HMPNGS Basilisk - Lancron Naval Base

HMPNGS Basilisk is the PNGDF Landing Craft Base in Port Moresby harbor. The Commanding Officer of HMPNGS Basilisk is responsible to ensuring that the Landing Crafts of the PNGDF are maintained in accordance with laid down procedures and are in all respects ready to meet programmed operational commitments (‘in all respect ready for sea’). This includes training.

The roles of the Landing craft base are:

• To ensure that the landing crafts of the PNGDF and allocated support craft are in all respect ready to meet their operational commitments.
• To provide port facilities for PNGDF ships and as required, for warships and military vessels of other nations visiting Port Moresby.
• To provide slipway facilities for small craft of the PNGDF and, if and when available, for vessels belonging to other PNG Government Departments and Agencies.
• To provide on the spot replacement of LCH crewmen and their periodic relief in conjunction with HQPNGDF.
• To provide technical and administrative support for LCHs up to and including main relief standards.
• To carry out Intermediate Dockings for Patrol Boats and maintain a technical support capability for Patrol Boats operating in the Port Moresby Area, particularly to the supply of “fast moving” technical stores and spare gear.
• To conduct trade repair activities for all items of maritime spare gear in accordance with current HQ PNGDF directives.

In 2012 the Papua New Guinean Government passed a resolution to relocate the defence force base out of the city. Prime Minister Peter O’Neill said 26 October 2012 that the Defence Force headquarters at the Murray Barracks and the Lancron Naval Base at Fairfax Harbour would be moved away from their current locations to Bootless Bay on the eastern fringes of the city. It will cost about K200 million to relocate the barracks and naval base, the prime minister said. Money for the relocation would be earned from sub-dividing and auctioning the Murray Barracks land.

The current Lancron Naval Base at Fairfax Harbour is hemmed in by commercial development so the base will be shifted. The current base would be sold to PNG Ports. Design work for the relocation was already under way, O’Neill said. Further details of the relocation were being kept under wraps for the moment.

Part of the money generated from the sale of the prime land at Murray Barracks and Lancron would be ploughed back into reviving, revitalising and re-fleeting the land, air and sea elements of the PNGDF. The force would be expanded and used for civic duties such as providing security in all major roads and bridges construction work to protect them against the constant disruptions to such works by landowner claims and crime. They would be fully armed and deployed to ensure there were no disruptions to major national works undertaken throughout the country, O’Neill said.

Moving Murray Barracks would see a major facelift for the capital city and see major capital and construction work in the city. Moving Murray Barracks and Lancron would make available for commercial development many hectares of prime land in the center of the city.

On September 22, 2015 Kumul Consolidated Holdings and the PNG Defence Force signed a Memorandum of Understanding (MoU) to work together in the relocation of the HMPNGS Basilisk maritime base located on the foreshore of Port Moresby. The move woulf prepare the way for the redevelopment of the foreshore of Port Moresby.

Garry Hersey, Managing Director of Kumul Consolidated Holdings said: “This MoU follows the acquisition of Motukea by PNG Ports. It is an essential part of the redevelopment of the waterfront of Port Moresby and is part of a project that we are working on that will showcase Port Moresby and Papua New Guinea to the rest of the world. The relocation of the PNG defence Force to another site will allow the consolidation of several Defence Force sites and provide an essential berthing, refuelling, housing and administration complex away from the city. This is a very exciting time for both Kumul Consolidated Holdings and PNG Defence Force. The purchase of the navy site by Kumul Consolidated Holdings will allow the Lakatoi City Project to be maximised along the foreshore. In time it will provide residents and visitors recreational areas, entertainment precincts, apartments, hotels, cafes and restaurants.”

In January 2017 Kumul Consolidated Holdings issued a Request for Proposal for a Port Precinct Redevelopment Investment and Development Partner. Kumul Consolidated Holdings (KCH) is looking to re-develop inner city waterfront land in Port Moresby, Papua New Guinea (PNG) which is presently used for commercial shipping situated along Stanley Esplanade and Champion Parade from Main Wharf to Lancron Naval Base. KCH’s vision was to transform this industrial area into a vibrant part of the city where economic, social and cultural pursuits flourish and combine to showcase the nation’s capital.

