Maru: Sowom Hydro Project to be PNG Government's Priority
by PNG Business News - September 26, 2022
Photo credit: Papua New Guinea Today
According to Richard Maru, the Minister for Trade and Investment, high electricity costs are a significant barrier to trade and investment in Papua New Guinea (PNG).
With approximately 13% of the population having access to electricity, PNG is one of the least electrified nations in the world due to its inconsistent, costly, and limited supply of energy.
“We continue to rely on the expensive diesel generators when we have vast cheaper and cleaner energy options available- the rivers (for hydro projects) and the sun (for solar farms),” said Minister Maru.
After speaking with a team from the Snowy Mountains Engineering Corporation (SMEC) regarding a feasibility study into the Sowom Hydro Project in East Sepik Province, Minister Maru brought up this issue. The possibility of the hydro project along the Sowom River was investigated by SMEC in a preliminary high-level feasibility assessment in 2014.
“The Marape-Rosso Government is keen to have a full feasibility study done on the viability of one or two hydro projects along the Sowom River,” said Minister Maru.
Currently, diesel generators at Wewak and Maprik supply the approximately 10 megawatts of energy needed in the East Sepik Province.
“It is difficult to attract major investment projects in East Sepik Province without reliable and cheaper power. The Greater Sepik Region cannot continue to depend on expensive diesel generators for electricity,” said Minister Maru.
In order to conduct a thorough feasibility assessment on the Sowom Hydro Project, Minister Maru asked SMEC to put up a proposal and a costing. Before the year is up, he wants the Feasibility Study to be finished.
“I have briefed the Governor of East Sepik Province on this study, and he is very supportive. The availability of cheap and reliable electricity is one of the highest challenges for the entire Greater Sepik Region which must be solved before the region can market itself as a serious investment destination, along with other provinces like Manus, Gulf, West Sepik, and New Ireland who continue to depend on very expensive diesel-fired generators. A combination of hydro, solar energy, and gas-fired electricity supply is the way to go for these provinces,” said Minister Maru.
In order to develop a more affordable and dependable electricity supply to support economic growth and provide cheaper and more accessible electricity to the majority of the population in the country, Minister Maru stated that he will be working closely with the leaders from other provinces and districts across the nation.
“This will also be a major business opportunity to the landowners of the lands where such projects will be located in,” he said.
Reference: Papua New Guinea Today (20 September 2022). “Sowom Hydro Project to be PNG Government's Priority : Maru”.
PNG Business News - May 04, 2021
Australia Supports Electrification for PNG
The Australian government has decided to contribute $US90 million (K315 million) to the Marape government's top-priority Edevu Transmission and Electrification program. The Edevu hydropower plant, which is based in Sogeri, is part of the Papua New Guinea Electrification Partnership, which seeks to reach 70 per cent electrification across the country by 2030 with the support of Australia, the United States, New Zealand, and Japan. Treasurer Ian Ling-Stuckey praised the announcement, calling it a major step forward for the Marape government's electrification efforts. “With only 13 per cent of the nation connected to power, this is a very important and ambitious project,” he said. “We know that the original announcement was made at the APEC meeting. This was a good announcement. But it is one thing to make big announcements and cut ribbons. “Support from our international friends and allies is critical, and I am grateful that Australia, through the Australian Infrastructure Financing Facility for the Pacific, is coming to the party.” Ling-Stuckey stated that the discovery would be on favourable terms, with a $US18 million grant portion (K65 million). The money will be on-loaned to PNG Power Ltd, pending NEC clearance. The Edevu project would have the required infrastructure to link modern hydropower generation to the Port Moresby Grid, allowing diesel generation to be replaced at a lower cost and with less environmental impact. It will also allow for the upgrade of substations to improve grid stability. PPL will now be able to purchase and mount smart meters in consumer premises as part of the funding. Taxes, duties, levies, and fees on supplies, utilities, and facilities available for the project would be exempted as part of the Marape government's contribution.
