PNG Business News - Issue 2, 2024

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ISSUE 2 2024

MCWALTER: THE NEED FOR A NATIONAL PETROLEUM DATA CENTRE OK TEDI ACHIEVES RECORD Q1 PRODUCTION ST. BARBARA LIMITED REVEALS 10-YEAR-PLUS OUTLOOK FOR SIMBERI MINE PM MARAPE, ABG’S TOROAMA SIGN JSB JOINT RESOLUTION

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CONTENTS COMMENTARY

The Need for a National Petroleum Data Centre > 10

Marape, ABG’s Toroama Sign JSB Joint Resolution > 36

BUSINESS

Bougainville Explores Partnership with Chinese Investors for Development Projects > 42

Marape Commends Progress on Gurney Airport Project in Alotau > 24 Reigniting ANZAC Spirit: Historic Walk and Business Bond Between Australia, PNG > 26 NZ, PNG Commit to Strengthening Bilateral Ties > 28 Maru: PNG, UAE to Strengthen Trade, Economic Relations > 30 PM Launches Madang Provincial Integrated Development Plan 2023-2027 > 32 PM Announces K18 Million Funding for Madang-Baiyer Road Project > 34

PWC PNG’s 3rd Family Business Survey Unveils Key Strategies for Business Growth > 44 Celebrating a Strong EU-PNG Partnership On Europe Day > 48 PacTow Cites Seafarer Shortage in PNG > 50

MINING

Minister Maru Challenges Lihirians to Plan for Post-Mine Closure > 52 Marape Welcomes Mayur Resources Ltd’s US$155-M Funding for Central Lime Project > 54

ON THE COVER

Ok Tedi Achieves Record Q1 Production > 62 St. Barbara Limited Reveals 10-Year-Plus Outlook for Simberi Mine > 56

St Barbara Limited Revises FY24 Guidance After Simberi Q4 Oxide Operations Update > 66

PNG Embraces Multilateral Minerals Security Partnership Forum for Better Mining Practices > 60

OTML Secures 20-Year Special Mining Lease Renewal > 68

OK Tedi Mining Hosts Mining Minister’s First Official Visit > 62

PanAust Meets Marape to Discuss Frieda River Copper-Gold Project > 72

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CONTENTS OIL & GAS

Kumul Petroleum Brings More Fuel into PNG > 74 Marape Welcomes Petrochina to PNG, Marking a Milestone in Hydrocarbon Sector > 76 Marape Cites Opportunities in Papua LNG, Wildebeest LNG Projects > 78 How SGS’s On-Site Well Services are Revolutionising Gas Production in Papua New Guinea > 80 PNG-Japan Partnership Strengthens with Plans for LNG Project Talks at PALM 10 > 82 MRDC, Twinza Execute Agreements over Pasca A Project > 86

AGRICULTURE

PNG, China Sign Historic Agreement for Coffee Industry > 88 AgResearch Keen to Partner with NARI > 90 PM Announces Enactment of New Forestry Laws to Maximise Resource Value > 90

TOURISM

China Ready Workshop: Unlocking PNG’s Tourism Potential > 92 Belt Again Beach Resort: A Gateway to Serenity and Cultural Riches > 94 PNG Tourism Showcased in Fiji Tourism Expo > 96 PTO Partners with PNG Tourism to Drive Data Excellence > 98

FINANCE

IRC Launches New Debt, Lodgment Letters For Streamlining Taxpayer Communication > 100 Bank of Papua New Guinea Governor Opens Fifth Women’s Micro Bank Branch in Kerema > 101 Kina Monitored: Economic Potential to Increase Currency’s Value > 102 Green Finance Talk: New Zealand Ministerial Delegation Visits BPNG > 104 ‘Investment is Key’: IMF Update on PNG Economic Outlook> 110

COMPANY

Something for Everyone with NiuHomes > 114 Proudly PNG: Remington Technology Honoured as ‘Dealer of the Year’ in Australia-Pacific Region > 115 Tropicair Terminal Upgrade for Jackson Airport > 118

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Downtown Plaza Embracing Sustainable Energy Solutions > 119 New Papua New Guinean Leader for PacTow > 119 Blue Water Opens Bookings for LCL Consolidation Services Connecting Australia, PNG > 120 TIPS For Kids Redefines Ways of Learning > 121 Large-Scale South African Farmer Relies On German Hydropower Expertise For A Third Time > 122 Dataco, Oracle Sign MOU to Introduce World Class Cloud Infrastructure > 124 The Customer is King for Terrain Tamer > 128 JVPS Earns Employer of Apprentices Accreditation, Bolstering Future PNG Workforce > 130

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COMMENTARY

The Need for a National Petroleum Data Centre EDITOR’S NOTE: Michael McWalter, former Director, Petroleum Division and Adviser to the Government of Papua New Guinea and erstwhile petroleum adviser to the Governments of Ghana, Liberia, Cambodia, Sao Tome, and South Sudan comments on the evolution of Papua New Guinea’s oil and gas industry and how Papua New Guinea has fostered the industry into some of its largest investments in LNG production.

Michael McWalter is a certified petroleum geologist and technical specialist in upstream petroleum industry regulation, administration, and institutional development.

Michael McWalter explains the important responsibility to care for the vast amount of petroleum data submitted to the Government by operating petroleum companies and for the need for the establishment of a National Petroleum Data Centre in Papua New Guinea to cater for the vast amount of information arising from petroleum operations.

T

he upstream petroleum industry is a recognised leader in the use of modern technology and has been ever since its foundation, always seeking new and innovative ways to locate the sites of new wildcat exploration wells which may probe the subterranean depths for hitherto undiscovered petroleum accumulations. This is no easy task as most of the easy to recognise prospects have been drilled already, and if they did contain commercial volumes of petroleum that could be extracted, they are by now largely exhausted and depleted of those reserves.

Modern day exploration does not simply seek to drill on dome-like hills to shallow targets next to surface oil seeps as was the modus operandi of Captain Drake at Spindletop in 1859 and his successors. Rather, the

industry intelligently probes deep into the ground where the fundamentals of local geology are conducive to the generation of petroleum, its migration from a carbon-rich source and its accumulation in a porous reservoir within a confining geological structure out of which it cannot buoyantly spill to surface due to an impervious seal or cap rock. It is a high-tech data intensive business.

SEISMIC DATA This probing is most often done using the technique of reflection seismic surveys, much like the familiar echo-sounder used in a hospital image laboratory. Sound waves are directed into the subsurface in intensity and abundance and the many reflections of those sounds from changes in the properties of the rocks (typically, impedance, which is the product of the density of the rock and the velocity of sound in the rock) are equally recorded in abundance.

These impedance contrasts often represent changes in rock strata – the beds of rock from sediments that have been thickly deposited in the Earth’s deep sedimentary basins. The technique is employed both on land and at Publisher Elizabeth Galura Editor Jimbo Owen Gulle info@pngbusinessnews.com Journalist Miriam Mandibi mupalia20@gmail.com

sea. On land, a seismic line of sound sources and receivers are installed at regular intervals and shifted slowly forward after each shock; at sea, a Page 12 >

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Figure 1: From a firing point, an explosive source create seismic waves that travel down through the rock strata where they bounce of boundaries between different rock types and reflect back to surface to be detected by receivers called geophones. (After Mau and Edmundson in Exploring for Oil and Gas, 2014)

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PNG Business News is published for the PNG Business community.

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Commentaries and contributed articles published in this magazine are the views of their authors and do not necessarily reflect the views of PNG Business News – our main role is to provide our readers in PNG and the region with a digest of business news in various sectors of Papua New Guinea.

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COMMENTARY

< Page 10 boat trails a long streamer of receivers which are tugged behind it as a sound source is triggered at regular intervals in the voyage.

With multiple sound sources bouncing off multiple layers of rock to multiple receivers – geophones (essentially strong microphones), a plethora of data is collected. When suitably corrected for varying elevation, geometry, signal-to-noise ratios, correlated, and compiled, a representation of the geometry of the subterranean strata and their structural configuration can be shown. This is compiled in time-sections based on the two-way time for the sound waves to penetrate to and reflect from the depths. To gain more geological reality, these time-sections have to be converted into depth sections using the best estimates of the velocity of sound in each and every stratum penetrated.

This is no mean feat and all manner of algorithms have been created to squeeze out the best seismic images that are the nearest to geological reality as possible. Added to this, seismic surveys may now be conducted not just with straight survey lines, but in 3-D arrays that provide a coherent tie of the data across the entire area of the survey; this necessarily multiplies the amount of data recorded and enables better seismic interpretation of the subsurface.

