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Mediation conducted for Oil Palm Project


Press Release from Catholic Archdiocese of Rabaul


From March 26th to 27th 2018, a mediation was conducted at Kokopo to address issues relating to the Sigite Mukus oil palm project in West Pomio.


The External Accredited Mediator, Craig Jones, conducted the mediation.


According to a statement from the Catholic Archdiocese of Rabaul, this project is being undertaken by Gilford Ltd, a wholly owned subsidiary of Rimbunan Hijau. The project area covers a large area of 55,400 hectares, broken into four blocks which are owned by four respective Local land owner companies (LCO) as follows:


  • Pomata Investments Ltd; (15,000 hectares)

  • Ralopal Investments Ltd; (11,300 hectares)

  • Nakiura Investments Ltd; (16,100 hectares)

  • Unung-Sigite Investments Ltd. (13,000 hectares)


Archbishop Francesco Panfilo, in the statement, said that the project area is mostly forested and that logging has been undertaken pursuant to Forest Clearing Authorities (FCA’s).


“There has however been a number of issues in relation to the Project which has caused considerable tension within the communities in the project area and between the Land Owners and the Developer (Gilford Limited),” the Archbishop stated.


“This eventually led to legal proceedings being instigated by the Land Owners in November 2016 and, as a result, mediation of the Issues was directed by the National Court.”


The Archbishop further stated that since no development had commenced in Unung-Sigite, it was agreed that the current agreement be rescinded and a new agreement be negotiated with Unung-Sigite placing a development proposal to Gilford Ltd by 31st May 2018. The significant point here is that, it is the Land owner company that is taking the lead with regards to the development proposals.


With the three other Landowner Companies of Pomata Investments Ltd, Ralopal

Investments Ltd, Nakiura Investments Ltd, the Developer, Gilford Limited, has made a

commitment to renegotiate the current project development agreement and Sub-lease

Agreement in 2020.


To prepare for this, the Landowner Companies acknowledge that they need to address

Governance issues in the companies, such as fair and proper representation of the clans

within the project areas, either through Registration and Shareholding of different

Incorporated Landowner Groups (ILGs).


Issues of management structure and practice, transparency and the like also need to be addressed to ensure that the landowner companies can be ready for the renegotiation in 2020.


It was agreed at the mediation that the negotiations for the new project development

agreement and sub-lease agreements will address the following issues:


  • Benefits–rental, royalty, contribution to infrastructure and community development;

  • Operation of the project;

  • Scope;

  • Conduct of the parties to the Agreements;

  • Communications;

  • Social and economic impact of the project and how to manage it in a beneficial manner for all parties;

  • Environmental issues


While the Agreement is being renegotiated in 2020, Gilford will consider Landowner

Proposals before then.


“All of this process will be overseen by the Court appointed Mediator, Craig Jones,” said the Archbishop.


“This mediated arrangement opens the door to effectively address all of the issues, concerns, and tensions that relate to the project. It allows both parties to negotiate on equal terms and enables the Land owners to take the lead in proposing the Terms and Conditions of the new Agreements based on equity, justice, sustainability and with an emphasis on the need for environment awareness and protection.”


“The work ahead is immense and difficulties are anticipated, but it is encouraging that both

parties have agreed to move forward and work cooperatively, respectfully and in good faith.”


“The Archdiocese of Rabaul, faithful to the Gospel of Jesus Christ and in accordance with the Social Teaching of the Church, especially with Laudato Si’ of Pope Francis, responded to the cries of the West Pomio people and initiated this Process and is committed to see this

through to conclusion.”

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