Tuesday, 23 June 2009 4:17 AM

Phase One of the Pacific Petroleum Project to Commence

Press Statement: 22 June - The Pacific Islands Forum Secretariat is calling for Tenders to establish a Project Implementation Unit under Phase One of the Pacific Petroleum Project.

Prioritised by Forum Leaders, the Pacific Petroleum Project aims to bulk procure petroleum products by pooling Forum Island Country resources to improve negotiation for petroleum supply contracts, leverage purchasing power and to minimise transaction costs for procurement. The Project Implementation Unit will undertake a range of tasks to establish the necessary mechanisms allowing participating Forum members to move towards these arrangements.

"Failure to address the vulnerability resulting from poorly secured energy supply, ill conceived commercial arrangements, or inefficient supply chain management does nothing but continue to place pressure on scarce national resources and in particular national budgets," said Forum Secretariat Secretary General, Tuiloma Neroni Slade.

In an effort to mitigate these pressures, Mr Slade explains that Pacific Islands Forum Leaders agreed, through the Pacific Plan adopted at Port Moresby in October 2005, and in discussions since, to undertake a joint negotiation process for the bulk procurement of petroleum to address their shared concerns about energy affordability and security.

"The last 12 months have seen considerable progress in the implementation of this initiative and most notably the broad agreement on the model through which it will be implemented. The launching of Phase One of the Project will continue this momentum," added Mr Slade.

Discussion and negotiation among national petroleum authorities, Council of Regional Organisations of the Pacific (CROP) representatives and sector experts reached agreement on a procurement model to support the implementation of this initiative in October 2008. This work resulted in the development of a Memorandum of Understanding (MOU) outlining the responsibilities of those Forum members who sign up to this initiative under the auspices of the Pacific Petroleum Project.

The MOU and approach undertaken through Phase One of the Project have subsequently received strong support from Forum Economic and Pacific Energy Ministers respectively, both of whom are key Ministerial bodies dealing with the issue of energy.

The MOU has to date been signed by four Forum members with a number of other Forum members indicating that they will maintain their commitments made through both their Leaders and Energy Ministers and sign the MOU over the next few months.

To download Request for Tender documents, please visit the Secretariat's website on the link below.

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