The seismic data of modern exploration is recorded and endlessly re-processed with ever more finesse of the geophysicist. Old data may be re-processed with modern techniques bringing out more features hitherto undiscerned from prior processing and interpretation. Old data is not simply obsolete, it is extremely valuable. It not only helps new surveys home in on geological leads and prospects, but provides the basic architecture and understanding of the petroleum basin in which one is exploring. Reprocessed seismic data may be added to new seismic data to save significant exploration costs. It thus has to be cared for and maintained in a readable format to enable the petroleum exploration of the future. Moreover, aside from being valuable to the petroleum industry, this vast volume of data about the subterranean geology has many other uses in modern society ranging from helping with earthquake awareness,

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building codes, land stability studies and more. If the data is lost, the only way to recoup it is to conduct the surveys afresh, which is unlikely without the commercial impetus to explore for oil and gas.

OTHER SURVEYS Added, to seismic data is the data derived from other types of geophysical surveys. Years ago, intrepid geologists and explorers took with them delicate geophysical equipment to measure the strength of gravity and the strength of the Earth’s magnetic field as they traversed the land in geological surveys.

A major geological basin filled with less dense sedimentary rocks may reduce the local strength of gravity by about one ten thousandth of its normal value, whilst topographic effects may reduce the strength of gravity by a similar amount for every 400-500 metres of elevation (the gravity at the top of Mount Everest is about 0.2 %

less than at sea level). These were very difficult measurements to make, but as with everything, technology has taken over and airborne gravity and even satellite gravity data is now available. So sensitive are these measurements that geophysicists usually work in units of a milliGal (0.001 Gal) where 1 Gal is an acceleration of 1 cm/sec2 as compared to the average force of gravity of 981 cm/sec2.

Magnetic surveys measure the variations in magnetic intensity. Because igneous basement rocks usually contain more magnetically susceptible iron-bearing minerals, when uplifted or nearer to the surface, they give positive magnetic anomalies which may suggest that the basement of a basin lies nearer to the surface, or indeed that a basin does not actually exist! Again, technology has taken over and aeromagnetic data acquisition is commonly used not only to Page 14 >

Figure 2: Variation of the relative surface variation of the Earth’s gravitational acceleration gravity over different geological features

Figure 3: Example of aeromagnetic anomaly over ferromagnetic igneous dyke. (After Fugro Airborne Survey)

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< Page 12 determine the architecture of a potential sedimentary basin, but to reveal other structural features within it.

Both airborne gravity and magnetic data are nowadays routinely collected as they are cheaper than seismic data acquisition. They have evolved to the point where such work is integral in the early stages of basin exploration, frequently preceding and guiding the acquisition of seismic data. The speed and uniformity of coverage, plus the relatively low cost of airborne surveys, have consolidated their role.

PETROLEUM GEOLOGY Of course, basic geological surveys have fundamental importance, but by their nature, they are only carried out onshore on landmasses where rock outcrops are assessed. That assessment is for the nature of the rocks, their relationship to one another, the structural configuration of the rocks (generally, their dip and orientation), and features of the rock: like fossils; minerals, bedding, jointing, fractures, and veins. This is basic geology which may or may not reveal the presence of a sedimentary basin and the important ingredients for the preservation of oil and gas accumulations. A petroleum geologist is always keen to find geological evidence of source, migration, reservoir, trap and seal, and his first call will be for a geological map of the area of interest for exploration to provide evidence of such pre-requisites for the accumulation of oil and gas.

PRE-REQUISITES FOR A PETROLEUM ACCUMULATION • a source rock typically a dark shale with sufficient organic content that when buried and heated will generate petroleum • evidence of the movement and migration of generated petroleum from source rocks through rock strata, that may then be caught in a reservoir, rather than be leaked to the surface • reservoir rock that has not only sufficient porosity (space between its grains) to contain petroleum, but adequate connection between the pore spaces to permit that petroleum to flow

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• a closure or trap made by a configuration of rock strata that either through folding, faulting or pinch-out define a structure within which petroleum may accumulate • containment or seal of the structure by a barrier to the flow of petroleum, created by impermeable rocks and structures which prevent further upward buoyant movement of petroleum.

This process of elucidating the subsurface to determine prospects where there is a chance of finding petroleum accumulations involves the gathering of enormous amounts of data about our Earth. Such knowledge is only gained at great expense and is therefore valuable data that needs to be preserved for future petroleum industry use and general public use.

Figure 4: Petroleum accumulation fundamentals.

(After Magoon and Dow in The Petroleum System – From Source to Trap, AAPG 1994)

DRILLING With the massive extent of offshore exploration worldwide, the preponderance of petroleum exploration data these days is seismic data, but this is only the start. The hypotheses of the geologist and the geophysicist have to be tested by that most famous “rotary lie-detector” more properly called the drilling bit.

Wells have to be drilled to physically identify whether there is indeed an accumulation deep in subterranean depths and whether there is a reservoir in a trapping structure with an impervious seal and whether that reservoir contains an accumulation is just water, or perhaps oil and/or gas generated and migrated into it.

The process of drilling a wildcat petroleum exploration well is akin to making a movie. It is capitally intensive and budgets can get rapidly out of control. In reality, commercial wildcat exploration success rates worldwide range from 30% to 40%.

This is achieved through very careful prospect definition based on screening the chance of all the necessary ingredients being present in a prospect in the right timing. We must recognise that recoverable oil and gas represents just 6% of the total hydrocarbon fluids generated. Some 65% remains un-expelled from the strata in which it was generated and is now the subject of intense exploitation in the continental USA – as shale gas and shale oil plays.

Of the 35% that does get expelled, 10% is retained in the carrier, 8% is leaked

naturally (as gas and oil seeps), 7% is spilled and bypassed, and 4% is not recoverable. But like movie hits amongst a litany of ordinary movies, there are a few blockbusters that can change the fate of a company and even nations on occasions. It is an industry which employs all skills to do as best it can.

The drilling of a well can cost many millions of US dollars. Whilst it may costs just US$ 2 to 4 million for a simple well onshore in the USA, mid-size companies like ENI and Equinor quote figures of US$ 5 million to US$ 10 per well, but some wells in Papua New Guinea and other remote frontier areas of the world cost of the order of US$ 100 million each.

With such large stakes, it is certainly expedient to manage the exploration data that leads up to the decision to drill most carefully and then to gather as much information as possible during the drilling process to make sure that no hydrocarbons are missed or overlooked, to optimise production in the case of success and to optimise future efforts based on the new knowledge gained.

Figure 5: Petroleum generation and efficiency (After Nahum Schneidermann, Circum-Pacific Council 2006)

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< Page 14

LOGS The process of drilling reveals the nature of the subterranean sediments sequentially as the drilling bit works its way through the strata. Geologists sample and examine the cuttings of rock brought to the surface by the thick viscous drilling mud describing the penetrated rock and looking for signs of oil stain on the cuttings. The drilling mud as it emerges from the hole is whisked to release any entrained gases which are then analysed in a gas chromatograph to determine their type (typically, paraffins or alkanes ranging from methane to pentane). If any signs of oil or hydrocarbon gas are found they are called shows. Special gas detectors examine the drilling mud for noxious gases such as carbon dioxide and hydrogen sulphide, the latter of which is deadly poisonous. Aside from such step-by-step description of the rocks, potential hydrocarbons, and gaseous contaminants, other specific features of the rock may be examined such as density of any shales and the calcimetry of carbonates to distinguish limestone from dolomite. Added to this, many drilling parameters are measured to help optimise the progress of drilling and to identify zone of over pressure in the rock. Masses of data are thus collected and collated in well logs that describe the geology that the well penetrates.

After a section of hole has been drilled, it is logged with special electrical tools that are lowered into the well bore on a strong electrical cable called a wireline. A detailed analytical record of the geology penetrated by a borehole is made recording the petrophysical properties of the strata using a variety of sensors. These measure the natural gamma ray, electrical, acoustic, stimulated radioactive responses, electromagnetic, nuclear magnetic resonance, pressure and other properties of the rocks and their contained fluids. The data itself is recorded and then printed as a well log showing the measured parameters by depth in the well.

