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Construction of Mendi Airport at 60%
by PNG Business News - May 18, 2021
The redevelopment of the Mendi airport is underway, according to the National Airports Corporation Limited, and is 60 per cent complete.
The project is part of the Civil Aviation Development Investment Program, or CADIP, which funds a range of impact aviation programs. Following a media story, the National Airports Corporation clarified the status of the airport's growth.
According to the study, work is still going on, with 60 per cent of the physical improvements made so far.
The Aviation State Agency has stated that there are no landowner disputes and that the airport redevelopment is taking place within the designated aerodrome district.
Sinohydro Corporation Limited, the construction company, is currently addressing non-conformance problems with the consistency of materials used previously on the runway pavement.
Installation of a security fence, construction of an H65 standard house for the NAC Airport Safety Officer, construction of a tractor shed, and construction of the ASO's office are among the other projects that have been completed to date.
The new terminal building is now under renovation, with paving work scheduled to be finished in September.
The upgrade project at Mendi Airport is worth K27.7 million.
PNG Business News - April 19, 2021
Airport Projects On Schedule
Subprojects funded by the Asian Development Bank's multi-tranche funding facility loans for the Civil Aviation Development Investment Program (CADIP) advancement are on schedule to be completed within the facility's availability span. The multi-tranche financing facility (MFF) is one of the ADB's modalities for assisting clients with their medium to long-term investment program or schedule. Bashirullah Khpalwan, the project team leader for the ADB-backed Civil Aviation Development Investment Program, said CADIP is a multi-tranche financing facility that has been introduced in three tranches as planned. CADIP is scheduled to be completed on November 24, 2021. The 21 national airports that handle the majority of the country's domestic passenger and freight traffic are the target of this investment program. He stated that CADIP's Tranche 1 was approved on December 1, 2009, and was completed in December 2015, while Tranche 2 was approved on November 25, 2013, and has made more than 95% implementation progress and is expected to be completed in September. Tranche 3, the MFF's final tranche, was approved on March 2, 2017, and all contracts have been awarded, with the exception of Kavieng Airport, which will be awarded in 2020. “The Kavieng Airport is on a critical path to completion and all other sub-projects under Tranche 3 are on track for completion as well within the MFF availability period of November 24, 2021. The executing agency for CADIP, the National Airports Corporation (NAC), has agreed with the civil works contractor in Kavieng to an accelerated schedule to complete the entire scope of the project within the availability of the MFF,” he said. Despite the COVID-19 pandemic and its accompanying lockdown, the CADIP team and civil works contractors aim to make strides in 2020, with positive results so far. In terms of cumulative growth and milestones, CADIP Tranche 3 has proved to be one of the highest performing projects in the PARD portfolio in 2020. The investment scheme, according to Mr Khpalwan, is closely associated with the PNG Government's Development Strategic Plan 2010–2030 and National Transport Strategy, which both recognize essential air connectivity to rural areas as a national priority.
PNG Business News - May 10, 2021
Mendi Airport Redevelopment put on Hold
The Southern Highlands Province's Mendi Airport Redevelopment scheme has been placed on hold. The redevelopment of the airport, which was scheduled to be completed in October this year, has been placed on hold, according to NAC acting managing director Rex Kiponge, due to the contractor not having the right materials for the runway and a disagreement among the landowners in Mendi. According to Kiponge, he visited the project site last week to do an inspection, and NAC discovered that the materials used to build the airport's runway were not the correct materials because the contractors struggled on their end, so the contractors were advised to re-do the runway. “I have to admit, we faced a lot of issues not only in Mendi Airport redevelopment but through all the airports under the CADIP Program. The contractors will redo the airport runway and the work on the terminal has not started as yet,” he said. According to Kiponge, there have been several landowner disputes that the provincial government is responsible for resolving. He said that he is eager to resolve the issues and complete the project under CADIP before the Asian Development Bank's deadline of November 24, 2021. The Mendi Airport Redevelopment project includes upgrading the current runway pavement to accommodate Dash 8-400 (Q400) and ATR 0-70 aircraft, as well as the construction of a new terminal building and other developments such as NAC Staff quarters, a tractor shed, an engineer site office, and a powerhouse. CADIP 1 is a sub-project funded by the Asian Development Bank's multi-tranche funding facility loans, and the ADB needs to see proper progress on all project sites completed during the availability timeframe before moving on to CADIP 2, which is scheduled for 2022-2024.
