Whistleblower helps force Konebada Petroleum Park Authority closure

The Papua New Guinea government has made the wise decision to completely abolish the Konebada Petroleum Park Authority. This comes after a series of whistleblower revelations, investigations by the National Research Institute and PNGi, and concerns raised by other academics and civil servants about the corruption, mismanagement and dubious business dealings within the organisation.

The government decision was endorsed by the National Executive Council (NEC) in its Special Meeting on the Budget on 17 November 2017.

It is now incumbent upon the Minister for Petroleum and Energy, Dr. Fabian Pok, to ensure the NEC decision is fully implemented and to resist the current lobbying by KPPA senior management to have the Authority re-instated.

But, even when the NEC decision has been put into effect, the Authority’s abolition is not the final chapter in this classic story of State resources being captured and abused by a network of senior civil servants and business people. Ample evidence is available to support investigations by the fraud squad, Internal Revenue Commission and Ombudsman Commission into the serious financial irregularities that potentially point to fraud and tax evasion. Only when those investigations have been completed and any allegations tested through the courts can matters be laid to rest.

The Konebada Petroleum Park initiative began in 2005 and was designed to provide an industrial precinct for the downstream processing of petroleum products and other energy projects. As early as 2010, the Public Accounts Committee exposed a range of irregular transactions and governance weaknesses.

But it was not until 2017 that the Authority became mired in public controversy.

First a National Research Institute report published in early April questioned how the Authority had been granted control over 23,000 hectares of mainly customary land outside Port Moresby.

This NRI report was followed by a more in-depth investigation of the Authority by regular PNGi contributor, Professor Kristian Lasslett.

Lasslett used the public resources and tools available on the PNGi Portal website to expose a range of irregular transactions and governance weaknesses within the KPPA and its connections to foreign businessmen implicated in a number of notable state-corporate scandals.

These reports prompted a series of whistleblower leaks from within the Authority that were sent to a number of regulatory bodies including the Ombudsman Commission and to PNGi.

Those leaks coincided with an inquiry by the Finance Department that led to it trying to take control of the Authority’s finances, something the Authority challenged through the courts. Meanwhile the Department of Lands started its own inquiry into the land deal.

At the same time, PNGi was able to use the leaked information as the basis for further in-depth investigations using the PNGI Portal tools. These investigations led to a series of further reports.

The first exposed the Authority’s extravagant expenditure on hire cars. This was followed by a report exposing mysterious corporate sales and purchases, links to Hong Kong and China, life-long appointments, possible conflicts of interest and potential breach of PNG’s strict citizenship laws.

Finally, PNGi was able to reveal evidence to support a series of serious fraud allegations against the Authorities’ CEO, Donald Valu and draw parallels with an alleged earlier fraud committed by the current Chief Secretary.

All of this adverse publicity, together with the internal efforts of the Department of Finance appear to have taken their toll, and the KPPA should now be consigned to history. But the fraud, tax allegations and other financial irregularities still remain and the appropriate authorities must bring those implicated to justice.