In an escalation of the public debate over the ownership of the Ok Tedi mine, the Chairman of the Papua New Guinea Sustainable Development Program Ltd (PNGSDP) has accused the government of ‘stealing’ Ok Tedi Mining Ltd.

PNGSDP Chairman, Sir Mekere Morauta

Earlier this year, Prime Minister Peter O’Neill announced his government would legislate to sever the connection between PNGSDP and OK Tedi Mining Limited (OTML), operator of PNG’s largest mine. (PNGSDP is currently the 63.4% majority owner of OTML, with the State of PNG owning the remaining share.)

However, Sir Mekere said he was ‘shocked’ by the Prime Minister’s suggestion on PNG’s national television network EMTV last Sunday that his government would expropriate Ok Tedi without compensation.

‘We are not going to pay for anything that we already own,’ O’Neill said during an interview.

In a statement, Sir Mekere said this was ‘nothing more than stealing an asset belonging the people of Western Province’.

‘Those shares are owned by the people of Western Province, not PNGSDP. PNGSDP is merely the custodians of them.

‘The Prime Minister is legally and morally obliged to pay a full and fair price if he is so determined to get his hands on them.’

Sir Mekere said PNGSDP would do everything in its power to prevent expropriation without compensation, and was ready to take legal action if O’Neill brought this dangerous legislation to Parliament.

‘Stealing an asset worth approximately K2 billion to the people of Western Province, plus their annual K450 million share of the Ok Tedi dividends, is not acceptable legally or morally. It is unconstitutional as well.

‘I also fear that this is just the first step—I hope he does not want to get his hands on PNGSDP itself and the US$1.4 billion in the Long Term Fund.’

But O’Neill has rejected Sir Mekere’s claim, and told reporters legislation to take change the ownership of PNGSDP would be introduced in the current session.

‘The legislation is very simple—what we are doing is taking ownership of the shares (in OTML). We are not taking over the management.

‘We are taking over the ownership of the shares, which is rightfully ours in the first place, anyway. Secondly, we are restructuring the PNGSDP. We don’t want anybody from Melbourne or BHP, to run PNGSDP.’

In a statement earlier, he accused Sir Mekere of being irresponsible and trying to scare people, according to Radio Australia.

The prime minister said the government has agreed to pay fees ‘on the basis of an assessment of sunk costs to facilitate the transfer of the shareholding held by PNGSDP’.

Landowners’ opposition

PNGSDP Chief Executive Officer David Sode has given his support to Community Mine Continuation Agreement (CMCA) leaders, who are opposed to the government’s plan.

Sode pointed out the dangerous precedent being set by the Prime Minister and members of Parliament who vote in favour of such expropriation bills in attempting to exercise improper use of the legislative powers to steal the Western Province’s inheritance.

‘Is he going to get away with this and is it going to be repeated elsewhere?

‘Resource owners throughout PNG should be aware of the precedent being set and stand up for their rights and support the CMCA leaders.’

Radio Australia reports landowners have written to O’Neill warning they will withdraw their consent to extending the life of the mine, if current arrangements are not maintained.