The logs of the geology and hydrocarbon shows of the well are analysed together with the physical parameters of the rocks as determined from the wireline logs to deduce the likelihood of there being moveable hydrocarbons within any porosity at the different levels of the well. If there are coherent signs of there being any reservoirs

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Figure 6: Example of part of a mud log (after SLB - The Defining Series: Mud Logging, 2015)

containing hydrocarbon, then well testing may be undertaken to test if these fluid will actually flow to the surface naturally. Again, as a well is tested vast amounts of data are recorded of the type of fluids produced, their quantity and quality, the surface and subsurface pressures during flow and whilst the well is closed, Such data will help in making estimates of the size, shape, and quality of the oil and/or gas reservoir, as well as optimise the future production and recovery strategies.

Whilst this sequence of exploration produces lots of interesting data for the exploration company contracted to or licensed by the host government State,

it must be realised it is all collected with the aim of identifying as big an accumulation of oil and/or gas as possible from which commercial production may be undertaken. Whilst a proper academic understanding of the subsurface geology is necessary to optimise the finding of hydrocarbons, it is only a precursor to production and subsequent sale of the produced oil and gas for value. The international oil companies will not be so interested in the samples and data collected from well once the accumulation has been satisfactorily produced, other than to possibly revisit the field and its wells at some later date if economic circumstances make any

Figure 7: Simplified characteristic response of gamma Ray, resistivity and density logging tools over a sandstone reservoir filled with gas, oil and brine.

(After Oil Field Review, Schlumberger, Spring 2011)

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< Page 16 remaining oil and gas left in the reservoir commercially viable to produce again. The samples and data will have value for future nearby prospecting as they will help elaborate the local and regional geology. However, oil companies wax and wane in their interest over a given area depending on the range of international opportunities that they have for investment. A large discovery in a faraway country may distract an emerging exploration programme that might be on the cusp of success at home. Priorities might be to produce what has been discovered rather than look for more accumulations. The steadfast entities behind all of this are the host government petroleum industry regulators who are only involved with the petroleum potential and outcome of exploration and production in their own jurisdiction.

ROLE OF THE GOVERNMENT PETROLEUM REGULATOR IN RESPECT OF DATA It is a fundamental role of the host government petroleum industry regulator to take care of the data.

In all jurisdictions, the exploring companies must lodge copies of all the data that they acquire in the course of their endeavours with the host government petroleum industry regulators. After all the resources are owned by the people of the Nation and the knowledge that the petroleum exploration data reveals has been obtained at vast expense which would not be made were it not for the lure of potential petroleum accumulations and the possibility of their production at scale making extraordinary revenues for the companies and their host Government alike. Aside from the many task of the government petroleum regulator the care of historic and legacy petroleum data is vital. If all else fails in the administration and regulation of the petroleum industry and its exploration activities, the data acquired from such work must be collated, protected and cared for. It has lasting value to ongoing investment in the petroleum industry and to all other uses of geological data ranging from mineral exploration to geo-hazard awareness to road and other infrastructure development to building codes. The data is quite essentially part of the patrimony of the Nation.

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PNG PETROLEUM DATA The PNG Government’s petroleum data is stored by the Petroleum Division of the Department of Petroleum’s archives and dates back to the early 1920s. The archive contains the results of all exploration endeavours for the discovery of oil and gas to date. As said, this information is the product of immense investment over time and has to be looked after.

The Petroleum Division has indeed attempted to care for this data and has from time to time launched initiatives to improve its data storage and management, but it remains a daunting task notwithstanding the overture of various seismic companies and data specialist companies to help. Considering the enormous value of the petroleum resources that have been and continue to be extracted and exported, far too little attention has been paid to this aspect of the overall business. Given the physical extent of the current Petroleum Division archive, not enough financial and human resources are devoted to its maintenance, and there is an urgent need to bring the management of the PNG petroleum archive held at the Petroleum Division up to current standards. Bilateral, multilateral or even corporate funding could be solicited to help in this process as often occurs around the world.

To date, it is estimated that only around 350 wells have been drilled in the course of exploration work by the oil and gas companies. These wells were based on hundreds of geological field surveys, magnetic and gravity surveys (potential field surveys) and equally hundreds of

Figure 8: Complex plots of well testing data (here Elapsed Time of Test and Pressure Change and Derivative) enable petroleum engineers to gain valuable information about the reservoir and its accumulation of petroleum. (After US Dept. of Energy, Hydro, 2009)

seismic surveys both onshore and offshore. In 2006, it was estimated that the Petroleum Division Archives held at last 65,000 records. One would anticipate that this figure has now risen to around 75,000 records.

In recent years, digital submission in addition to hard copy submission has been encouraged by the Petroleum Division on CD ROMs and in the case of geophysical data on Exabyte or similar tapes. The immediate problem is straightforward and that is the housing of these records in a controlled environment safe from weather, pests and interference.

The author’s own home library with some 4,000 books, papers, files and manuscripts occupies 68 metres of shelf space, so an archive consisting of 75,000 records implies a need of at least 1,275 shelf metres, just to accommodate the primary existing documentation and records. Tapes and other digital media also need constant attention to prevent data deterioration as much a printed paper media.

Figure 9: The commercial side of the petroleum business is an endless wrangle between host Government and the investing petroleum companies. (After Ashkay Jain in When Oil Companies Government Reach Agreement, 2021)

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< Page 18

THE DATA CHALLENGE The ultimate challenge would be to transcribe the entirety of the Petroleum Division archive to permanent memory either to high volume hard disks which can now hold as much as 20 Tera Byte (TB) or to Solid State Drives (SSDs) that can now hold as much as 100 TB. The capacity of data storage devices seems to increase year by year. Fifteen year ago a disk drive that could hold 5TB seemed to be an impossible large. The new 100 TB SSDs are quoted at about US$ 40,000 each.

Just ten of them would represent 1Peta Byte (PB) perhaps enough to hold the complete PNG Petroleum Division archive including all seismic and other geological and geophysical data plus all drilling and production data. The quantum of basic storage costs therefore seems to be about US$ 400,000.

That is not the only cost though as there also have to be systems that can support and operate these data storage devices and enable data to be deposited and retrieved. Back-up systems, data acquisition and preparation drives, scanners to prepare printed media documentation for digitalisation, network access, and maintenance and training all have to be considered. All of this has to be housed in a high integrity building free from ambient dangers with a highly-controlled environment secure from all threats, and its own systems of reliable power supply, and alas an uninterruptible energy source to maintain that reliable supply.

A period of controlled transition during which training would take place would have to maintain the old tradition (paper, tape and CD-ROM) archive alongside the new electronic archive.

One might conjecture the total costs to be of the order to US$ 10 million based on estimates made some fifteen years ago for the Ghana National Petroleum Commission of a West African State and allowing for inf lation and some component reductions in price.

When LNG has been selling from the PNG LNG project at an average of US$ 12.82 per million British Thermal Units (MMBTU), and a LNG carrier tanker, such as the MV Papuan, which has a LNG capacity

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Figure 10: The Ghana National Petroleum Commission (GNPC) has purpose built a petroleum data centre for data holding and operational purposes in the petroleum sector.

Figure 11: The Petroleum Division has recently relocated it archives to its new building in Waigani as a first step toward better data management.

Depicted above is Senior Archives Officer, Mr Kila Kila Navu, who has spent most of this life working at the Petroleum Division.

(Source: Petroleum Division).

of 171,800 cubic metres, leaves the PNG LNG terminal every three to four days, it is estimated that each exported LNG cargo may be worth up to US$ 80 million, and there are approximately 100 such cargoes per year. The cost of establishing a National Petroleum Data Centre is thus 0.125% of the gross revenue of LNG sales.

If we conjecture a notional price of US$ 30 million per well as the cost of re-drilling some 350 historic wells, we can readily reach a price tag of US$ 10 billion for this information. It is not trivial amount and, indeed the value of the accumulated archive is indeed a National treasure

that needs to be looked after well.

This then is a call for the establishment of a National Petroleum Data Centre where not only can the petroleum data be preserved, but it can be made available to the petroleum industry in its future endeavour and other users so that this data serves the people of PNG.

Michael McWalter is a former Director, Petroleum Division and a former Adviser to the Government of Papua New Guinea and has erstwhile been petroleum adviser to the Governments of Ghana, Liberia, Cambodia, Sao Tome, Seychelles and South Sudan.

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PNG BUSINESS NEWS

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22 PNG BUSINESS NEWS

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PNG BUSINESS NEWS 23

BUSINESS

Marape Commends Progress on Gurney Airport Project in Alotau

P

rime Minister Hon. James Marape has lauded the National Airports Corporation (NAC) and the Civil Aviation Development Investment Project (CADIP) for their significant role in constructing the new K76.8 million Gurney Airport in Alotau, Milne Bay Province.