As such, KCH sought to identify a suitable qualified, experienced and financially capable investment and development partner interested in jointly developing the port precinct. The likely private sector partner will be responsible for the delivery of a fully-funded development project through a Public Private Partnership arrangement such as Build, Operate and Transfer model or similar. The closing date for the tender was 3pm on Friday 27th January 2017.

On 02 February 2017 Papua New Guinea's Prime Minister Peter O'Neill ordered an investigation into allegations two of his senior ministers profited from a fraudulent land deal that will see the relocation of the naval base 10 kilometers inland. O'Neill froze an account connected to the deal and ordered Chief Secretary Issac Lupari and Police Commissioner Gari Baki to investigate the matter. The Prime Minister told Parliament he needed "full information" on the transactions before making any decisions, the Post-Courier newspaper reported.

Opposition MP Ben Micah alleged that state-owned company Kumul Consolidated Holdings paid 46.6 million Kina [US$14.4 million] to a company associated with Public Enterprises Minister William Duma in a deal to acquire the land. He has alleged Mr Duma and Defence Minister Fabian Pok purchased land they knew would be acquired in the multi-million-dollar deal in 2014. "The land is 10 kilometres inland from the sea ... so how do you build a naval base ten kilometres inland in the bush," Mr Micah said on Radio Australia's Pacific Beat program.

Major General Jerry Singirok, a former commander of Papua New Guinea's defence force, said it was inappropriate for the minister of public enterprise to be involved in the relocation of a naval base 10 kilometres inland, and raised serious questions in relation to the decision itself. "There's nothing wrong with the current naval base, I say this because all the state needed to do was acquire additional land where the existing base is," he said.

On Feb. 3, 2017 PNG Post-Courier reported that ‘Prime Minister Peter O’Neill has promised to give back portions of the controversial land back to the traditional landowners of Kairuku-Hiri in Central Province. … PM O’Neill said he would give back the land just like he had done to the people of Woodlark Island in Milne Bay Province. … He told Parliament yesterday he has talked with Central Province Governor Kila Haoda and have received the landowners’ petition in relation to the land that was acquired for the relocation of Defence Force military facilities of Taurama Barracks and Lancron-HMPNGS Basilisk naval base.’ The Post-Courier also reported that ‘Duma has maintained that there is no fraud involved in the transaction regarding the payment by Kumul Consolidated Holdings (KCH) and the K46.6 million for Lancron Naval Base. ... Mr Kua said the Minister in his personal explanation to Parliament said he had no direct shareholding in the company, which was confirmed by Registrar of Companies, but can he admit or deny whether he had some indirect association with the company, making him a beneficiary.’

On 7 March 2017, the National Executive Council, chaired by the Honourable Peter O’Neill, Prime Minister of Papua New Guinea, appointed the Administrative Inquiry into the transactions relating to the acquisition of land for the relocation of the Papua New Guinea Defence Force land and naval bases, particularly the Murray Barracks, Taurama Barracks and the Lancron Naval Base, all of which had been located in Port Moresby. The establishment of the Administrative Inquiry was necessitated by the general public’s perception and outcry that the sums paid to acquire the parcels of land were exorbitant and the processes adopted were highly irregular.

It is alleged that the Ministries and Departments of Defence and State Enterprise and State Investments colluded with the proprietors of the said portions of land and paid millions of Kina in both compensation and purchase price, and that the proprietors were either associates, relatives and/or friends of persons holding responsible positions within the Ministries of Defence; State Enterprise. Lands and Physical Planning, Kumul Consolidated Holdings Limited, Motor Vehicle Insurance Limited, State Solicitor and the Valuer General.

In relation to the relocation of the Lancron Naval Base the Defence Council noted: “… that the relocation of the Lancron Naval Base, HMPNGS Basilisk has recommended investigation under the same program and may have a bearing on the budget however discussions is ongoing with PNG Ports to provide upfront payment for the sale of the Lancron which can be used to acquire land for the new site.”