PNG Business News - May 13, 2021
National Airport Corporation to Focus on Redevelopment Projects
The National Airports Corporation plans to devote more resources to the redevelopment projects at Kavieng, Tari, and Mendi airports as part of the Civil Aviation Growth Investment Program. With the exception of three airports, all airports under the CADIP program are on a budget, according to NAC acting managing director Rex Kiponge. Apart from Jackson Airport in Port Moresby, Kiponge claims that the majority of the country's airports are unable to handle the newly launched F100 aircraft. “The introduction of F100 aircraft has deteriorated the condition of runways in PNG. Under CADIP, fencing and runway length deficiencies will now meet the F100 and ICAO requirements. CADIP was implemented to meet the minimum PNG Civil Aviation Rules (CARS) and the International Civil Aviation Organisation (ICAO) standards and recommended practices in all the 22 airports in the country. “The F100 aircraft require a minimum runway length of 1900 metres –– only three airports meet this requirement.” The F100 will be able to land at 12 airports thanks to a CADIP runway length upgrade. Port Moresby is now the only province that meets the operating criteria for F100 planes. Standby control, security fencing, apron parking, runway, taxiway, and apron strength, and a runway length suitable for takeoff at maximum payload are all part of the 22 airport upgrades. Kiponge recently visited the three airports and expressed his satisfaction with the development. Contractors have already finished construction on the security fence at Kavieng Airport, and work on the runway extension is going well. Once the runway extension is complete, the contractors can begin work on the terminal. He mentioned that the runway extension at Tari Airport is complete, and contractors are currently working on the apron, which will be finished until the runway extension is completed. Owing to the contractors' inability to obtain materials for the runway at Mendi Airport, NAC has requested that they redo the runway before moving on to the other areas. “Despite whatever issues within NAC, I will ensure that all 22 NAC’s airports undergoing upgrading will be completed and I will put in a lot of efforts and focus to makes certain work is done well and completed,” Kiponge said.
PNG Business News - July 22, 2021
Oil Search Considering Merging with Santos
Santos, an Australian oil firm, announced its plan to combine with Oil Search Limited. Santos proposed a non-binding indicative merger last month with the goal of making the two companies the regional energy champions. The proposed merged entity has a market capitalization of A$22 billion (K56 billion), putting it among the top 20 ASX-listed companies and the top 20 global oil and gas companies. This means, among other things, that the merger will have a diverse portfolio of high-quality, long-life assets spanning Australia and Papua New Guinea, a solid balance sheet with ample cash to support expansion choices, and an investment-grade credit rating. The merger plan, if approved, would be conducted through a Scheme of Arrangement in which Oil Search shareholders would receive 0.589 new Santos shares for each Oil Search share held, according to Santos in a market disclosure to the Australian Stock Exchange. Following the scheme's acceptance, Oil Search shareholders would control 37% of the combined company, while Santos shareholders would own 63%. Based on Santos' closing price on June 24, 2021, the ownership ratio suggested a transaction price of A$4.25 (10.92) per Oil Search share. This was a 12.3% premium to the Oil Search closing price of A$3.78 (K9.72) on June 24, 2021, and a 9.8% premium to the Mubadala block trade selling price of A$3865. (K9.92). Kevin Gallagher, managing director and chief executive officer of Santos, said the merger will bring more alignment to PNG, allowing for the development of important projects such as Papua LNG, as well as the creation of new employment and support for the local economy. Santos, according to Gallagher, has proposed a true merger in which ownership of the combined firm is based on proportionate contribution and value. “The strategic rationale for a merger is clear and offers superior value to Oil Search shareholders rather than continuing on a standalone basis. “Santos continues to believe that the Merger Proposal represents an extremely attractive opportunity to deliver compelling value accretion to both Santos and Oil Search shareholders.” Oil Search stated in its ASX market update that it is open to receiving and engaging with any proposal that is in the best interests of its shareholders. While the company's board of directors agrees with Santos that combining the two firms makes strategic sense, the conditions must be fair to the company's shareholders, which the terms proposed by Santos are not. Despite Santos shareholders holding 70% more shares than Oil Search shareholders, Oil Search maintains that the proposed conditions provide just a 6.8% premium based on Friday's closing share prices for Oil Search and Santos. According to the firm, no such proposal has been made at this time. Reference: Post-Courier (21 July 2021). "Oil Search Open To Merger with Santos".