He expressed this during the groundbreaking ceremony held in Alotau, highlighting the initiative as a crucial component of the Government’s Connect PNG initiative.

In partnership with the Asian Development Bank (ADB), the upgrade of provincial airport terminals under CADIP represents a strategic element in the nation’s infrastructure development aimed at bolstering economic growth and tourism.

Since starting in 2010 with CADIP1, the project has facilitated the enhancement of numerous airports across the country, accumulating investments totaling up to K1.6 billion.

The project, expected to complete

24 PNG BUSINESS NEWS

within 26 months, aims to enhance travel time, cargo and passenger handling services, and overall facilities for travellers. This not only supports improved operational efficiencies but also fosters economic growth and tourism development throughout the region.

Prime Minister Marape extended his gratitude to the ADB for their enduring support and underscored the importance of infrastructure in improving the livelihoods of Papua New Guineans.

“Upgrading airport terminals, enhancing safety and security, and generating job opportunities are pivotal for the holistic development of the region,” stated the Prime Minister.

He also remarked on the promising prospects for tourism in Milne Bay and encouraged local leaders to prioritise this sector. The collaboration among the National Airports Corporation, various investors, and the ADB exemplifies a unified commitment to advancing transportation and connec-

tivity within Papua New Guinea.

Alotau’s Gurney Airport proudly stands as the first recipient under the second phase of CADIP, denoted as CADIP 2.

“The diligent efforts by our investors compel us to rise to the occasion, ensuring we match their commitment to delivering 21st-century infrastructure,” added Prime Minister Marape.

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PNG BUSINESS NEWS 25

BUSINESS

Reigniting ANZAC Spirit: Historic Walk and Business Bond Between Australia, PNG By: ROSELYN EREHE

T

he historical ties between Papua New Guinea and Australia run deep, rooted in shared experiences and mutual support. On April 25th, Australian Prime Minister Anthony Albanese and PNG Prime Minister Hon. James Marape embarked on an historic 2-day walk to commemorate ANZAC Day, symbolizing the enduring strength of the relationship.

“May the Spirit of ANZAC, underscored by the bravery and courage these young men exhibited and the mateship that grew between them and our Pacific and PNG carriers, never be forgotten,” PM Marape said for the National Day of Commemoration.

Prime Minister Marape emphasized the importance of honoring the sacrifices made at Kokoda and beyond, highlighting the invaluable contributions of PNG’s own volunteers, known as the “Fuzzy Wuzzy Angels.”

He stressed the enduring significance of courage, ingenuity, and mateship, traits that continue to resonate in contemporary society.

PM Marape emphasized the importance of sharing and rediscovering the spirit of endurance and mateship forged during World War II. He envisioned the trek as a symbolic gesture to reignite the ANZAC spirit and foster solidarity between Australia and PNG. “Why must we do this; you ask?

What is the significance of this task? It is because in the busy grind of work and life, it is so easy to forget the hardships and sacrifices those who went before have made. It is also a necessary feat to share, to symbolise and rediscover the spirit of endurance and mateship that our two people shared during WW2 at Kokoda. The trekking is symbolic to reignite the ANZAC spirit.”

“Australia and PNG must walk hand in hand to carry each other, share each other’s burden, and walk into a future of peace and prosperity that we are working to create for our children to live in,” he added.

One significant aspect of this enduring relationship is the longstanding business partnership exemplified by companies like Steamships Limited (Ltd).

A brief of Steamship Ltd history in PNG, to properly understand and

26 PNG BUSINESS NEWS

From left to right: Australia Prime Minister Anthony Albanese and PNG Prime Minister Hon. James Marape in Port Moresby for Anzac Day, 25th April. -image provided

appreciate this bond between the two countries: Established in 1919, retired sea captain, Algernon Sydney Fitch, founded the business to run operations in Australia. In the same year, he left his Tasmanian Apple farm in Australia and sailed the company’s first ship, the SS Queenscliffe, to Port Moresby to trade along the Papuan coast. In 1924 the public company was formed, and the Steamships history began in PNG, with the company listed on the Sydney – Australia stock exchange.

Historically and up to this date, Steamships Ltd has played a pivotal role in PNG’s economic development, fostering industries and businesses that have contributed to its growth.

According to Port Moresby Stock Exchange (POMSoX) 1999, Steamships Ltd stock was the first company listed on the POMSoX with the company’s stock continued to trade on the Australian Stock Exchange. Noted from the POMSoX, the first cargo was 25 coconut fiber sacks, about 15 pounds of tobacco, and a case of condensed milk.

From its humble beginnings as a coastal trader, to its present status as the largest non-mining company in PNG, Steamships has diversified its operations into logistics, property, hospitality, and manufacturing.

The company’s resilience during challenging times, such as World War 2, highlights its commitment to PNG’s

progress. Despite operations being suspended during WWII, Steamships swiftly restored its retail operations post-war, reopen store in November 1945, demonstrating its dedication to the country’s recovery and rebuilding efforts.

Historically noted, at each stage of PNG’s economic development, seen to be the largest nation and economy in the South Pacific, Steamships has fostered businesses and industries that have helped build PNG. Steamships Ltd has boosted local economies through businesses initially established in Port Moresby, the gulf and western reaches of the former territory of Papua and later in New Guinea and the Highlands.

Moreover, the company’s association with the Multinational Conglomerate Swire & Sons Limited began after WWII in, formally in 1952 with the initiation of the New Guinea Australia Line Service, which used China Navigation Company vessels and steamships as shipping agents.

Steamships’ coastal shipping and stevedoring services supported the PNG economy as it started to develop and explore its rich and diverse endowment of natural resources, including plantation crops and mining.

In response to new opportunities, Steamships diversified into major operating categories of logistics, property and hospitality, and various joint venture operations.

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PNG BUSINESS NEWS 27

BUSINESS

NZ, PNG Commit to Strengthening Bilateral Ties

N

ew Zealand and Papua New Guinea have agreed to strengthen bilateral relations following a meeting between New Zealand’s Deputy Prime Minister and Foreign Affairs Minister, Hon. Winston Peters, and Papua New Guinea’s Prime Minister, Hon. James Marape, in Port Moresby.

Prime Minister Marape recognised New Zealand as a steadfast development partner since 1975 and noted the positive state of current bilateral relations.

He expressed optimism about expanding cooperation in business, trade, and investment, particularly in agriculture and energy sectors, emphasising the principles of a free-market economy.

Highlighting the economic benefits of the Recognised Seasonal Employer (RSE) Programme, especially for New Zealand’s Hawkes Bay Region, Prime Minister Marape requested an increase in the quota for PNG workers.

“I note that PNG seasonal workers are very efficient and call for the increase in PNG’s quota,” stated Prime Minister Marape.

He also extended his gratitude to New Zealand for its prompt support during the COVID-19 pandemic. “The New Zealand government was one of the first to respond to the COVID-19 crisis in PNG, and I express my appreciation and thanks.”

Prime Minister Marape commended New Zealand’s involvement in the Fred Hollows Foundation’s eye care initiatives at Port Moresby General Hospital and lauded New Zealand’s efforts in mediating the Bougainville peace process.

He provided an update on the Bougainville Referendum, emphasising its non-binding nature and the forthcoming discussions in the National Parliament.

In his dialogue with Deputy Prime Minister Peters, Prime Minister Marape stressed the importance of tertiary and technical education for development goals in PNG and other Pacific Island Countries.

He proposed exploring partnerships for open campuses of New Zealand’s tertiary institutions in PNG. Acknowledging ongoing military cooperation, Prime Minister Marape thanked the New Zealand Government for supporting the establishment of the Kumul Leadership Centre at Murray Barracks in April 2022.

On key regional issues, Prime Minister Marape urged continued commitment from both nations as members of the Pacific Islands Forum (PIF) to the 2050 Strategy for the Blue Pacific Continent, focusing on sustainable development and environmental conservation.

In addressing sea level rise and other environmental threats, Prime Minister Marape

28 PNG BUSINESS NEWS

proposed that New Zealand consider cooperating with PNG on land reclamation projects for at-risk Pacific islands, offering an alternative to relocation.

< Page 26 Companies under steamships are Coral Sea Hotels, Pacific Palm Properties, Consort Express Lines and EastWest Transport.

