Benefits to flow as Moran signs deal

Immediate economic benefits in the form of business contracts are likely to flow to landowners of the Moran Oil project, following the signing of a milestone agreement at the end of October.

Huli-speaking landowners from the areas surrounding Homa, Paua and Baguala villages have formed an umbrella company to derive further business development from the Moran project, and Chevron has immediately awarded them their first major contract.

The Moran Development Corporation has entered into a K 15.4 million contract to build Stage Two of the Homa to Paua tax credit road.

The road, with five bridges and other associated works, will run from the shores of Lake Kutubu up into the Huli speaking villages leading to Homa, providing the village people with their first road link to the more developed areas of the Southern Highlands Province.

As well as benefiting from use of the new road, landowners will earn income from the contract to build a significant part of it.

The contract is also specifically drafted to nurture the new development corporation. The contract has been structured to minimise the risk in all areas, Chevron’s Operations Manager

Dave Madison said at brief signing ceremony.

To assist the Moran Development Corporation, CNGL has included K 300,000 in the mobilisation payment to allow for the purchase of tools and spare parts.

CNGL has also exempted the corporation from retention, for the first twelve months of the project.

In addition, CNGL will meet the cost of Project Manager and Project Administrator, external to the contract.

This will significantly assist in the reduction of overhead costs, making it easier for Moran Development Corporation to have a positive cash flow early in the contract, Madison said. The target profit for the contract is 12-15%, which Chevron believes can be achieved with good management.

Discipline and prudential business practices are expected in return.

Madison said that Chevron expects directors and shareholders of the new corporation to be committed to working as a team, both on the road project and on the development of Moran Extended Well Test into a full-field project.

Chevron also hopes that the board will put in place measures to ensure that all shareholders get equal benefit from the contract, and are able to gain confidence that the benefit will be

passed on.

Eleven clans, identified as landowners by the Moran project’s land demarcation officers, have come together with encouragement from Southern Highlands Governor Anderson

Agiru.

“The landowners and the Governor deserve congratulations for bringing the Huli clans together in an orderly manner to share in the benefits of Moran,”

Chevron’s manager of government and public affairs, Imbi Tagune, said.

“The Moran project is currently producing oil for Papua New Guinea under the scheme known as Extended

Well Testing. Development plans are

underway to progress Moran into PDLS, that is, as PNG’s fifth full-field oil development.

“Our lands officers have identified eleven clans in the PDL area, and there is provision for the admittance of more, if further examination identifies more clans with entitlement.

“In the meantime, the Huli villages have shown foresight in getting this development corporation together, and earning their first contract.

We are glad that they share our view, that this is the way to move forward together,” Tagune said. (Post Courier) ■