Initial analysis revealed that the best option among all the possible sites being suggested is the Arutu Land comprising 226 hectares next to PNG dockyard — Motukea. The basis for the selection of Portion 406 is not clear. Its acquisition does not appear to have been endorsed by the Defence Council, and there is no information to suggest that its acquisition was ever supported by a feasibility study. Further, at Manumanu the Defence already had 2331 hectares available, namely 2023 hectares on Portion 154, 138 hectares on Portion 422, and 170 hectares on Portion 423.

The property had formerly been a grazing property (it had been called Fairfax Cattle Station) and it had apparently been abandoned. The property was mostly cleared land with some regrowth areas and indications of previous improved pastures in selected areas. The property comprised extensive areas of gently sloping to gently undulating, fully cleared grazing paddocks with reasonable natural grasses. The soils were of moderate to low fertility and this, combined with the low rainfall, lack of permanent water and lack of water storage facilities restricted the carrying capacity

Portion 406 was well away from the sea. The land at Manu Manu acquired by the Defence Department for the new naval base had no direct access to water, and reaching it requires intricate navigation in a river system. It had not been possible to examine the chain of title for Portion 406 because the file in the Lands Department cannot be found. It was one of the files that has “disappeared”. The PNGDF did not own the Lancron Naval Base and had no right to sell it. The land was owned by the State and was reserved for the purpose of public defence. The PNGDF only had rights of occupation.

An examination of the State Lease reveals that the unimproved value of Portion 406 as at 30 July 2015 was said to be K84,420. The area comprised 847.25 hectares. KEL would accept K55 million as compensation for the State’s acquisition. On 3 November 2015, for the purposes of the compulsory acquisition the Valuer General issued a Certificate of Valuation over Portion 406 valuing the land at K46.6 million. The valuation was prepared by Moses Kila, the Assistant Valuer-General. The Administrative Inquiry considered that the most plausible reason for Mr Kila’s behaviour and valuation was financial inducement. Another possibility would be fear of retribution.

On 5 October 2016 under an instrument entitled “Revocation of Certificate Authorising Occupancy”, the Secretary for the Department of Lands, as delegate for the Minister for Lands, revoked the reservation for the Lancron Naval Base. As a result, the land ceased to be reserved for defence purposes. The Independent Committee found it difficult to understand why the reservation status of Lancron Naval Base was revoked when defence personnel and naval assets were still stationed at the base.

That the allegation or suspicion was nothing short of large scale conspiracy is clear from the content of the allegations. The very fact that senior officers covering a number of departments and State entities were suspended demonstrate that there was an allegation of suspicion of conspiracy including corruption on a large scale. The central allegations were that the compulsory acquisition of Portion 406 was corruptly contrived, and that a high valuation was corruptly obtained, thereby enabling a corrupt party or parties to receive the high amount of compensation assessed in respect of the value of the land. The contriving included the prior obtaining of the grant of the land, which may never have been intended to be used for agricultural purposes, but, rather, was intended to be available to be compulsorily acquired at the instance of the Department of Defence.

In the limited investigation it was able to make, the Administrative Inquiry saw no direct evidence, and insufficient circumstantial evidence, to show that the departmental heads were party to a conspiracy to defraud the Government. In short, on the material presently available, there would be no prospect of any conspiracy allegation being sustained against any of them either. All that is not to say that there was no large conspiracy. The prospect that there was such a conspiracy cannot be excluded. All that is being said is that the Administrative Inquiry did not see sufficient evidence to support the expressed allegation that the departmental heads were party to a conspiratorial agreement.

The Administrative Inquiry certainly did not intend to suggest that a considerable amount of manipulation and dishonesty was not involved. There are features of the transactions that make it obvious that manipulation and dishonesty were definitely involved. The fact that the valuation was so far in excess of the true value suggests that the valuation was fraudulently high. The fact that the Lands Department files disappeared strongly supports the proposition that there was corruption involved. There is circumstantial evidence which supports the notion that there was a wide- ranging conspiracy, such as the lengths some personnel in the Lands Department have gone to in removing all the files containing evidence relating to the transactions.