Steamships was the owner of the country’s first manufacturer of ice cream; Laga Industries, makers of the Gala brand, which was sold to Paradise Foods Limited in 2018.

Furthermore, Steamships’ association

with the Swire Group, dating back to the 1950s, underscores its role as a key player in PNG’s economic landscape. The Swire Group has a majority holding in Steamships, which is the largest non-mining company in PNG. The partnership between the company and PNG has facilitated the expansion of services and the establishment of vital connections with other nations, further strengthening PNG’s position in the Asia-Pacific region.

The enduring business relationship between Australia and PNG, epitomized by companies like Steamships Limited, remains integral to both nations’ growth and prosperity.

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BUSINESS

Maru: PNG, UAE to Strengthen Trade, Economic Relations

T

he Minister for International Trade and Investment, Hon. Richard Maru expressed great satisfaction with the outcome of his bilateral meeting with the Minister for Foreign Trade of the United Arab Emirates (UAE), His Excellency Dr. Thani bin Ahmed Al Zeyoudi.

The meeting was held on the margins of the Annual Investment Meeting (AIM) Congress hosted in Abu Dhabi, UAE. Minister Maru attended the 13th Edition of the AIM Congress upon invitation by Dr. Zeyoudi. The conference attracted 175 countries and 12,000 plus participants ranging from both public and private sectors.

Whilst expressing satisfaction with the general outcome of the AIM Congress which he participated in through panel discussions, Minister Maru said his discussion with the UAE Trade Minister for deeper trade and economic relations between the two countries was a good outcome for PNG. Minister Maru said: “The UAE private sector is interested in expanding and deepening the bilateral trade and investment opportunities between the UAE and Papua New Guinea (PNG).

“However, the UAE Trade Minister in our bilateral meeting said that trade and investment relationship between our two countries can only happen following the negotiation of four important agreements.”

Dr. Zeyoudi proposed that the following agreements be negotiated and formalized between PNG and the UAE: 1. Investment Promotion and Protection Agreement (IPPA); 2. Double Taxation Agreement; 3. Air Services Agreement; and 4. A Comprehensive Economic Partnership Agreement (CEPA) Both Ministers agreed for both countries to work towards signing at least three agreements which are IPPA, the Double Tax Agreement, and the Air Services Agreement before December 2024.

“Investment Promotion Authority (IPA) will work on the IPPA, International Revenue Commission (IRC) will work on the Double Tax Agreement, the Department of Transport and Civil Aviation will work on the Air Service Agreement between PNG and the UAE, and the Department of Foreign Affairs will play the coordinating role.

30 PNG BUSINESS NEWS

“The UAE already have Comprehensive Economic Partnership Agreements with other countries like the Philippines and Malaysia and they are willing to share with us their template for us to use to begin the negotiations leading to the signing of the CEPA,” said Minister Maru.

“Whilst NEC has approved to open a diplomatic mission in Abu Dhabi, this will be fruitless when we do not have a trade and investment relationship between our two countries to enable foreign direct investment coming into PNG from UAE and our exports going to the UAE market.

“I want to call on the Department of Foreign Affairs to take the lead in working closely with the relevant agencies and their Ministers to have the three agreements negotiated and formalized before the end this year.

“There are already 22 UAE companies who have registered their interest to invest in PNG and to trade with PNG as a result of connections made during the Expo in Dubai in 2022. However, these companies cannot progress their interest without these critical agreements in place, hence, the UAE Government is keen to have these agreements signed and in place by December 2024,” said Minister Maru.

“The GDP of UAE was over USD700 billion by the end of 2023 whilst PNG’s was USD39 billion. As a mainstay to the economy, oil exports now account for about 30 percent of total GDP, with the UAE diversifying its economy by launching a diversification and liberalization program to reduce reliance on oil and transform its economy from a conventional, labor-intensive economy to one based on knowledge, technology, and skilled labor.

“The federal and individual Emirate Governments have invested heavily in sectors such as aluminum production, tourism, aviation, re-export commerce, and telecommunications. They have also invested heavily in security making UAE one of the safest countries in the world with over 80 per cent of the total population being expatriates.”

“The UAE is looking at diversifying their investment globally and PNG needs to take the opportunity to attract UAE investments, particularly in the non-extractive sector.

“Trade between the two countries has the potential to expand with the UAE particularly interested to invest in the sectors of manufacturing, fisheries, forestry, and agriculture, and also in health technology, and green energy projects like solar.

“However, the UAE investors must feel secure and there must be maximum return for their investments, hence, the agreements proposed by the UAE Trade Minister must be negotiated and agreed on to give confidence to the investors.

“The UAE is an economic leader in the Arab countries and PNG’s exports to the UAE market will be a steppingstone into the Arab market as the UAE offers an access point to the global markets and has effective supply and value chain networks,” said Minister Maru.

“The UAE is willing to enter into a relationship with PNG anchored on trade and investment; the onus is now on us to show our commitment by fast tracking the negotiations on the four agreements proposed by the UAE Trade Minister which will set the foundation for us to open our diplomatic mission in Abu Dhabi.”

Dr. Zeyoudi said upon the formalization of the proposed four agreements, he would lead a delegation of private sector representatives to PNG. “I therefore look forward to the exchange of drafts and signing of these agreements before the end of the year,” said Minister Maru.

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BUSINESS

PM Launches Madang Provincial Integrated Development Plan 2023-2027

P

rime Minister Hon. James Marape has launched the Madang Provincial Integrated Development Plan 2023-2027 in Madang Province.

This marks the first drafted and approved development plan for Madang Province in over 20 years.

Madang Governor, Hon. Ramsy Pariwa, made the announcement at a ceremony held at Bates Oval in Madang Town.

He informed attendees the plan would serve as a compass for the province’s development.

Governor Pariwa commended the Marape-Rosso Government for developing the Medium-Term Development Plan IV (MTDP IV), which allows provincial governments to access public funds by aligning their programs with national initiatives.

Governor Pariwa also called on the Prime Minister to collaborate with his Provincial Government to resolve the ongoing court proceedings hindering the appointment of a Provincial Administrator and to address the completion of key infrastructure projects committed by the government.

These projects include the Baiyer-Madang Road, a four-lane road from Madang Airport to Madang Town, the Madang Airport Terminal, the development of the Pacific Maritime Industrial Zone (PMIZ), and the rehabilitation of cocoa, coffee, copra, and vanilla plantations in Madang.

Additionally, the Governor highlighted the need for better collection of levies and royalties from major projects, especially the Ramu Nickel Project.

He also appealed to the government to consider permanently resettling the people of Manam. Furthermore, the Governor pledged to work with the government to initiate the downstream processing sector of Papua New Guinea in Madang Province.

Prime Minister Marape expressed his pleasure at launching the Madang Provincial Integrated Development Plan 2023-2027. He acknowledged Madang’s significant contribution to the economy of Papua New Guinea and welcomed the Governor’s remarks on the lack of development and support from the National Government for provincial projects.

The Prime Minister committed K10 million to the Madang Airport to Gav

32 PNG BUSINESS NEWS

Store Road, K10 million to the Divine Word University to Modilon Road project, and another K10 million for the rehabilitation of the agriculture sector and plantations in Madang Province.

He noted that portions of the road construction are currently subject to court proceedings but assured that work would begin on the unaffected sections while seeking legal advice on how to proceed with the disputed areas.

Prime Minister Marape reiterated his vision for the people of Papua New Guinea to have robust economic infrastructure

and achieve economic independence. He emphasized the need for collective effort from both the government and the citizens to ensure the success of development programs and projects. He stressed the importance of improving law and order and ensuring that allocated funds are used effectively.

During the event, Prime Minister Marape also launched the District Development Plan 2023-2027 for Usino-Bundi, completed by the late Jimmy Uguro and now set to be implemented by the Madang Provincial Government.

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PNG BUSINESS NEWS 33

BUSINESS

PM Announces K18 Million Funding for Madang-Baiyer Road Project

P

rime Minister James Marape has announced K18 million in funding from the National Government to the Middle-Ramu District to construct the missing link Madang-Baiyer Road.

The road will connect Madang and Baiyer in the Western Highlands Province and will serve as a short and alternate route to connecting the seven Highlands provinces.

Prime Minister Marape announced the funding when launching the Madang-Baiyer Road project and the Middle-Ramu District’s Five-Year District Development Plan 2023-2027 at Sagapi Village in the Kovon Local Level Government area recently.

