enter on, occupy or interfere with any land being used for petroleum operations. These are as much responsibilities as rights for each party.             When development commences, the companies are encouraged to use as much local labour and content as possible. The Government typically provides the local community with business development grants to help the landowners participate.  Whilst National Content has been rightly emblazoned in Papua New Guinea Government policy in recent years, there have been provisions in the Oil and Gas Act, 1998 for domestic procurement obligations upon the companies for almost three decades. These require the use and purchase of goods and services supplied, produced or manufactured in Papua New Guinea whenever the same can be obtained at equivalent terms; encouraging and assisting citizens who are desirous of establishing businesses providing goods and services; and making maximum use of Papua New Guinea contractors and subcontractors. Alas, little emphasis has been made on enforcing this, let alone making regulations to give effect to the provisions or even examining compliance by companies.      Additionally, the Oil and Gas Act specifically defines benefits for the landowners and also for the affected Local Level Governments and the Provincial Governments when petroleum development proceeds to production of oil and gas.  These variously comprise: royalty benefit; equity benefit; development levy; other project benefits; and project grants. Whilst the Act generically specifies beneficiaries, these grants and benefits still need to be shared out and it is for this that the Act requires the Government to hold a development forum to which representatives are invited from all community stakeholders. This is an excellent, though exhaustive process, but one that far exceeds the treatment of people in petroleum areas in many other nations.  Papua New Guinea should be proud of this legally enshrined sharing and consultative process and it should be implemented with utmost care and concern.   Changes to the petroleum regime or simple uncertainty of its application may also bring added risk for exploration and development. Obviously, all governments wish to optimise the value that they can garner from petroleum resource development; after all it is their resource – to be used for the benefit of all in the Nation. Striking the best terms with the oil and gas companies, whilst enabling those same companies to make a reasonable return on their investments, is often a delicate balance. Sometimes, that balance cannot be achieved, and therefore exploration is thwarted or development of the discovered petroleum resources cannot be pursued. Proposed projects cannot proceed if there is imbalance between the company and government requirements; both parties need to win.  However, all decisions for development are predicated on awkward and uncertain assumptions about the future business of petroleum production.   Production Risks    Production profiles may be defined based on rigorous assessment of the amount of oil and gas that may be recovered from an accumulation.  Well tests are performed to gauge how reservoirs will behave and how much oil and gas a given well can produce. Test results are aggregated and a field development plan with a production profile is prepared based on tapping the oil and gas accumulation with a specific number of development wells. If enough appraisal drilling and sound geological assessment has been made of the reservoir and the physical parameters of the accumulation, a prediction may be made of the extent of recovery of the oil and gas from the accumulation.  Alas, only a fraction of the oil and gas originally-in-place can be recovered. Recovery factors vary from field to field and the nature of the oil and gas and the manner of how the field will deplete over time.  Sometimes, fields perform better during production, and sometimes they fail to live up to expectations.  The potential outcomes have to be risk-managed. Whilst petroleum engineers and geologists may attempt to limit such risk, it always exists. One only knows exactly how much oil and gas one can get out of a given oil and gas field on the last day of economic production when the value of the oil and gas which that field produces fails to covers the ongoing costs of its extraction. However, these risks pale into insignificance if one cannot get oil and gas production to market as result of exogenous risk, such as the closure of vital shipping lanes, like the Strait of Molucca between Indonesia and Malaysia, or the Strait of Hormuz between Iran and the United Arab Emirates and Oman through which 20% of the world’s global oil supply moves.  Figure 15: Whilst many production risks may be managed, exogenous risks such as the closure of major shipping routes may cut off petroleum producers from their markets, after freeworldmaps.net.  Price Risks    The economic outcome of production is determined by the volume of oil and gas produced by its sale price per unit of production. That depends on the quality of the oil and gas and the global market price for oil and gas of that quality. Gas is normally sold with reference to the crude oil price.  Importantly, that sales price for the oil and gas is only after it has been has been appropriately processed into saleable and transportable streams.  The oil has to be separated from water, sediment, and gaseous components, and likewise the gas has to be conditioned to specifications by the removal of water, noxious impurities like carbon, nitrogen and sulphur oxides, and natural gas liquids which can be sold separately. This all costs money to enable the produced oil and gas to be transported safely by pipelines and ships, and delivered to customers for downstream processing and supply. ,   The price of oil is, as we commonly know, subject to much fluctuation depending on global markets which are affected by many factors. Fundamentals such as global supply and demand predominate often highly influenced by politics and international relations, and nowadays, to a smaller degree, by energy transition policies. In so far as oil and gas revenues are thus variable, the projected income of any given oil and gas project is consequently variable. In embarking on an oil and gas development project, the investing oil and gas companies have to accommodate the risk of falling commodity prices and hence revenues, just as much as they have to consider the opposite with higher commodity prices. A development project has to weather the vagaries of the oil and gas prices as they occur.  