Analysis: PNG's Ok Tedi takeover | Pacific Beat

Analysis: PNG's Ok Tedi takeover

Analysis: PNG's Ok Tedi takeover

Updated 19 September 2013, 17:19 AEST

In giving itself ownership of the Ok Tedi mine and repealing former operator BHP Billiton's immunity from prosecution, has the PNG Government left itself open for prosecution?Long time commentator on PNG politics and issues, Martyn Namorong, believes it has.

Presenter: Campbell Cooney

Speaker: Martyn Namorong, PNG political commentator - worked for Ok Tedi, doing community research in 2012

NAMORONG: At that time last year the government was moving to take Ok Tedi and there was pretty much a feeling amongst many employees and those of us who are contracted to Ok Tedi that the government had the power to do a lot of things in the land, and essentially everyone sort of expected this to happen, although many would have tried to avoid it.

COONEY: It happened very quickly, it happened very suddenly, it was raced through parliament last night, and I'm curious if you've heard from others around the country and from the province and from everywhere about the way that this was done and the feeling about it?

NAMORONG: General within Western Province there's a mixed response. There have been those who in the province who have not been satisfied with the way PNGSDP has operated, and in fact there are some in quarters who supported the government on this issue. Not everyone agrees with that, for some people there's the concern that monies that have been kept in the long-term funds for the benefit of the future generation of Western Province, and now they're exposed to political manipulation. But the governance is concerned about the long-term fund which was intended to benefit future generations of the people of Western Province. I mean if you think about the Fly River environmental disaster, it's something that's going to take several centuries to be resolved, and so one has to think long-term post-9 closure when talking about how benefits of Ok Tedi are delivered to the people of Western Province.

COONEY: The PNGSDP had been previewed by the Prime Minister in the days ahead of it, but I don't think many people expected the removal of indemnity for BHP. How has that gone over and you mentioned as well that it's probably in many ways also leaves the government open to prosecution?

NAMORONG: Essentially yes because PNGSDP was setup to indemnify both BHP and the state on matters regarding Ok Tedi. Now obviously the polluting party in the case of the Fly River is the Ok Tedi Mining Ltd, the company, the company's shareholder now is the independent state of Papua New Guinea. And so since the state has removed the indemnity clause which indemnified Ok Tedi Mining Ltd and its shareholders, its shareholder which is the Papua New Guinea state is now exposed to litigation. Now I suppose there was a clever lawyer with regards to this matter, because if in the case of the removal of the clause allows people to take litigation, so if say for example BHP continues to claim Ok Tedi it exposes them to litigation, and one would like to generally speaking want to cut losses in relation to the matter. And so it also would devalue Ok Tedi, which is a tribula(?) kina company, it would devalue the value of that company by exposing it to litigation. And so in the event that anyone wants to acquire the company they would acquire it for essentially very little. So that's the broader implication of the removal of the indemnity clause, basically to devalue Ok Tedi, so it can be acquired for less.

COONEY: You mentioned that you've heard from a few landowners who were pretty pleased to hear about this. Are you expecting to see a slew of cases, a slew of compensation cases?

NAMORONG: I think yes people who have been excluded from what is referred to as the community mine continuation agreement, they're people around the periphery of the Fly River who feel that the broader impact of the environmental damage goes beyond what is currently referred as the ?? region, and would like to claim compensation. They had no legal avenues to do so, and now they're presented with the opportunity to take the major shareholder or the sole shareholder of Ok Tedi Mining to court for claims of compensation.

COONEY: Just on the politics of this Martyn Namorong, in previous times you've had certainly coalition governments in power in PNG, there's been a lot of negotiation to get through. Peter O'Neill seems to have been able to get this through with little trouble. The politics of it would indicate that for the first time he's been able to garner support for this, is it because it's the right policy or is it just another sign of just how much support he's got there?

NAMORONG: Broadly speaking the O'Neill government has made very populist policies, they have free education, universal primary healthcare, these are key social issues that the government has been very positive in the country, so there's been if you like support for the government on those matters. There is a very nationalistic tone within the government on not just the resource sector, but the impacts of business, business ownership, small and medium enterprises. So there is this if you like greater nationalistic approach or tone within Cabinet and the broader O'Neill government. So there is if you like an alignment of interest amongst various parties and the nationalisation of Ok Tedi is part of that emergence of nationalistic fervour amongst Papua New Guinea politicians.

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