He said not only Middle-Ramu but many other remote areas like Kaintiba in Gulf Province, Telefomin in Sandaun, Menyamya, and others who have been left out and are not yet connected will be connected through the Connect PNG programme.

“I have come here today because I see your Middle-Ramu Member Hon. Kansol Kamdara has you people in his heart by doing the right thing to connect the district. Therefore, the National Government will fully support the district plan and ensure funding of K100 million will be disbursed to the district in the next five years,” Prime Minister Marape said.

“I have been growing up and attended school in remote areas of the country during my childhood years and know what life is like in areas like Middle-Ramu and I am emotionally taken back.

“I wish we had enough money to fix everything we need to do with money. However, we do not have enough resources, but I urge every one of you not to give up hope. I have to say that one day a machine will come to your area to construct your roads.

“I appreciate the work your local Member and Madang Governor Hon. Ramcey Pariwa are doing to build the Madang-Baiyer Road and have put aside a funding of K18 million. The National Government will also match that and add another K18 million towards that road project.”

34 PNG BUSINESS NEWS

He said that the National Government has the kina-for-kina policy where the government will add the same amount a district or province comes up with on any programme or project that has high economic value and benefits the most people.

Prime Minister Marape said he was pleased to see Middle-Ramu as the first district in Madang Province to come up with a district development plan. The National Government will support the Middle-Ramu District plan and will commit K20 million a year and urged the district to use the resources wisely.

Mr. Marape also challenged the people of Middle-Ramu not to claim any form of compensation or demand money from the contractors who will be working on the Madang- Baiyer Road so the road can be constructed without any hassle.

He urged the people to show a good example to other districts and parts of the country.

“When they are constructing the road, do not claim compensation. I want you to make a commitment and say no to compensation. My good people of Middle-Ramu, do not put claims for monetary gain for your trees being cut, stone and gravels being taken or used on the road, and unnecessary claims The contractors and the Department of Works and Highways know and will assist you as

and when they construct the road.

“The National Government does not want to hear this issue of money and compensation first before any roads or project is constructed, especially in the development of this Madang-Baiyer Road. The road is a vital economic link and lifeline that will last generations, but the money you get will be wasted in days,’’ he said.

Prime Minister Marape said the government does not have enough money to pay for compensation and at the same time build roads.

He said roads will unbundle rural PNG and districts like rural Baiyer, rural Middle-Ramu, and the rest of the country.

The PM also commended the local MP Kansol Kamdara for his efforts and for coming up with the District Plan, which the government will support The National Government also noted the district’s ambition to connect its people with other parts of the country with the Madang-Baiyer Road.

Mr. Marape and Minister for Works and Highways Solan Mirisim, who accompanied the Prime Minister, told the people of Middle-Ramu that the National Government has seen and heard the people’s plight and will fund the road project and the district’s fiveyear development plan.

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PNG BUSINESS NEWS 35

BUSINESS

Marape, ABG’s Toroama Sign JSB Joint Resolution By: ROSELYN EREHE

T

he Papua New Guinea (PNG) National Government and the Autonomous Bougainville Government (ABG) convened for the Joint Supervisory Body ( JSB) meeting to address critical matters concerning the ratification and consequences of the Bougainville referendum.

Prime Minister Hon. James Marape and ABG President His Excellency Ishmael Toroama cochaired the meeting at APEC Haus in Port Moresby following a two-day deferment.

Both leaders delivered opening remarks before engaging in closed-door dialogue and ending the JSB meeting with the successful signing of the Joint Resolution.

PM Marape emphasized the significance of the Bougainville Peace Agreement, highlighting its role in establishing comprehensive peace and providing extensive autonomy to the Bougainville people.

“The Bougainville Peace Agreement is more than just about the issue of independence. It is more than just an agreement for a referendum. It is a comprehensive peace settlement that has seen the insertion of an entire new part into our National Constitution by way of Pat XIV, and it also provides for the highest level of autonomy for the people of Bougainville.”

He pointed out the limited progress in implementing autonomy over the past 23 years, noting that only 11 of the 59 powers outlined in the agreement were transferred.

Additionally, he highlighted the economic challenges faced by the region and stressed the need for enhanced cooperation to facilitate Bougainville’s prosperity, regardless of its future status.

PM Marape underscored the importance of addressing outstanding issues such as the Restoration and Development Grant and equitable sharing of fisheries revenue in alignment with the Bougainville Peace Agreement and the National Constitution.

“In economic terms, the region has failed to harness opportunities for development and growth, and in real terms, the ABG generates just a small

36 PNG BUSINESS NEWS

Front: Prime Minister James Marape, ABG President Ishmael Toroama (Back Row): Minister for Civil Aviation Walter Schnaubelt, Minister for Bougainville Affairs Manasseh Makiba, Ezekiel Massat, Attorney-General of Autonomous Region of Bougainville and Minister for Internal Security Peter Tsiamalili at APEC Haus, for the JSB meeting during the Media Conference.

-Image provided DPM PR

fraction of the revenue required to achieve fiscal self-reliance, or financial independence.

“I put it to leaders here today, that more must be done to lay the foundations that will allow Bougainville to prosper in the future in whatever form that future takes. This requires continued cooperation and greater effort in transferring important powers and functions and ensuring that funding is applied to those areas of greatest need, and which will stimulate and allow for economic growth.

“On this point, I recognize that as a National Government we must once and for all address the issue of Restoration and Development Grant arrears, and we must find an equitable approach for sharing fisheries revenue in line with the requirements of the BPA and the National Constitution.

“I want to conclude by reaffirming my desire to work with President Toroama for as long as it takes to reach an agreement on next steps in relation to the referendum.”

President Toroama echoed the sentiment of Bougainvilleans, urging full support and commitment from PNG national leaders. He emphasized the people’s expectation for concrete actions from the government to honor the agreement reached over 15 years ago.

President Toroama said, “Our people expect your full support and commitment to their cause. They have done their part; it is now your part.

The last thing that we want to hear is that some of you are scheming around and devising options that undermine our cause; and that is not good for your credibility in the eyes of our people.”

He appealed to parliamentarians to grasp the significance of Bougainville’s quest for independence and to uphold the commitments made by previous administrations. He also called for solidarity in realizing the aspirations of the Bougainville people.

“I am committed to the independence of Bougainville. I appeal to our good Parliamentarians to understand our cause. And for our good members of Parliament, please understand the novelty of the deal we made with the National Government and the blessing we require from your decision.

Let the DEAL we made with your predecessors more than 15 years ago come into fruition.”

NATIONAL GOVERNMENT AND ABG CLOSE-DOOR DISCUSSION The closed-door discussions highlighted the final stages of the 2001 Bougainville Peace Agreement, specifically focused on Parliament’s ratification of the Referendum results and a string of long-running issues regarding governance and development.

An agenda paper made available during the significant JSB meeting, states discussion on the issues of the following:

Page 38 >

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BUSINESS

< Page 36 • Fisheries Revenue Sharing • Cocoa Levies • Financial matters which include issues of the Restoration Development Grant and Prime Minister’s Commitment funding, and the Bougainville Copper Limited Shares • Including the major issue of a sessional order for Parliament, on how the ratification process should proceed in Parliament.

As per stated, Bougainville currently receives 5-million Kina annually from the National Fisheries Authority as benefit sharing from its share of tuna exports in the country.

The ABG has been arguing that the current arrangement does not equate with Bougainville waters being rich breeding ground for tuna stocks in the world. The NFA and the ABG Department of Primary Industries and Marine Resource has since been working on a formula for tuna benefits to be shared equally with Bougainville.

The Restoration Development Grant is also up for discussion, as Bougainville is to receive 100 million Kina each year for restoration and development work.

Notably, in 2019, a United Nations moderator establisghed that the National Government owes Bougainville over 800-million Kina in RDGs. The ABG has argued this money is guaranteed under the Constitution and the National Government must honor its regular payment.

Another point of discussion is the Prime Minister’s commitment of another 100-million Kina annually to Bougainville.

RESULT OF THE JSB MEETING Prime Minister Marape and President Toroama discussed post-referendum issues during the JSB meeting, which concluded successfully with several significant agreements aimed at facilitating the ongoing peace process.

According to the Office of the Prime Minister, the discussion of agreements are as follows: Bougainville Treasurer and Finance Minister Hon. Robin Wilson commended Prime Minister Marape for fulfilling all outstanding payments, refuting recent newspaper allegations that the PNG Government had significant outstanding debts to Bougainville.