PNG Business News - August 11, 2021
PNG Signs Agreement with Fortescue Metals Group
The Government of Papua New Guinea has signed a landmark agreement with one of the world's biggest companies to venture into 'green energy' in a partnership that is likely to revolutionise power generation and supply in the near future. In another bold move to "Take Back PNG", the Government today signed the 'Deed of Agreement' with Australian company Fortescue Metals Group (FMG), the world's fourth largest producer of iron ore. The instrument was signed by the Minister for State Enterprises Hon. William Duma and Founder/Owner of FMG Dr. Andrew Forrest; and witnessed and co-signed by Prime Minister Hon. James Marape and Fortescue Future Industries CEO Julie Suttleworth. Prime Minister Marape called the signing "historic" as it paves the way for FMG through its industry company Fortescue Future Industries (FFI) and PNGFFI to explore and later look into developing renewable energy sources that will cover hydro, solar, wind and geothermal power. He said this was the "most appropriate and relevant way to go" as the world moves toward green energy and tries to cut down its carbon footprint. PM Marape added his Pangu-led government was keen on generating clean energy utilizing the country's natural resources - solar, wind, gas and geothermal hot springs. FMG Owner Dr. Forrest is the second richest man in Australia with a net worth of A$27.25billion, according to the Australian Financial Review. PM Marape thanked Dr. Forrest for his "personal choice" to invest in PNG in this frontier sector, calling him "a friend of PNG closer to home". Through a virtual video link, Dr. Forrest explained his personal affinity to PNG in that he had lost an uncle in PNG during World War II, one other reason he has chosen to invest in the country. Already the investor is eyeing sites in Gulf and West New Britian provinces to investigate and study hydropower and geothermal potentials respectively as it continues to explore other sites in PNG, especially geothermal, hydro and solar. PM Marape said Dr. Forrest had revealed during one of their earlier meetings that his company is able to produce over 25 gigawatts (250 billion watts) of power from PNG in renewable 'green hydrogen and green ammonia' energy - sufficient for both domestic use and export to overseas markets. The partnership is frontier-breaking and adds great value to the work the Marape Government is doing nationally in managing the country's natural resources better, and in the region and globally in reducing the impact of climate change through more environmentally-conscious projects. With the recent set up of the National Energy Authority, such projects would be better streamlined and properly operated through the Ministry of Energy, the Prime Minister said. PM Marape then invited Dr. Forrest to join him to advocate on green energy at the United Nations conference on climate change, COP26, later in the year. The signing now allows the company to begin work on acquiring relevant licences to progress work. Minister Duma said a timeframe of no more than three years was being looked at before the first project could be operated. Today's signing event was spearheaded by the Ministry of State Enterprises and its body, Kumul Consolidated Holdings. It was witnessed by government representatives from relevant departments and state bodies.
PNG Business News - September 24, 2021
K3M Hydropower Plant To Be Erected
Photo credit: Samo Trebizan/Shutterstock According to MP Douglas Tomuriesa, a K3 million hydropower plant capable of powering Goodenough Island in Milne Bay will be erected to serve the people of Kiriwina-Goodenough. “We have already contracted it out, we have just recently paid out K380,000 to the contractor and they have told us that it will cost us about K3 million to build a hydropower station,” Tomuriesa said. “That will bring in somewhere between 4.5 megawatts to 6 megawatts of power.” He said that six megawatts would be more than adequate for the island and could easily power a big city. Tomuriesa stated that the firm conducted surveys and that work will continue. On Wednesday, he was in the district to officially inaugurate the Vivigani airstrip, a classroom, and a teacher's residence for Vivigani Primary School. Meanwhile, Tomuriesa stated that four sawmills were located in Alotau and would be spread to the surrounding towns. He stated that the sawmills will be utilized to chop lumber for home construction in preparation for the hydropower station's completion. “It is not easy to get money from the Government so when you see power poles, classrooms and airports coming up, look after them.” He said that the new projects will allow Vivigani companies to expand. About 30,000 cocoa trees may be found on Goodenough Island. “Just two weeks ago, a boat came and loaded 100 bags of cocoa and took them to Alotau, that is more than 25 tonnes of cocoa, that brought an estimated K102,000 into the economy of Goodenough Island. “Organic cocoa is what the world wants, it is what the market wants,” Tomuriesa said. On Goodenough Island, he added, nine cocoa fermentaries had been erected, with another eight on the way, as well as seedlings for local farmers. Reference: Esila, Peter. The National (17 September 2021). “K3mil For Hydro Project”.
