KPPA controversies pile up (short version)


The Konebada Petroleum Park is a government initiative to promote the downstream processing of petroleum products and other energy projects. It has attracted serious criticism:

To these controversies, PNGi can now add further mysterious corporate sales and purchases, links to Hong Kong and China, life-long appointments, possible conflicts of interest and a potential breach of PNG’s strict citizenship laws.

Petroleum Park Holdings Limited (PPHL)

PPHL was registered in 2016, with the Donald Valu, CEO of the Konebada Petroleum Park Authority (KPPA) and Joel Valu (KPPA Managing Director) as the directors and shareholders. In February 2017, Valu was replaced as a director and shareholder by Samuel Pepena.

PPHL appears to operate as a ‘subsidiary’or ‘linked’ company of the KPPA, as was revealed in an earlier PNGi investigation; but on the face of the Investment Promotion Authority records it is a private owned company.

Samuel Pepena

It is not known how Sam Pepena came to be chosen as the Board member and shareholder of PPHL to replace Joel Oli, but he has an interesting past.

That history includes a failed ‘pyramid investment scheme’ in which investors lost millions of dollars. He also worked for a company Global Transfers Limited at a time it was involved in the contentious acquisition of a parcel of land along the Porporena Freeway. Pepena has also been accused, by his estranged wife, of abducting their children and taking them to Fiji.

However, there is no evidence on the public record proving wrongful conduct in relation to either the Global Transfer land matter or the removal of his children to Fiji for a period.

PPHL Hong Kong

Petroleum Parks Holdings Limited is not only a registered company in Papua New Guinea. Another company with the same name, exists in Hong Kong.

PPHL Hong Kong is owned by a Hong Kong resident, Christine Sau Ying Yuen. The directors are Christine S. Y. Yuen, Donald Valu, Sam Pepena, former Minister for Justice and Attorney General, Ano Pala, and private lawyer and businessman, Peter Pena.

Two things about this Board are particularly notable:

  1. Sam Pepena is listed by the Authorities in Hong Kong as a Fijian national holding a Fijian passport number ‘970223’.
  2. Both Mr Pepena and Mr Valu have recently been made ‘Permanent Directors for Life’ by PPHL HK

Pacific Oil and Gas Limited (POGL)

POGL is a company registered in June 2014, with Able (Abel) Wain as the sole owner.

In November 2016, Wain issued 200 new shares in POGL to PPHL and 100 shares to Pertusio Capital Partners Limited.

Six months after receiving its shares in POGL, PPHL sold 80% (160 shares) to Pertusio Advisors Limited (which is owned by Pertusio Capital Partners Limited). The sale price was K5 million, with K500,000 to be paid immediately, a further K1.5 million within 30 days and the balance (plus interest) over the next 10 years.

In August 2017, PPHL transferred its remaining 40 shares in POGL to Pertusio Advisors Limited. The sale price has not been revealed.

Bismarck Oil Company Limited (BOCL)

BOCL was registered as a company in August 2011, by Ralph Saulep with Saulep (8,500 shares) and Francis Wassaw (1,500 shares) as the two owners.

In August 2015, the first board for KPPA was sworn in with Ralph Saulep as Deputy Chairman.

In November 2016, Saulep and Wassaw sold their shares in BOCL to PPHL.

Regional Resources PNG Limited (RRL)

In the same month as the BOCL purchase, Donald Velu and Samuel Pepena were also appointed to the Board of RRL.

According to Investment Promotion Authority records, RRL is owned by Koiti Mel (53%), Peter Pena (40%), and Thomas Dott (7%).

However, PNGi has sighted a set of signed RRL Board Minutes that includes a resolution ‘to transfer 80% of the shares (8,000 out of 10,000 issued shares) and corresponding interest in EL 1611 to Petroleum Parks Holdings Ltd’. Mineral exploration licence EL 1611 covers an area near Mount Hagen.

Peter Pena featured in both the investigations of the Commission of Inquiry into the Department of Finance and the Commission of Inquiry into the National Provident Fund. The former inquiry found he had engaged in “dishonourable, improper and unprofessional behaviour” in assisting MP Andrew Maid with an allegedly unlawful claim and profiting from that exercise.

Peter Pena, remember, also sits on the Board of the Hong Kong registered Petroleum Parks Holdings Limited.


So what are we to make of all of this?

State enterprises were established as a mechanism for ensuring nationals could control a greater share of our country’s wealth, set against a colonial backdrop of foreign domination.

They are also a method, through which the national government can use economies of scale, backed by state power, to strategically foster certain sectors and industries, that generate employment and business opportunities for nationals, set against a global market context, which has always disadvantaged nations of the Global South.

But when state-enterprises fall into the hands of corrupt cabals, they become a mechanism for looting public resources, which only serves to exacerbate inequality and make PNG less competitive internationally.

PNGi alone has pointed to a growing number of worrying examples, where evidence indicates state-enterprises are being used for illicit ends, rather than tackling the ongoing legacies of colonialism, and global disparities in market power. Which is no advertisement though for privatisation – the private sector, as much as the public sector, has demonstrated an addiction to the engorged profits accrued from manipulating markets and dodging regulation.

The Konebada Petroleum Park Authority appears to be one link in a chain of broken state enterprises.

The National Research Institute has already suggested the Konebada Petroleum Park is ‘a State-Sanctioned scam’ and nothing that PNGi has subsequently uncovered suggests otherwise.

To the evidence of unlawful land grabbing and serious financial mismanagement, that dates all the way back to the Park’s first iteration as a private company and seems to be still continuing today, can now be added a series of shady corporate deals that surely demand vigorous and independent inquiry:

  • Who are the beneficial owners of Petroleum Parks Holdings Limited?
  • How did Samuel Pepena become involved in PPHL; who made the decision to involve him and what is his nationality status?
  • What is the relationship between the PNG registered PPHL and the company of the same name registered in Hong Kong?
  • Who are the beneficial owners of the Hong Kong PPHL?
  • What were the circumstances of PPHL becoming a shareholder in Pacific Oil and Gas and the subsequent sale of its interest for K5 million plus?
  • What is the full story around PPHL buying a company, Bismarck Oil, from the Deputy Chair of the Park Authority?
  • What is the relationship between PPHL and Regional Resources PNG Limited and the status of its exploration licence?
  • What are the circumstances surrounding Peter Pena’s role as a shareholder in RRL and director of PPHL HK and how have any potential conflicts been managed?

While there might be serious doubts that government authorities will initiate any sort of inquiry into these issues, we hope that by highlighting them here the international community will be put on notice and that those who have further information will be encouraged to contact us – [email protected].

Complete confidentiality is, of course, assured.