Discussions are ongoing in Honiara to resolve the long-standing land ownership issues involving Levers Solomon Ltd (LSL) and Russell Island Plantation Estates Ltd (RIPEL).
Prime Minister (PM) Jeremiah Manele confirmed to the media, Monday that a representative from RIPEL is currently in Honiara to hold further discussions with the Commissioner of Lands and the Attorney General.
The focus is on the process and mechanisms to resolve the RIPEL land ownership matter on Guadalcanal.
The Prime Minister stated that details, particularly regarding payment options, are still being finalized.
In a letter to Deputy Prime Minister Bradley Tovosia dated 30 August 2024, Commissioner of Lands Allan McNeil revealed that the government’s position since 20 February 2024 has been the forfeiture and compulsory acquisition of Fixed Term Estates (FTEs).
“Following this decision, the Solomon Islands Government (SIG) and the Investment Corporation of Solomon Islands (ICSI) appointed King & Wood Mallesons to conduct due diligence.
“Their task was to ensure that SIG follows the simplest, cheapest, least litigious, and cleanest method to obtain ownership of the parent companies that own 75 per cent of LSL,” McNeil wrote.
He added that Cabinet had directed the Ministry of Finance and Treasury to settle the LSL estate issue and collaborate with the Solomon Islands National Provident Fund (SINPF) and other state-owned enterprises (SOEs) to pursue the forfeiture and acquisition of FTEs.
“This has been the strategy since Cabinet’s decision on 16 July 2020. However, in each instance where SIG has acted to forfeit or acquire LSL’s FTEs, LSL has filed claims in the High Court,” McNeil said.
Two Options: Forfeiture or Compensation
The letter, written ahead of a delegation led by Minister Tovosia to meet LSL and RIPEL management in Brisbane, outlined two potential options—both carrying significant financial and legal implications.
McNeil noted that the first option—legal forfeiture—is slow, with outcomes delayed by LSL’s persistent legal challenges dating back to 2020.
“LSL continues to deliberately drag out these claims indefinitely,” he said.
The second option—compulsory acquisition—would still require SIG to pay compensation, regardless of the court outcome.
“Even if SIG wins in court, it would still have to pay fair compensation to LSL. While not explicitly stated in the Lands and Titles Act, it is implied that compensation should reflect the market value—particularly around Alligator Creek, Tenaru, and Black Post areas. This may exceed amounts negotiable via receivers or liquidators,” McNeil stated.
However, he noted a crucial exception:
“Compensation would not be required if SIG wins the forfeiture cases involving FTEs closer to Henderson and Bloody Ridge areas.”
This position, sources say, has influenced the view of some MPs who now urge the government to proceed quickly, assuming there would be no financial liability in certain forfeiture cases.
According to published reports, the unimproved land value of LSL/RIPEL holdings stands at $200 million in Russell Islands and $700 million on Guadalcanal.
In his Sine Die speech last year, Prime Minister Manele spent nearly 15 pages of his 29-page address on the LSL/RIPEL issue.
“By settling creditors in Australia, SIG will gain control of Pacific Investment Ltd (PIL) and Overseas Shipping Trading and Investment Ltd (OSTI), which together own 75.1 per cent of LSL,” Manele told Parliament.
“The question being asked now is what will happen to Lavukal Investment Company Ltd (LICL)? Their shares will not be affected. The outcome will see SIG and LICL as partners.”
The Prime Minister added that the government could consider acquiring LICL’s shares if 100 per cent ownership of LSL is pursued—but only if LICL is willing to sell, which is not currently the case.
By Eddie Osifelo
Solomon Star, Honiara
