PNG Government needs a strong team of industry tried people to advise the government on policies, legislation and financial matters concerning LNG matters.
The screw up with IPIC is because politicians got involved in the negotiation with the Arabs with half baked political cronies as consultants. The politicians didn’t even have a first degree to understand the interacts of the transactions they were handling.
LNG is a new and emerging industry and the the world at large has not come up with the laws and standards to govern this industry appropriately like other commodities like gold and crude oil etc. that is why we need a team of highly technical people who know how to handle such level of transaction to manage all the process involved.
I understand there were huge sums of money paid to a Manhattan/NYC based consulting groups to facilitate for the PNG on the IPIC loan but the question is, did we have the aptitude to understand their level of advise and did we follow them? The manner in which the NA government managed the negotiation in total secrecy and the speed in which they push the deal without proper scrutiny was a record and a total insult to the intelligence of silent educated populace of this country. Now see what they have done to us. SHAME!
Who in his or her mind in such negotiation settle to accept all down side risks and not to entitled himself/herself the right to redeem the bonds once they fall due? This is total stupidity and i will consider this deal as the major joke of the century, a major stuff up. So much for the arrogance and ignorance of the these who championed it. They were going to fast to nowhere as it appears now. They should hang their head in shame for where they have placed the nation in and the opportunity costs to our simple people.
We should learn from these mistakes and should employ/engage people with appropriate knowledge and experience to manage and advise the government on these important deals including the SWF. As a CPA and now a political looking in from the outside, we still do not have the dept within the relevant state agencies to manage the process to start up of another LNG project. We must lower our egos and ensure we breach these gaps in order to maximize our gain on the next LNG project, leveraging from the lessons we learn from the first project. Otherwise the vultures in the financial capital markets and multi nationals will screw us up over and over again.