(Pictured: Gordon McKellar)
Australia’s Future Fund is assisting the Papua New Guinea Government to establish a sovereign wealth fund to invest some of the money from that country’s natural gas exploitation. Gordon McKellar, the Future Fund chief operating officer, has been advising on the new fund’s operating model.
PNG is establishing a ‘Stabilisation Fund’ and a ‘Development Fund’ as part of managing the anticipated revenues from its liquefied natural gas (LNG) resources. The objectives in regards to the SWF are outlined in the ‘Organic Law’ established last year.
McKellar said last week that his role was to provide assistance as part of the broader Commonwealth Government Department of Finance program to provide advice to PNG on the establishment of its SWF. “More specifically, I’ve been providing assistance with regards to the operating model design and the associated requirements to implement operational capability,” he said.
The Department of Finance advice is being provided under the joint understanding between the Governments of Australia and PNG on further cooperation on the PNG LNG project, and focuses on implementation of the fund, governance and meeting international best practice.
The new SWF will enable PNG to manage its LNG revenues in a transparent and sustainable manner.
McKellar said the assistance provided by the Future Fund fits within its participation in the International Forum of Sovereign Wealth Funds – who’s honorary chair is the former Future Fund chair, David Murray – and its broader engagement with sovereign investors, focusing on best practices, as well as assisting Australia’s Department of Finance.