Minister Wilson highlighted a notable improvement in financial commitments under the Marape Government, stating that since 2019, it has disbursed K350 million of the K621 million owed.

He mentioned that with an allocation of K200 million in the 2024 Bougainville Budget, the total payments will exceed K500 million.

38 PNG BUSINESS NEWS

The leaders agreed on the appointment of a Working Moderator who will assist both the Bougainville and Papua New Guinea governments in several key areas: • Addressing unresolved issues related to the Sessional Order and other matters to bring the results of the 2019 Referendum for independence before the National Parliament.

• Overseeing the preparation of the Joint Consultation Report and addressing other legally mandated issues under s342 (1).

• Supporting the Bipartisan Committee in its efforts to deliver joint awareness messages to Members of the 11th Nation al Parliament.

• It was resolved that a Joint Technical Team from both governments will collaboratively develop the Moderator’s mandate and terms of reference within one week following the signing of this JSB agreement.

Regarding fisheries revenue-sharing arrangements, a long-standing agenda item of the JSB, the leaders directed the responsible ministers to further discuss and finalise this matter.

The ministers, chief secretaries, and relevant agencies will establish a mechanism to conclude the fisheries revenue-sharing arrangement.

Page 40 >

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PNG BUSINESS NEWS 39

BUSINESS

< Page 38

SIGNING OF THE JOINT RESOLUTION

On financial matters, including the Prime Minister’s Commitment and the Restoration and Development Grant, it was resolved that the funding support under the Prime Minister’s commitment programme will cease after 2024.

The funds will be reallocated to settle outstanding RDG arrears owed to Bougainville.

Concerning the issue of Bougainville Copper Ltd (BCL) shares, the leaders recognised delays in transferring shares to the Autonomous Bougainville Government (ABG), primarily due to cost implications associated with stamp duty tax.

The National Government committed to settling the K1-million stamp duty tax through Kumul Mineral Holdings Ltd, ensuring the BCL Shares Certificate is transferred to the ABG by the end of May 2024.

The leaders reaffirmed their commitment to the Bougainville Peace Agreement and to upholding the Melanesian spirit of consensus, ensuring a peaceful progression as both governments approach the final stages of their political journey. The next meeting of the JSB is scheduled for August.

After the Closed Door discussion, both governments held a media conference before the signing of the Joint Resolution on the evening of May 8th.

Mr. Marape expressed gratitude towards the Bougainville Leadership, emphasizing the significance of the referendum held in 2019.

He said, “It has been a long journey.

I want to appreciate, the understanding from Bougainville Leadership. I want to indicate to this country that less we forget the United Nations sanctions, the referendum took place in 2019, 97.7% voted for Independence. The vote was for political Independence and nothing less, nothing more.

“And the leadership in Bougainville in every meeting under former President and now current President and their entire team of leadership come to this discussion with the main focus on the expectations of the Bougainville peace agreement and we honor the wishes of the referendum that the people of Bougainville have expressed through the referendum.”

Mr. Marape also acknowledged the importance of maintaining the integrity of the independence process, stating that

neither government has the individual authority to grant independence outside of established procedures. Both sides agreed in the Joint Supervisory Body (JSB) to call in a moderator to address areas requiring clarification.

Regarding development initiatives, the national government committed to various infrastructure projects.

The PM said, “The national government has picked up, major connect PNG roads, Kieta Port, Kangu area for a possible Port Jetty as well as Buka Port, Aropa and Buka airport to be worked on.

We made commitment to Bougainville Hospital, as well as couple of higher institutions. We were reminded by the Education Minister that Panguna supported PNG in its earliest stage and they have not had a training institution. It is our obligation to give back to Bougainville. “ President Ishmael Toroama expressed optimism about the challenges and opportunities ahead, thanking both the National Government and the Autonomous Bougainville Government (ABG), as well as the people, for their contributions.

“This opportunity lies within the context of the People of Bougainville.”

He added, “I believe there are more challenges and opportunities to move forward.”

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41

BUSINESS

Bougainville Explores Partnership with Chinese Investors for Development Projects

By: PNG BUSINESS NEWS

T

he Autonomous Bougainville Government has announced its intentions to collaborate with foreign investors, particularly from China, to pursue key development projects in the region.

This decision comes amid growing interest from Chinese companies to invest in Bougainville’s infrastructure and economy.

Hon. Patrick Nisira, ABG Vice President and Minister for Commerce, Trade, Industry and Economic Development, made the announcement amid public concerns and interest in ABG’s interactions with foreign investors.

Minister Nisira acknowledged the public concerns about China’s Belt and Road Initiative and emphasized the need for independent decision-making, free from biased information sources.

“Information that influences these perspectives is taken from western media sources, which clouds independent and informed decision making by the government to pursue development initiatives,” he said.

“The dearth of options from traditional development partners over the last 20 years, a rapidly shortening timeframe for self-governance of Bougainville to 2027, and now Chinese companies approaches for partnerships in these very areas, make such opportunities worth considering for the benefit of the people,” he added.

Recent visits by Chinese interests, in-

42 PNG BUSINESS NEWS

cluding the China Railway 25th Bureau Group, Boa Hua Whitehorse group, and Bougainville China Friendship association, have initiated discussions on potential partnerships.

To explore these opportunities, an ABG delegation recently visited Shenzhen and Guangzhou, meeting with senior executives from China Railway Construction Corporation (CRCC).

“The ABG delegation’s trip was undertaken as a return leg reciprocating visits by Boa Hua White Horse Group in 2023 and going back a period of 10 years, and the CRCC Group 25 in March 2024,” Minister Nisira explained.

The ABG delegation met with senior company executives at the China Railway Construction Corporation Global Centre in Guangzhou. It was also a fact-finding mission as part of conducting due diligence on the two companies, forming the basis for continuing with a proposed Cooperation between the parties, he added.

The trip was also intended for the delegation and Cabinet Ministers to evaluate the set-up of the Bougainville Trade Office by the Ministry and Department of Commerce, Trade, Industry and Economic Development.

“Setting up of the Trade Office is cognition of the PNG Sovereign powers and formalities will be established soon between the ABG and the Government of PNG for accreditation of the office to the PNG Embassy in Beijing, China.”

An MoU was signed to foster collaboration, with detailed agreements to be drafted for specific projects. The government sees these investments as crucial for Bougainville’s economic growth and infrastructure development, aligning with its aspirations for nationhood.

Minister Nisira said the Bougainville Executive Council has endorsed the outcome of this mission with an official invitation extended to CRCC to commence scoping exercises for the projects outlined in the MOU. These companies have shown interest in projects like expanding Buka airport, establishing a cold storage facility, improving water supply, and constructing highways and hospitals.

“Bougainville has not seen major infrastructure development since the Japanese government’s JICA-funded bridges program. Bougainville’s alignment with the West for over a century has seen a very slow pace of development and lack of basic services like affordable power, access to water and good road links.”

“As a responsible government, the ABG continues to seek development assistance both within and outside its traditional partnership circles and finds Chinese-led investment which emphasizes Infrastructural Development aligning perfectly with Bougainville’s nationhood aspirations due to the transformational effect it will have on all socio-economic aspects of the region,” he said.

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PNG BUSINESS NEWS 43

BUSINESS

PWC PNG’s 3rd Family Business Survey Unveils Key Strategies for Business Growth By: ROSELYN EREHE

P

ort Moresby Chamber of Commerce and Industry Inc. (POMCCI) recently hosted the Price Waterhouse Coopers (PwC) PNG 3rd Family Business Survey (FBS), presented by Michael Collins Entrepreneurial and Private Business (EPB).

The survey shed light on the dynamics of family businesses, their challenges, and strategies for building trust and sustainability. It was presented on April 18th at Lamana Hotel in Port Moresby, attracting attendees from various companies, businesses, and stakeholders.

SURVEY INSIGHTS The survey gathered insights from 2,043 respondents across 82 territories, including 630 participants from the Asia Pacif ic region and 42 family businesses from Papua New Guinea, marking a 24% increase from the previous survey in 2020.

Notably, 72% of respondents globally, 81% in Asia Pacific, and 88% in PNG were either first or second-generation businesses.

Key findings revealed a mixed performance in the last financial year, with some businesses experiencing double-digit growth in sales while others faced declines.

However, the poll showed optimism about future growth, with strategic priorities focusing on expansion, digital capabilities improvement, and customer loyalty enhancement.

Long-term priorities emphasize the importance of family legacy and value generation.

