While it hasnt been mentioned PNGs instability must also be a factor.
PNG gas project faces risks
THREE years after work began in earnest building the hardware to extract and pipe gas from the mountains of Papua New Guinea, initiating what is spruiked as a game-changing bonanza for the fragile nation, many local people remain excluded, frustrated and suspicious about the $US16 billion project.
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The PNG LNG (Liquefied Natural Gas) project has already utterly changed their lives, according to an academic investigation.
Despite its bountiful resources - PNG is an island of gold, floating in a sea of oil, surrounded by gas, so the ritual boast goes - in terms of exploitation the result over the years ''has at best been mixed, with few long-term benefits being passed on to the wider population'', the authors write.
The reason PNG has struggled to capitalise on its natural abundance, and in some cases has ''suffered serious environmental and social harm in the wake of resources development'', is due to a mixture of factors, foremost among them failures of governance - ''the absence of good institutions and sound economic policy'' - and the fragility of vulnerable indigenous populations, many of whom struggle with the social fallout of the roller-coaster rush to modernity that comes in the wake of mining and logging operations.
The report argues that the key to the LNG project achieving its potential to deliver benefits to the community - without overwhelming social costs - requires the resources companies, the community and the government to ''accept and discharge wider responsibilities beyond the narrow remit of self-interest.
Given the nation's ongoing political crisis, ''in the immediate short term, the government doesn't have the capacity, it's going to have to be Esso and the churches who need to pick up the slack to some degree.
Read more: http://www.smh.com.au/business/png-gas-project-faces-risks-20120528-1zfb6.html#ixzz1wCzasbfu
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