Photo Credit: Twinza Oil Ltd
The landmark Pasca A Project agreement, in which the National Government will walk away with a 55 per cent interest in the first offshore gas project in the Gulf of Papua New Guinea, will see Gulf Province demand a considerably larger share of the profits.
Twinza Oil and the National Government revealed the results of the talks, which include a 2% royalty to landowners through the provincial government (due to the project's off-shore location), a 2% development tax, 2% from net gross production, and a 2% development levy.
“Our position is simple – and that is to take back a greater share of our resources for the province,” Gulf Governor Chris Haiveta said.
He made the statement after the State Negotiating Team, chaired by Petroleum Secretary David Manau, and Twinza Oil reached an agreement.
According to Haiveta, the National Government will gain greatly from the finished negotiations.
“How we share the benefits will be discussed at the development forum but for headline items, this (deal) ensures the State a bigger stake of 55 per cent, which is more than the 51 per cent stake in the Papua LNG project,” he said.
According to Haiveta, the previous administration set the production levy at 2%, but Prime Minister James Marape increased it to 5%.
In terms of royalties, he added that under the new rate, the provincial government will receive greater advantages — unlike previous agreements for other project regions.
The province administration, according to Haiveta, supports the Prime Minister and Twinza's national content strategy, in which landowners will be awarded food supply, security, and transportation contracts.
These topics would be considered in the development forum, he added.
“We will also talk about benefit-sharing on the development levy and equity,” Mr Haiveta said.
Reference:
Nicholas, Issac. Post-Courier (14 July 2021). “Gulf To Push For More From Pasca Deal”.
