MRDC Responds to Kua on Pasca Agreement

We acknowledge the recent comments made by former Minister for Petroleum, Hon. Kerenga Kua, regarding the MRDC-Twinza deal.

While these remarks are not unexpected, they contain inaccuracies and misleading allegations that need to be corrected.

Notably, it is ironic that his tenure significantly contributed to the nearly three-year delay of the Pasca project, despite Twinza’s consistent efforts to engage constructively.

Under the leadership of Minister Jimmy Maladina, the Department of Petroleum has seen a renewed focus and priority in advancing the Pasca project, demonstrating the Government’s commitment to its progress.

It is important to highlight that former Minister Kua chose to withhold progress on the license for reasons known only to himself.

Furthermore, he was fully aware of the MRDC Group’s intention to acquire an interest in the Pasca A Project, with negotiations commencing during his term as the responsible minister.

These facts underscore the inconsistencies in former Minister Kua’s statement and highlight the need for transparency and accuracy when discussing matters of such significant national interest.

The key points about the MRDC-Twinza deal include:

  1. MRDC does not bear any financial risk (no payments required) until a Gas Agreement is established.
  1. MRDC has conducted two independent valuations by two international reputable firms, both confirming the project’s quality, feasibility, and profitability.

Hon. Kua was the longest-serving minister, yet he neglected to implement policy and legislative reforms aimed at enhancing and reshaping the landscape of landowners’ and provincial governments direct and indirect equity participation.

The Twinza acquisition (50%) by the group on commercial terms signifies a shift from the existing status quo.

The Gulf Province stands to benefit immensely from its significant role in the Pasca Project.

The Gulf Provincial Government has secured a 10% carried interest in Heheve Ltd, the company that is participating in the Joint Venture.

The Gulf Provincial Government and its beneficiaries also holds indirect interests through its involvement with Petroleum Resources Kutubu (PRK) Gas Resource Pipeline Limited, and Petroleum Resources Gobe (PRG) all shareholders of Heheve.

The additional benefits Gulf Provincial Government will derive include royalties and development levies. These benefits will pave the way for sustained economic development within the province.

We extend our gratitude to Minister Maladina for his understanding of the fundamental commercial principles governing the extractive industry, and his decisive action in instructing the negotiation of the Pasca Gas Agreement (PGA) with State Negotiating Team (SNT) to commence swiftly.

This would pave the way for the project to reach Final Investment Decision (FID) and commence construction, potentially coming into production even before Papua LNG.

Pasca will more than double PNG’s current oil production, commercialize surrounding stranded offshore gas fields like Pandora, and trigger more oil and gas exploration which has stagnated in the last 10 years.

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