PNG Business News - November 28, 2022
Port Moresby Chamber of Commerce and Industry holds 67th Annual General Meeting
The Port Moresby Chamber of Commerce and Industry (POM CCI) held its 67th Annual General Meeting at the Lamana Hotel on the 24th of November 2022 , present to witness the occasion were its members, executives and various stakeholders. The meeting was officially opened by the President and Master of Ceremony Mr. Rio Fiocco who gave his opening remarks and report. He thanked all the POM CCI staff for their hard work this year despite the challenges faced by covid and other changes in the administration. Some of their achievements highlighted included the recruitment of two graduate accountants from the IBS University and the employment of its new membership officer. Mr. Rio Fiocco stated that by 2023 the chamber will be working with Total PNG to pre-qualify its members to be contracted to early works stage of the Papua LNG project . "All members who have issues affecting their business can feel free to come and see us so we can lobby for you through NCD or if it government related we will also lobby for you through the PNG Chamber of Commerce and Industry", said Mr. Rio Fiocco. The treasurer of POM CCI Ms. Akae Beach presented the chambers Financial Report stating that it had made a net surplus of k114,020 which is a 12% net profit margin despite not recouping most of its membership fees. "The Port Moresby Chamber of Commerce and Industry Inc is in good financial position and our net asset stand at K1.49m compared with K1.38m last year , a healthy increase of 8 %. Whilst conditions remain challenging , I am confident that the chamber will continue to be in overall surplus in 2022 as we continue maintaining our current strategy ( with an increase focus on both the Corporate and SME sectors) whilst continuous improvement in our financial systems, increase online and physical marketing efforts and increase member initiatives" stated Ms. Akea Beach. Ms. Akae Beach concluded that she will be leaving the chamber by the end of the year but will still support the chamber within her own capacity.
PNG Business News - November 27, 2022
PM Marape, Ministers and star international business speakers headline PNG Mining & Petroleum Conference in Sydney
Prime Minister Marape headlines a star line-up of speakers at the 16th PNG Mining and Petroleum Conference, in Sydney in December, to promote international investment in PNG. Already over 1000 attendees are registered to attend, as the Conference features a dynamic and engaging program centered around Prime Minister Marape’s announcement of 4 new mega projects and the expected re-opening of Porgera gold mine. Prime Minister Marape will be providing the keynote opening address on Day 1. He will be joined by Australian International Development Minister Pat Conroy. Senior executives of the major international investors in PNG, including Newcrest CEO Sandeep Biswas, Harmony Gold CFO Ms Boipelo Lekubo, TotalEnergies Senior Vice President Mr Julien Pouget, Santos President Upstream Mr Brett Darlie and ExxonMobil PNG Managing Director Mr Peter Larden will be providing a global outlook for their companies’ operations around the world, how they have adapted to emerging trends and how their PNG investments fit into their global portfolios. A highlight will be CEO of Fortescue Future Industries Dr Mark Hutchinson’s presentation of Fortescue’s vision for how green hydrogen can be a gamechanger for the world and PNG’s envisaged role supplying hydrogen to the world. Day 1 concludes with a session featuring former Australian Foreign Affairs Minister, the respected Julie Bishop, presenting her view as to why Australia needs to invest more in PNG, and PNG’s Trade and International Investment Minister Richard Maru outlining the PNG government’s vision for investment and development in non-mining sectors. Each session on Day 1 will feature panels moderated by well-known Australian media personality Ms Ticky Fullerton. Day 2 of the Conference features policy statements by Mining Minister Ano Pala and Petroleum and Energy Minister Kerenga Kua, presentations by Kumul Petroleum and MRDC, project updates on all of PNG’s existing mining and energy projects, and the presentations of the next wave of resource and energy projects – Papua LNG Project, Pnyang LNG Project, Pasca Gas Project and Wafi Gold-Copper Project. Day 3 of the Conference features a unique 3 stream format focused on varied themes including Exploration growth, Climate Change & Energy, Improving Ease of Business, Infrastructure, and Business Success stories. Day 3’s program features a significant list of speakers including heads of government regulatory agencies, CEOs of various PNG and international businesses, and includes international institutions such as the IFC. The Conference concludes with a session that focuses on PNG success stories where resource