Papua New Guinea is rich in natural resources including large gas fields. File photo/ AFP
Papua New Guinea’s finance minister resigned on Thursday, days after the country signed a multi-billion dollar gas contract with energy majors Total and ExxonMobil.
James Marape, who also leads the government in parliament, resigned citing the failure of the government to ensure national firms and locals benefit from the contract.
On Tuesday Prime Minister Peter O’Neill announced the $13 billion project that includes the extraction, pipelines and an upgraded LNG facility to ship the gas overseas.
The leading companies involved are France’s Total, US firm ExxonMobil and Oil Search, a firm partially owned by the Papua New Guinea government.
“This decision is not easy to make,” Marape said in a statement obtained by AFP, adding that trust between him and the prime minister was at its “lowest.”
“Whilst we don’t have any personal differences, we do differ on some work and policy related matters,” he said, citing the need for more local “participation in our gas, oil sector” and mining industry.
Marape’s departure could prompt further cabinet resignations that are problematic for the government and may spur local protests against the gas projects.
He represents a district in Hela Province that an oil pipeline traverses.
The project would almost double Papua New Guinea’s gas exports, but local communities have complained bitterly about not getting benefit from similar deals in the past.
One of Asia’s most impoverished nations, Papua New Guinea is rich in natural resources including large gas fields.
Papua New Guinea Prime Minister Peter O’Neill stalled his announced resignation and took legal action to prevent a vote of no confidence on Tuesday, deepening the country’s political crisis.
Australian firm Oil Search on Tuesday accused Papua New Guinea of backtracking on a deal to build a new liquefied natural gas project and set an August 31 deadline to resolve the dispute.
Papua New Guinea’s petroleum minister on Friday flagged a standoff in talks with Exxon Mobil Corp tied to a $13 billion gas expansion, saying the US oil giant was unwilling to negotiate on the country’s terms.
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