Member for Koroba-Lake Kopiago Philip Undialu has call for a transparent and open dialogue between the landowners and the Kumul Petroleum Holdings Ltd in regards to the proposed Vendor Finance concept.
Undialu said he had protested during a meeting with KPHL executives and landowners during their meet in Sydney in August after the proposal by KPHL.
“My objection was not only as landowner and MP but as Acting Governor of Hela Province at that time.
“I cannot understand why KPHL rushed to the National Executive Council seeking for a Vender Note to raise funding from international financers?
“Why rush without seeking mandate from the Beneficiary Groups including Hela Provincial Government, the other four provincial governments and landowners?
“Whose interest will KPHL represent?” Undialu asked.
Undialu added that he was worried that KPHL might impose a big security risk to the PNG LNG Project if it goes ahead and push the issue down their throat.
“I call on KPHL to come back to the drawing board and present to us their proposal.
“The Beneficiary Groups will collectively decide on the proposal. No need to argue here. No need to point figures.
“Let's open up and discuss all issues. At the end of the day, we stand with the promise by our Prime Minister to give his people a fair deal just like 33% and 17% to Ok Tedi and Panguna mine landowners respectively.
“We don't want to create a media war over this issue. We want a transparent and open dialogue.
“At the present form and shape, I totally reject the KPHL proposed Vendor Financing concept.”
Kumul Petroleum Holdings Limited Managing Director Wapu Sonk earlier blasted he landowner representatives for issuing misleading statements regarding the proposed vendor financing.
He said the statement is completely misleading and doesn’t make sense at all.
Chairman of the landowners in the project areas of PDL 1 (Arua -Hiwa Block), PDL 8 (Block 1642 -Pureni), and PDL 9 (Humiya Block), Raymond Kuai claimed that the proposed Vendor Financing will create a huge debt burden and negligible returns.
However, Sonk said there are motives behind the landowners’ misleading statements.
He said these are people (Landowners) with vested interest with other motives trying to derail what is a very good offer by KPHL.
Vendor Financing basically means KPHL will give the shares to the beneficiaries at no cost and will recoup the payment internally through the LNG revenue.
It is a form of lending in which a company lends money to be used by the borrower to buy the vendor's products or property.
Vendor finance is usually in the form of deferred loans from, or shares subscribed by, the vendor whereby the vendor often takes shares in the borrowing company.