Equally, as most oil and gas projects extend for decades, they have to countenance changing economic conditions, such as inflation and the cost of money as represented by the discount rate. Figure 16: Crude oil prices 1976 to 2026 with volatility somewhat suppressed due to use of a logarithmic price scale, after CrudeFacts. These extraneous matters often swamp the potential and forecast technical outcomes. Oil and gas price behaviour and the value of money throughout the life of a petroleum development project are key factors for both the investing company and the host Government alike.  No matter what petroleum arrangements and regime are used there needs to be an agreed understanding of the effect of swings in price and the value of money, lest either party is unduly penalised during the project life.  Most often the petroleum regime, one way or another, has a built-in ability to adjust the sharing of the net value of oil and gas production after the costs of exploration, development and production. For instance, income tax is only charged on net income or profit, so if oil and gas prices decline, profits decline and taxation accordingly also declines. In production sharing arrangements, the sharing of production comes only after the companies receive cost recovery payments, so a company’s share is reduced (as is the Government’s share) when prices are low. There can be elaborate fiscal adjustments made both for the upside and downside of production operations. Royalty and such direct levies can be made scalable. Capital depreciations for allowances against taxation income can also be adjusted, both up and down. Windfall taxes, additional production shares, or additional profits taxes can be triggered at times of elevated prices.  The key is for each party – both company and Government alike to respect the durability of the petroleum project and accommodate the volatility of prices by respecting the needs of the other party.   Other Development Criteria    When preparing a petroleum project for the production of oil and gas from a field, many matters have to be considered. Not only do the fiscal and commercial arrangements with the host government have to be firmly agreed and be robust for all likely outcomes, but environmental protection and the welfare of the community in which the project may be developed are required. There are necessary social and environmental impacts of petroleum development, but they can be minimised and mitigated by good practice.  Whilst exploration and appraisal costs are normally funded out of the company’s own money – its equity, when it comes to development, the extreme costs most often necessitate recourse to the borrowing of funds from financial institutions. Not all banks are willing to finance oil and gas developments these days due to the degradation of the Earth’s atmosphere caused by the emission of carbon dioxide on combustion of oil and gas and the subsequent effect of global warming of the atmosphere by the greenhouse effect.  Alas, many of those banks that withhold their financing are resident in nations in which their industries have been the primary polluters of the atmosphere for decades. Having initiated global warming and developed their economies, they now seek less developed nations to curb their emissions. This seems to be quite unfair. Fortunately, there are financial institutions that are more pragmatic and realise that there is no single big switch in energy supply to curtail all oil and gas production and usage.  Oil and gas will be essential ingredients in the global energy mix for decades to come, unless we wish energy poverty to pervade the planet, and life as we know it to be halted. This is not to support a case against global warming which is a documented scientific fact. We all have to be considerate of the future of our planet and work carefully towards limiting emissions of carbon dioxide and so limiting the extent of global warming through appropriate policies and investment in non-polluting energy of which renewables are just part of the mix alongside improved nuclear technology.   The Final Investment Decision   Once all aspects of a specific petroleum development project have been organised and prepared, the project plans may be presented to the host government for approval. Naturally, being a predominantly interested party, the host government normally readily approves these plans. After all it will be looking forward to its share of the earnings and other benefits from the proposed project.   Once the development licence is granted or a production permit is approved pursuant to a production sharing contract, the company (most often a consortium) has to make its final investment decision which triggers development operations. Various measures are used to determine the acceptability of a project for investment, traditionally the internal rate of return was used. It measures the effective rate of return earned by an investment as though the money had been lent at that rate. Alternatively, and used much more these days, is the net present value of a project which measures the capital created over and above the company’s investment hurdle rate.      Figure 17:  The Decision Rule, after Allen and Seba. This decision is not one made by the host government, but by the investing company, but failure to proceed with development may incur severe penalties once host government approval has been given. Most often the investing company is required to provide the host government with a corporate guarantee of value equivalent to the intended investment as part of its application for development approval.  That way the Government is not misled into approving a fake development where nothing happens, and allowing the company to slip away without repercussions.  When Chevron Niugini led the Kutubu Petroleum Development Project in 1990, Chevron Corporation, its parent company, provided an irrevocable letter of guarantee to the Independent State of Papua New Guinea to the value of its share of the expense in the project on its corporate letterhead signed by the President of Chevron Corporation; it was as good as gold! But they never hesitated in their development intent and resolutely developed the Kutubu fields as professionally as they could.     Michael McWalter is a former Director, Petroleum Division and Adviser to the Government of Papua New Guinea, and erstwhile petroleum adviser to the Governments of Ghana, Liberia, Cambodia, Sao Tome, and South Sudan. He is certified petroleum geologist and technical specialist in upstream petroleum industry regulation, administration, and institutional development.   Caption    

