A GROWING MOUNTAIN OF STRANGENESS REGARDING ISRAEL’S LR GROUP ATTEMPT TO TAKE OVER PROVISION OF ELECTRICITY TO PAPUA NEW GUINEANS
By אנשים ישראליים טובים עוזרים לנו לחקור אותך
LR Group, the company that Peter O’Neill and State Enterprises
Minister Ben Micah have already apparently made a deal with to take over PNG
Power, superficially appears like a company without workers. Based in Israel it lists at least one
non-existent address for its office sites and its other supposed offices seem
to be in warehouse like buildings which may house other companies as well. LR Group relies mainly on contract employees,
recruited from around the world on the basis of their CVs. It throws them all together to create
projects in developing countries, many of which seem hopelessly unsustainable
and uncapable of being taken over and run by local people. Developing countries are the ideal location
for these kinds of throw together operations as the level of scrutiny and
quality control is usually low. Once
started, local governments may desperately keep the operations going by
continuing to pay LR Group to run the show.
The article in the following link covers much of this information:
LR Group promotes itself on LinkedIn as having “an unequalled record of success in some of
the world’s largest sustainability projects”. Yet, it only has 503 followers on LinkedIn,
in comparison to a company like the National Petroleum Company of PNG which
hardly anyone even in PNG has heard of (it is the PNG government company which
has 16% interest in the LNG project), which has 660 followers. LR Group tends to publicise large proposed
projects about which nothing can later be found on the internet concerning
their outcome. One example was the
100,000 houses that LR Group announced in 2010 it was going to build in Angola
before 2012. Nothing more was heard of
that project, not even on the LR Group website. What is unusual about this is that most
companies would bend over backwards to show the end products of successful
activities. In LR Group’s case, it seems
to mostly advertise what it wants to do, or plans to do.
The allegation has been made that LR Group has no experience running
a power company. An extensive internet
search reveals not one completed project of any major proportion in the area of
electrical service management. Only a
single proposed project to install power meters in Honduras was revealed:
Only a few months after this announcement was made, the LR Group was
embroiled in corruption charges regarding this project:
with the English translation of the article here:
What the article reports is that the private Honduras consortium Services Electrical Measurement of
Honduras (Semeh) had been performing meter
reading and billing services for the Honduran government’s National Electricity
Company (ENEE). The ENEE union workers
protested against the private Semeh doing what they felt they felt government
ENEE employees should be tasked with. The government responded that when ENEE
workers did the meter reading, there was corruption. The government still made a decision not to
renew the contract with Semeh. Following
that, to everyone’s surprise, ENEE hired LR Group to perform the work, rather
than going through the normal tendering process. The Honduras Prosecutor Against Corruption
stepped in to investigate the case.
Nothing more appears on the internet nor any indication that LR Group
ever got the contract or installed the meters.
Later that year (2012), LR Group was trying to get into position to
make a bid to buy into 50% of Honduras Telecommunications:
Nothing seemed to come of that.
Amother LR Group idea that didn’t bear fruit.
It was also in 2012 that LR Group was in negotiations to take over
Port Moresby’s power. Sir Mekere
Morauta, then Minister for State Enterprises, was heavily involved:
Morauta states the following in that press release: “If current negotiations with LR Group are
successful, LR Group and PNG Power will have a 50-50 management contract to
refurbish, maintain and manage the assets owned by Port Moresby Power Limited.
LR will have a half share in managing the assets, not any form of ownership at
all.”
The above goes against what was stated in a recent article
concerning the strange business deal related to the 2 generators, but I will
leave that to others to puzzle out.
There are many larger discrepancies about the generator purchase that
Peter O’Neill has yet to explain clearly and fully, such as:
-Why K50 million for the generators was wired directly to LR Group
and not to Israel General Electric Corporation or to General Electric USA,
where the generators were manufactured.
-Why the Bank of PNG (not a commercial bank like BSP) facilitated
and effected the K50 million transfer to LR Group?
-Why generators were purchased to solve Port Moresby’s power problem
(only 1 of the 2 generators will be based there), when even LR Group didn’t
recommend generators as a solution to the Moresby power problem when they
prepared a feasibility study earlier.
See: http://www.pngblogs.com/2014/05/lr-groups-plans-to-take-over-png-power.html
-If it was true that members of the PNG
Power Board accompanied the PM to Israel and were involved in negotiating with
Israel General Electric, as noted by the Prime Minister himself, who were these
individuals and why didn’t these discussion become known to other relevant
senior managers of PNG Power back in PNG?
- If it was true that members of the PNG Power
Board accompanied the PM to Israel and were involved in negotiating with Israel
General Electric, why then did the Prime Minister chose LR Group to facilitate discussions between the PNG Government and the Israeli
State-owned company Israeli electric to deal with General Electric Corporation
(also the Prime Minister’s own words)? Why
the 2 layers of middlemen organisations?
Why couldn’t PNG Power complete the negotiations without LR Group’s
help, being that PNG Power personnel were brought to Israel to start those
negotiations?
After the generator scandal began to fade from people’s minds came
this month’s announcement that LR Group was going to construct a substantial
hydro project in Southern Highlands.
Actually this project has been bouncing around for more than a year:
It appears that while LR Group proudly lists one of its areas of
expertise as renewable energy and power, it shows no evidence on its website or
in any internet stories that it has in-house expertise for this kind of
project. As the article whose link is given above
indicates, LR Group had to contract Endura, the consulting arm of Hydro
Tasmania (the company supplying electricity to Tasmanians) to do a feasibility
report for the PNG Hydro scheme as it seems to have no expertise at its own
fingertips. Why did LR Group contract
Endura, instead of PNG Power directly?