revenues have been invested for future benefit, and a presentation on the importance of the PNG Sovereign Wealth Fund. “It’s an engaging and dynamic Conference program with a high-profile cast of speakers. I am very grateful for the support that the Prime Minister has provided to the Conference, and the unprecedented participation of Government Ministers and heads of departments and agencies as speakers. Industry and the PNG Government are presenting a united front in promoting PNG as an international investment destination at the Conference. We are pleased that we can work with the Government in this regard. The Prime Minister will be in a unique position in our history by speaking about the advancement of 4 major projects, and the potential doubling of PNG’s GDP in the near future, which can usher in significant economic benefits for our people.” Said Mr Anthony Smaré, President of the Chamber of Mines & Petroleum. “We are also very fortunate that so many high-profile leaders from some of the world’s largest companies have taken time out to come and speak at the Conference to outline why they believe PNG is an important place to invest in. Australian Minister Pat Conroy’s speech will give us an indication of Australia’s view of PNG’s importance. I am personally looking forward to the afternoon session on Day 1 when Julie Bishop will present her view as to why Australia needs to invest more in PNG, and Minister Richard Maru will challenge international companies and countries to invest more into the PNG Government’s investment priority areas such as infrastructure and agriculture.” “Over 1000 people are now registered to attend the Conference, but there is still some seats left, so I encourage business people not already registered, to quickly secure their seats at www.pngconference.com over the next few days. The Conference is unique because you can meet everyone who has a role in PNG’s resources and energy sector - Government policy makers and regulators, the business movers and shakers, landowners, financiers, investors, suppliers and contractors from all over the world – all in one place over three days from 5 to 7 December 2022 at the Sydney Hilton Hotel.”
PNG Business News - November 27, 2022
PM Marape supports development of oil palm industry on a massive scale in PNG
Photo: PM Marape and Governor Bird in discussions with representatives of Pacific Elite Palm Oil Group in Singapore on Monday (November 21, 2022). Prime Minister Hon. James Marape has given his support to development of the oil palm industry in Papua New Guinea on a massive scale. PM Marape gave his support after he and East Sepik Governor, Hon. Allan Bird, met with representatives of Pacific Elite Palm Oil Group in Singapore on Monday (November 21, 2022). The company currently runs an oil palm project in East Sepik, which it wants to emulate in all provinces, saying that it will be an economic gamechanger for the whole country. The company aims to create the largest agriculture-based wealth in the South Pacific, as well as generate electricity for PNG, using oil palm. Governor Bird told PM Marape that if a long-term oil palm development plan was drawn up, with the aim of economic independence for PNG, one million hectares of oil palm grown all over PNG would bring in an extra K100 billion for the country. “We can double our GDP just from palm oil,” he said. “If we go into downstream processing, this K100 billion could double, so that we could be earning K200 billion on top of our current GDP. “The other flow-on to the economy is power production that fits into the grid, carbon credits, increased cattle production, as well as jobs. “Palm oil is amazing because you can do so much with it, including green energy, which can be generated from the waste of palm oil. “If we have 33 operations throughout PNG, similar to what we are doing in East Sepik, 100,000 jobs would be created “This is brilliant.” Governor Bird told PM Marape that oil palm, when made into biofuel, would save the country millions of kina. “If we produce enough palm oil, we don’t need to go out and buy fuel, as we can produce our own,” he said. “It can also bring inflation down as we are no longer importing inflation. “I’m excited because it provides us an escape plan from all these things that are affecting us.” PM Marape welcomed the proposal by Pacific Elite Palm Oil Group and the ideas of Governor Bird, who has helped to grown the vanilla and cocoa industries in East Sepik, and PNG. “As regards expanding nationwide, I invite you to come to Port Moresby, and I will run the investment figures past the super funds and Kumul Consolidated Holdings,” he told the company’s spokesperson Alexander Tho. “A family of investors can easily mobilise the money required for the project. “I also want you to have a stake in the business, and run it, as we cannot do it on our own, in like what Barrick is doing at Porgera Mine.”