Ok Tedi Mining Limited (Ok Tedi) is joining hands with the community to fight tuberculosis (TB), one of the leading health challenges in Western Province. The initiative follows an awareness campaign carried out by Ok Tedi’s Health Services team at Wangbin Village, a mine village located on the outskirts of the township. The campaign focused on dispelling myths about TB, encouraging early diagnosis, and reinforcing the importance of completing treatment. The awareness program followed the 2026 World TB Day theme, “Yes! We can End TB! Led by Countries, Powered by People,” and aimed to encourage early testing and treatment. Speaking during the awareness program, Ok Tedi Health Services Manager Raymond Singamis highlighted the seriousness of the TB burden in the province. “Western Province is a recognised ‘hotspot’ for TB and multi-drug-resistant TB (MDR-TB), frequently ranking within the top two to three provinces for total TB cases, and the situation in North Fly is particularly concerning,” Singamis said. “North Fly District alone has 1,018 confirmed TB patients, while the remaining districts each have more than 500 cases. These numbers are a clear warning — TB is here, and it affects our families.” Singamis emphasized that access to healthcare should not be a barrier, noting Ok Tedi’s ongoing support. “With Ok Tedi providing free medical checks, diagnosis, and medication, there is no excuse for delayed treatment. If you have been coughing for a long time, feeling weak, losing weight, or experiencing night sweats, go to the hospital immediately. TB spreads silently within households if left untreated," Singamis said. The event also received strong backing from community groups. President of the Women and Children Association, Alice Mumuyong, shared a personal message on the impact of TB on families. “As a mother with a child currently undergoing TB treatment, I have witnessed firsthand the critical role Ok Tedi Health Services plays in our lives,” Mumuyong said. “Their support gives families hope and a real chance at recovery. On behalf of the Women and Children Association, we sincerely acknowledge and appreciate this commitment.” Mumuyong announced that the Women and Children Association has committed its own resources to support TB awareness at the community level. “We have set aside funds to partner with the Ok Tedi Health Services team to take TB awareness directly to our communities. TB is not something to hide or fear — it is something we must confront together.” Mumuyong further urged community members to take responsibility for their health. “I strongly encourage everyone — men, women, and children — to go and get checked. Early testing saves lives and protects your family.” Ok Tedi continues to work closely with stakeholders, community organisations, and health authorities to strengthen TB prevention, detection, and treatment in line with its commitment to improving health outcomes across Western Province. Ok Tedi Mining Limited (OTML) is a majority state-owned entity that operates an open-pit copper, gold, and silver mine located in the Star Mountains of Western Province, Papua New Guinea. The company ships copper concentrate to smelters and ore refineries in Japan, the Philippines, Indonesia, South Korea, India, and Germany. The company has been operating in the region for more than 40 years and has made a significant contribution to development in Western Province through direct and indirect employment, royalties, compensation payments, and business opportunities. Ok Tedi is expanding its operations into Milne Bay Province through the acquisition of Gallipoli Exploration Limited, a wholly owned subsidiary of Australian mining company Kingston Resources Limited, for the Misima mine. The company’s registered office and senior operational management team are located in Tabubil, Western Province, PNG. It also has a representative office in Port Moresby and a marketing and logistics facility in Brisbane, Australia. To learn more about Ok Tedi Mining Limited, visit: www.oktedi.com.

As Papua New Guinea continues to strengthen its economic ties with Australia, Westpac PNG is reaffirming its long-standing commitment to the region as a sponsor of the 41st Australia–Papua New Guinea Business Forum & Trade Expo, to be held in Brisbane from 13–15 May 2026. For more than four decades, the Australia–Papua New Guinea Business Forum has been a cornerstone of bilateral engagement, bringing together senior government officials, business leaders, investors and development partners to foster dialogue, collaboration and investment between the two countries. As part of Westpac’s sponsorship, the bank will once again host the Forum’s official opening dinner, setting the tone for the days ahead and providing an opportunity for meaningful connections between Australian and Papua New Guinean stakeholders. This year’s opening dinner will feature a keynote address by Ben Ikin, a former State of Origin star, premiership-winning NRL player and respected business executive. Drawing on his experience across elite sport and leadership, he will share insights on leadership under pressure, building high-performing teams, resilience, and the importance of trust. “The Australia–Papua New Guinea Business Forum continues to play a critical role in strengthening commercial ties between our two countries,” said Patrick Wright, head of corporate and commercial banking at Westpac PNG. “As a long-standing partner to businesses operating across Papua New Guinea, we see firsthand the importance of trust, leadership and collaboration in driving sustainable growth. Ben Ikin’s keynote will resonate strongly with the Forum audience, bringing practical lessons from high-performance environments that translate directly into business leadership.” The 2026 Forum coincides with NRL Magic Round in Brisbane, creating a unique and high-energy backdrop that reflects Papua New Guinea’s deep cultural connection to rugby league and the enduring links between sport, community and leadership. Westpac remains committed to supporting initiatives that drive sustainable economic development across Papua New Guinea and the Pacific, and to partnering with clients, stakeholders and communities today, tomorrow and for generations to come. Westpac Papua New Guinea has been supporting individuals, businesses and communities for more than a century, having established the country’s first commercial bank in 1910. As one of Papua New Guinea’s leading financial institutions, Westpac PNG provides a broad range of retail, business and institutional banking services, with a strong focus on supporting economic growth, trade and financial inclusion. Westpac PNG is committed to being a trusted and responsible banking partner, delivering sustainable outcomes for its customers while investing in community development, financial literacy and capability-building across the country. As part of the Westpac Group, the bank brings global expertise and regional experience to support Papua New Guinea’s long-term prosperity.