After all, Endura was contracted by PNG Power directly from 2005-2009 to
upgrade the Rouna 2 underground hydropower station supplying electricity to
Port Moresby.
More evidence that LR Group actually knows close to nothing about
hydro power comes from an advertisement posted on the internet site LinkIn. The advertisement conspicuously doesn’t
mention Papua New Guinea, but there is no indication LR Group has hydro
projects going on anyplace else in the Pacific.
The advertisement contents are copied below. Note that the advertisement was placed by a
Ms Yalli Hermish, a law student formerly with the LR Group, but employed only
from March 2011 to August 2012, during which she served as Human Resources
Coordinator. One wonders why the
advertisement wasn’t placed directly through the LR Group’s official company
account that exists with LinkedIn. The
giveaway that this advertisement refers to a position with LR Group is the
e-mail address at the bottom of the page:
--------------------------------------------------------------------------------------------------
Project Manager for Hydropower
Project in Southeast Pacific Region
Yalli H.Law Student
Large-scale Hydropower project
manager required to manage all Hydropower activities in Southeast Pacific
Region.
The job includes: To be responsible for the overall direction, coordination, construction, execution of the project, such as engineering, construction, budget, procurement and more.
Manages day-to-day operational aspects of a project and scope. Define project tasks and resource requirements, plan and schedule project timelines, present reports defining project progress, problems and solutions
Requirements:
At least 10 years of experience in management of Mega Hydropower projects.
Experience with managing International projects abroad- advantage.
Bachelor's degree (BS) in mechanical, electrical, or related technical discipline. MBA - advantage
Possesses a hydraulic and electronic/electrical background.
Technical experience on various types of mechanical & Hydraulic Equipment
English mother tongue level.
The position requires a self-motivated, energetic individual with excellent communication skills.
Readiness for long stays overseas.
Please send your CV in English: hr@lr-group.com
The job includes: To be responsible for the overall direction, coordination, construction, execution of the project, such as engineering, construction, budget, procurement and more.
Manages day-to-day operational aspects of a project and scope. Define project tasks and resource requirements, plan and schedule project timelines, present reports defining project progress, problems and solutions
Requirements:
At least 10 years of experience in management of Mega Hydropower projects.
Experience with managing International projects abroad- advantage.
Bachelor's degree (BS) in mechanical, electrical, or related technical discipline. MBA - advantage
Possesses a hydraulic and electronic/electrical background.
Technical experience on various types of mechanical & Hydraulic Equipment
English mother tongue level.
The position requires a self-motivated, energetic individual with excellent communication skills.
Readiness for long stays overseas.
Please send your CV in English: hr@lr-group.com
--------------------------------------------------------------------------------------------------
As if enough suspicious things about LR Group haven’t already come
out, the PNG Industry News website article that discussed Hydro Tasmania’s
involvement in the SHP hydro plant planning also shared these interesting
thoughts: “The
project, based near Hewai Falls to harness the Tagali river system, will take
six years to build at a cost of K1 billion, according to Hela governor Anderson
Agiru, with private equity funding expected.
This capital expenditure figure is curiously larger than the project’s
K700 million estimate reported by this publication in 2012 and the K300 million
it reported in 2011.” Indeed, even K300
million is a lot of money for a hydro scheme expected to generate so little
power. Inflated numbers in PNG nearly
always mean politicians getting kickbacks from infrastructure development
projects and the sad thing is that they arrange the finances so nicely (always
using overseas accounts) that they never get caught, much less prosecuted. Could LR Group be a willing party in
kickbacks? We don’t know at the moment,
but there have been problems over many years aof Israelis involved in overseas
contracts being involved in kickbacks, which have involved General Electric
itself, maker of the 2 generators bought through LR Group for K94 million:
It would be nice if the Israeli government could investigate and
keep better tabs on their own fly by night companies. But don’t bother to make a complaint here in
PNG to the Israeli government, because they’ll probably contact PNG’s honourary
consular general to find out more what’s going on. Who might they be talking to? It would be none other than Jacob Weiss aka
Jakob Weiss aka Ya'akov Weiss, father of Ilan Weiss who works for LR Group, as reported in the
most recent PNG Blogs article on this scandal.
Jacob Weiss aka Jakob Weiss aka Ya’akov Weiss served on the PNG
Sustainable Development Project Trust (which allocated interest monies from Ok
Tedi’s profits to sustainable development projects throughout PNG) for over 10
years. In 2012, he was forced to step
down because of conflict of interest problems and replaced by Sir Wilson Kamit. Subsequently Weiss participated in
negotiations between PNGSDP and the PNG government, serving the government’
side. He then let Peter O’Neill carry
out the one day nationalisation coupe d’etat in parliament:
After which Peter O’Neill then reappointed Jacob Weiss to the new
PNGSDP board!
Note that the government who now runs and acts as though it owns Ok
Tedi and its PNGSDP is the same government that says it cannot properly manage
state-owned enterprises and thus is moving to sell them.
Note that the same Peter O’Neill who is always talking about
maintaining investor confidence is the same individual who committed the
ultimate horror for private investment anywhere in the world: government nationalisation of private
enterprises.
The relationship between the Weiss son and father, LR Group, and
Peter O’Neill has too many unexplained events and bypassing of good governance
procedure. A Commission of Inquiry is
badly needed to investigate the various activities of LR Group in this country
since it first arrived. Under the
O’Neill government, you’ll never see it happen, unfortunately, because this is
the government that only talks about fighting corruption but takes every
possible move to obstruct any corruption investigations that might possibly
point in the direction of Peter O’Neill.