5-Star Boroko Casino Hotel
In September 2011 the media broke the story on a dispute between landowner companies Petroleum Resources Gobe Ltd (PRG) and Petroleum Resources Moran Ltd, the PNG Government and Korean company CMSS (PNG) Ltd.
CMSS signed a contract with the government and the two landowner companies to finance, build and complete the Port Moresby Casino Hotel at Four Mile.
But three years later the project stopped due to the lack of funding, triggering condemnation from the landowner companies and the then commerce and industry minister Charles Abel (Robby, 2011).
The developer was to contribute K164 million for a 90 percent stake in the project. The State had provided the land and a 10-year tax holiday as a partner in the project.
The Mineral Resources Development Company (MRDC), as the custodian of landowner funds held in trust on behalf of PRG and PRM, engaged an architectural firm to check the integrity of the under-construction building to ascertain how much more should be done to get it completed.
There has been no progress at the project site since the government intervened in 2011. The failure of the project now translates to a loss of K22 million belonging to landowners in the Southern Highlands Province.
The loss of a return on investment raises questions as to whether the MRDC subjected the project (including the developer) to an exhaustive due diligence process before committing the landowners.
Now that the project has come to a halt will the Department of Trade and Industry and the MRDC take legal action to ensure the landowners are compensated for breach of contract and loss of income?
