Papua New Guinea PM resigns, throwing gas deal into doubt

Papua New Guinea’s embattled prime minister stepped down yesterday, capping a months-long political crisis and calling a multi-billion-dollar French and US-backed gas deal into question.

Facing a string of cabinet resignations and a vote of no confidence he looked sure to lose, veteran leader Peter O’Neill told parliament he had handed his letter of resignation to the country’s governor general.

“I hereby tender my resignation as Prime Minister of the independent state of Papua New Guinea, effective immediately” read the letter that was obtained by AFP.

O’Neill said he had decided to step down “in the interests of ongoing political stability in our country” citing the need for “economic confidence and social unity.”

For eight years O’Neill had led the rugged and ethnically diverse nation, which is home to over 800 languages.

But he had been heavily criticised for endemic corruption and chronic underdevelopment, in a country that has increasingly become a venue for US-China rivalry.

The government’s purchase last year of 40 Maseratis to ferry foreign dignitaries around Port Moresby’s few fully paved roads during an APEC summit became emblematic of his tenure.

But the breaking point appeared to have been a recent $13 billion deal with Total and ExxonMobil to extract, pipe and ship liquefied natural gas (LNG) overseas.

The deal angered powerful regional and tribal leaders, who suggested they were not getting a fair share.

Finance minister James Marape -- from the Hela province in the highlands -- was the first to resign in protest, saying the money would not go to ordinary Papua New Guineans, local firms or the regions.