PNG Business News - July 21, 2021
Study Says Sweet Potato Growers Have Received Significant Insights into Customers Buying Habits
In Papua New Guinea (PNG), sweet potato (kaukau) growers have received significant insight into customer buying habits, which is assisting them in identifying new market possibilities. The recent market analysis, which was supported by the Papua New Guinea-Australia Partnership and conducted by the Australian Centre for International Agricultural Research, revealed that an increasing number of consumers in Port Moresby prefer to buy fresh produce from supermarkets, citing convenience and safety as reasons. While this trend may result in fewer consumers at conventional farmer markets, PNG and Australian experts believe it may open up new marketplaces for rural people. “Farmers are looking for stable markets where they can receive more consistent prices for better-quality produce,” said Professor Philip Brown from Central Queensland University (CQU), who is leading the research project. “The research shows that consumer behaviour is likely to support an expansion in the supermarket sector in large urban centres and this is positive news for the farmers. This could allow commercial focused farmers to secure more stable market access.” The study of 353 customers was conducted as part of ACIAR-funded sweet potato research sponsored by CQU and the PNG National Agriculture Research Institute (NARI), which aims to improve sweet potato value chains by increasing the quality of harvested roots. Sweet potato quality and production are improving, resulting in increasing supplies to retailers eager to provide better fresh produce. “The project, with support from the Fresh Produce Development Agency and NARI, is helping farmers to build their business skills and connect with emerging supermarket opportunities,” said Professor Brown. Kirt Hainzer, a CQU researcher who collaborated on the survey alongside NARI researchers, said it was the first study to look at customer behaviour and see what role stores may play in the development of PNG's commercial sweet potato sector. “The research sought to better understand and compare how consumers buy staples from open markets and supermarkets and to explore the preferences for purchasing staple foods as supermarkets increase the availability of convenience staples like rice,” said Hainzer. “Although expanding formal sales represents a huge step forward in developing a commercial sweet potato industry, continued research on consumer preferences and the market for fresh produce will help better understand trends in staple food purchasing and what market opportunities exist for growers.” With over a hundred kinds of sweet potato in the nation, NARI economist Raywin Ovah said the study sought to find out which of these customers preferred. “Not all the varieties are preferred from a consumer point of view. There are only a few that consumers want to be based on the taste or health properties and that is what we want to also find out. Farmers can be provided with that information, so they produce those varieties that the market wants.” One of five initiatives under the Transformative Agriculture and Enterprise Development Program is a project to increase commercial sweet potato production and commercialization in the PNG highlands. The ACIAR program, which is funded by Australia in collaboration with the government of Papua New Guinea, aims to improve the livelihoods of rural men and women through private sector-led development, increased agricultural productivity and quality, and the development of individual and institutional capacity. Reference: Loop (20 July 2021). “Study looks into sweet potato industry”.
PNG Business News - July 21, 2021
Garry: MRA Evaluating K50 Billion Worth of Investments
According to managing director Jerry Garry, the Mineral Resources Authority is evaluating more than K50 billion in investments in the country. Wafi-Golpu, Frieda River, and Woodlark are among them. “We are also looking at the Central Lime and Cement,” he said. “If that project comes on-stream, it will be one of the first industrial mines ever built in the country.” Garry was speaking at a Port Moresby consultation session on the Mine and Works (Safety and Health) Bill 2021. PNG, he added, was home to some of the world's largest mines. “We have grown from strength to strength,” he said. “If you compare the Bank of PNG statistics, the mining sector alone, in terms of production, has exported over K17 billion in 2020 and 2019. “So it’s a huge industry that we are trying to regulate and manage.” Garry expressed gratitude to the industry for making safety a primary priority. “They have been taking health and safety at the workplaces very seriously,” he said. “We must not only consider (the workers) and the environment but also people living around the (areas) we operate in. “And if we are using any hazards, we must also take responsibility.” The newest mining methods in Wafi-Golpu, known as block cave mining, are one of the new things to expect, according to Garry. “New mining hazards will come with this new mining method,” he said. Reference: The National (20 July 2021). “Authority assessing investments worth K50bil”.