Is Konebada Petroleum Park Authority a scam? More questions than answers

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Is Konebada Petroleum Park Authority a scam? More questions than answers

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By Logea Nao, Belden Endekra and Lucy Hamago

The release of our article, Is Konebada Petroleum Park Authority a scam? Is National Gazette No. G76/2017 another Government-sanctioned scam? has generated much discussion both in the mainstream and social media, within and out of the country.

Affected customary landowners from Motu and Koitabu villages within the declared zone of Konebada Petroleum Park (Gazette No. G76/2017) have come out expressing their concerns about the declaration and its implications. The most notable response was a Press Statement from the Minister for Lands and Physical Planning, which was published in the Post Courier of 13 April 2017 (page 53) and 18 April 2017 (page 44). We do appreciate this response from the Minister.

Unfortunately, it is our firm view that the Press Statement has avoided the fundamental issues raised in our original article. We have written this follow-up article in order to seek clear answers to the issues that were raised in the original article and their implications.

The Press Statement that was released by the Minister in response to the original article appears to be a whitewash. The implications of declaring the land area as an economic zone and parking it under a questionable organization are significant.

The majority of land is under customary tenure with thousands of people calling the villages therein their home and businesses worth hundreds of millions of Kina. This makes the actions of the Office of the Minister for Lands and Physical Planning (OMLPP) in regards to Konebada Petroleum Park Authority (KPPA) controversial and questionable. On this note, we raise several questions based on the Minister’s response and further research we have undertaken.

Questions for the Minister

1: Is the declaration of the new boundary technically defective? What power did the KPPA have to recommend land allocation to individuals in 2016?

Waypoint 9 is missing from the declared gazette (Gazette No. G76/2017). The declared gazette is also in breach of Section 4 of Konebada Petroleum Park Authority Act (amended) 2009 because by not including Waypoint 9, the boundary includes land currently under the PNG LNG. This is because Section 4 of Konebada Petroleum Park Authority Act (amended) 2009 states that any declaration that includes land within the LNG Project area in the boundary of Konebada Petroleum Park would be deemed void and of no force of effect.

This is a fundamental breach of an important provision in the Act. It could be easily construed as the work of scammers hastily creating survey plans for gazettal purposes. This reaffirms our position that State instruments such as gazettes are being used to legitimise scams. It also undermines the security of tenure for the PNG LNG site. In addition, we are also aware of decisions in 2016 by the Land Board in allocating land to individuals under the recommendations of (KPPA).

2: Why has the KPPA, which has a history of poor financial accountability as per the Public Accounts Committee (PAC) Report of 2010, been given more taxpayers money to spend under the guise of a special economic zone? How can KPPA use KPPA Limited to develop the special economic zone?

Over the years, the KPPA has been given funding by the State to develop Portion 578 as a township with relevant infrastructure and services. However, no such infrastructure and services exist. This question was raised in the previous article, but was not responded to in the Minister’s Press Statement. In addition, the company incorporated to progress the creation of the petroleum park, KPPA Limited, made its last company returns in 2008, and returns have not been made since then. This technically implies that KPPA Limited is a non-functioning company.

3: How will the Authority meet the requirements of an economic zone, such as physical infrastructure investments and other administrative services for over 23,000 hectares?

KPPA has not managed to develop a 200 hectare portion of land, Portion 578, which is the initial Konebada Petroleum Park. Despite this, it has been given powers over a much bigger area of 23,000 hectares.

Increasing the size of the land available to KPPA to develop a special economic zone will only complicate the existing problems related to accessing customary land for development. The credibility of the KPPA is highly questionable and yet large tracts of land have been entrusted into the custody of this authority. Once again, due diligence has not been exercised.

4: Have the interests of customary landowners within the declared land been taken into account? Who was consulted? When? Have any impact assessments of this declaration on the communities been done? What arrangements have been put in place for their meaningful engagement/involvement?

It is all very well to say that landowners will benefit from this arrangement. However, in the absence of a structured process for their engagement, they might not benefit. This is another pie-in-the-sky, feel-good political statement. The implications of the declaration have not been carefully considered. Without the supporting structure, the declaration can be simply a conduit for land grabbing.

5: Have the business owners that are already operating in the new declared boundary been consulted? What advice have they been given? What are the plans to incorporate their interests in the development of the economic zone?

The failure to consider the interests of existing businesses in the declared boundary is an indication of ignorance in following the proper process. This action must be justified to the businesses concerned and the wider public.

6: Who will oversee development of the customary land in the declared boundary? How will customary land be converted? Who will approve the town plan? Who will approve the buildings and related physical structures?

KPPA is not equipped nor does Central Province have a Land Board or Physical Planning Board to take charge of the land planning and developments. Besides this, some of the land declared is within the boundary of the National Capital District. This provides an administrative nightmare providing an avenue for the repeat of Taurama and 8/9 mile developments.


There are more questions that can be and will be asked in addition to those above. The declaration of the land was a mistake because the adverse implications are huge. More importantly, the KPPA is a questionable organization and should not be mandated the responsibility to provide oversight to the development of the 23,000 hectares of prime real estate land, much of which belongs to customary landowners.

In any case, the declaration is null and void because it is in breach of Section 4 of the KPPA Act (amended) 2009. It will be morally wrong, if after all these questions have been raised, a corrigendum is not done to rectify the defects. The KPPA should not be the driver of development over the economic zone. The onus is on the Central Provincial Government to establish its own Physical Planning Board and Land Board and drive development on this prime real estate land for the people of Motu Koita and Central Province more broadly.


Logea Nao and Belden Endekra are Research Fellows in the Property Sector Development Program at the PNG National Research Institute.  Lucy Hamago is a Research Project Officer in the Property Sector Development Program.


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