KEY FINDINGS • Increase sales: Global 61%, Asia Pacific 66% and PNG 69% • Double digit growth: Global 43%, Asia Pacific 41%, PNG 40% • Decline in sales in the last financial year: Global 8%, Asia Pacific 12%, PNG 19% • Growth expectation over the next two years: Global 77%, Asia Pacific 75%, PNG 67% • Expected to restructure or down size over the next two years: Global 3%, Asia Pacific 3%, PNG 12%

44 PNG BUSINESS NEWS

Based on the FBS, the strategic priorities over the next two years are as shown: • Expansion: Global 51%, Asia Pacific 55%, PNG 38% • Improving digital capabilities: Global 44%, Asia Pacific 43%, PNG 38% • Protecting the core business: Global 44%, Asia Pacific 53%, PNG 52% • Increasing customer loyalty: Global 42%, Asia Pacific 40%, PNG 50% • Adapt the business model: Global 34%, Asia Pacific 37%, PNG 45% • Prioritize employee trust: Global 32%, Asia Pacific 30%, PNG 17% • Looking to innovate: Global 27%, Asia Pacific 28%, PNG 7% • Prioritizing reducing carbon footprint: Global 20%, Asia Pacific 12%, PNG 2%

• Family alignment about company direction: Global 59%, Asia Pacific 55%, PNG 50% • Having clear governance structure: Global 65%, Asia Pacific 61%, PNG 57% • Having clear set of family values: Global 70%, Asia Pacific 63%, PNG 57% • Having documented business process: Global 45%, Asia Pacific 36%, PNG 24% • Importance to ensure business stays in the family in the next five years: Global 66%, Asia Pacific 55%, PNG 57% • Creating a family legacy over the next five years: Global 67, Asia Pacific 61%, Pacific 45%

LONGER TERM PRIORITIES

STAKEHOLDER RELATIONSHIPS TO CONSIDER

Respondents showed some greater consistency in prioritizing the generation of long-term value for the family and delivering value to customers.

• Maximizing short-term profits: Global 10%, Asia Pacific 14%, PNG 24% • Importance that business stays in the family: Global 12%, Asia Pacific 17%, PNG 26%

OTHER KEY FINDINGS ON FAMILY BUSINESS: • Trust between family members: Global 74%, Asia Pacific 71%, PNG 66%

Michael Collins Entrepreneurial and Private Business (EPB) PwC presenting the PwC PNG’s 3rd Family Business Survey in Port Moresby, to attendees from various companies, businesses & stakeholders.

-Image provided by POMCCI

Family businesses need to adopt new priorities to build trust and ensure sustainability.

• Customers trust you to provide quality goods and services that meet their expected standards at a fair price.

• Suppliers trust you to pay them on time and meet other supply conditions.

• Employees trust you to treat them fairly and respectfully, compensate them fairly and transparently, provide a safe • working environment and provide appropriate feedback and development opportunities.

• Governments and authorities trust

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PNG BUSINESS NEWS 45

BUSINESS

< Page 44 you to comply with the laws and regulations.

• Shareholders expect you to meet high standards of corporate governance, be transparent, true and fair in your • corporate reporting and for management not to act in their own self-interest.

BUILDING TRUST Trust emerges as a crucial factor for sustainability, impacting relationships with customers, employees, and family members. Respondents highlighted the importance of trust across stakeholders, with varying degrees of confidence in their ability to build and maintain trust.

Key strategies include transparent reporting, communication of values, and active engagement with stakeholders.

Mr. Collins during his presentation emphasized the importance of building trust, as it is “vital in businesses as it is in personal relationships, and from a personal perspective, building trust requires demonstrating credibility and reliability.”

“For example, customers trust you to provide quality goods and services at a fair price, based on expected standards.

While suppliers trust you to do payment on time and to meet other supplier’s demands. Your employees trust you to treat them fairly and respectfully and to compensate them fairly, provide safe working environment, and provide appropriate feedback and development opportunities.”

“Government and authorities trust you to comply with laws and regulations and shareholders expect you to meet high standard of corporate governance and be transparent, true and fair,” he added.

The new formula of trust, based on the survey is referring to the stakeholder groups, customer expectations and businesses toolkits.

• The Stakeholder groups have expanded to customers, employees, family plus public.

• Expectations have grown for excellent service and product, brand recognition and history, plus defined purpose, commitment to Environmental, Social, and Governance (ESG) and diversity, equity, and inclusion (DEI), transparent and effective communication.

• The toolkit has changed and is

46 PNG BUSINESS NEWS

now referring to owners’ annual report letters, website plus social media, speaking out on social issues and, taking action on commitment.

The FBS for 2022 has shown about trust: • Respondents considered having trust of a broad range of stakeholders was essential: Global 93%, Asia Pacific 90%, PNG 88%.

• Respondents considered that they don’t encounter any major challenges building trust with stakeholders: Global 37%, Asia Pacific 34%, PNG 36%.

Based on the survey, PNG family businesses are not taking the actions required to build trust: • Do not have leaders that encourage a culture of accountability: Global 57%, Asia Pacific 63% PNG 76% • Do not have a system in place to gather customer feedback on products and services: Global 66%, Asia Pacific 74% PNG 79% • Do not actively protect and consistently communicate about how it uses customer and employee private data: Global 71% Asia Pacific 81% PNG 88% • Do not effectively respond to and address data/ privacy breaches: Global 73%, Asia Pacific 82% PNG 93% • Do not have a clear purpose statement and commitment that advances diversity, equity and inclusion: Global 79%, Asia Pacific 82% PNG 90% • Do not take a public stance on important issues: Global 84%, Asia Pacific 89% PNG 86% • Do not have a clear and committed ESG strategy: Global 85%, Asia Pacific 89% PNG 98% Building trust with customers: • Feel it is important to be trusted by customers: Global 82%, Asia Pacific 79%, PNG 71% • Believe they are fully trusted by customers: Global 51%, Asia Pacific 44%, PNG 50% Building trust with employees: • Feel it is important to be trusted by employees: Global 68%, Asia Pacific 97%, PNG 62% • Believe they are fully trusted by em ployees: Global 46%, Asia Pacific 41%, PNG 53%

Building trust with family members: • Feel it is important to be trusted by family members: Global 63%, Asia Pacific 45%, PNG 67% • Believe they are fully trusted by family members: Global 74%, Asia Pacific 71%, PNG 66%

KEY TAKEAWAYS According to the survey, to build trust with customers, businesses should focus on measuring and reporting non-financial targets, communicating values, and taking public stands on relevant issues. Similarly, fostering trust with employees involves clear communication of company purpose and values, delivering on non-financial goals, and providing development opportunities.

Building trust with family members necessitates clearly defining roles, establishing governance structures, and transparent reporting on non-financial goals. Strategies include drafting a “constitution” to align family goals and qualifications and implementing formal governance mechanisms.

ACTIONABLE STEPS Businesses can enhance trust by fostering a culture of accountability, gathering feedback from customers, and protecting private data.

Embracing diversity, equity, and inclusion, taking public stances, and committing to Environmental, Social, and Governance (ESG) principles further strengthen trust and sustainability.

CLIENT ENGAGEMENT The survey findings inform discussions with clients on various topics, including remuneration planning, succession planning, regulatory changes, and tax compliance. PwC PNG’s initiatives, such as the NextGen Club and Owner’s Agenda, provide platforms for continued support and collaboration within the family business community.

The 3rd PwC PNG Family Business Survey underscores the critical role of trust in driving sustainability and success. By adopting proactive strategies and aligning priorities, family businesses can navigate challenges, foster longterm relationships, and create enduring legacies.

Family businesses play a significant role in global economies, driving innovation, creating jobs, and fostering long-term relationships.

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PNG BUSINESS NEWS 47

BUSINESS

Celebrating a Strong EU-PNG Partnership On Europe Day By: ROSELYN EREHE

O

n Europe Day, the European Union Ambassador to Papua New Guinea, His Excellency Jacques Fradin, delivered a passionate speech emphasizing the significance of the day and the enduring partnership between the EU and PNG. Ambassador Fradin said, “Some might wonder what is the 9th of May celebration all about? It’s not an independence day, nor a victory, it is about a political declaration considered as the founding vision for the European Union.”

The day commemorates a pivotal moment in European history when French Foreign Minister Robert Schuman proposed a visionary cooperation initiative in 1950. This proposal laid the groundwork for the European Union by uniting former adversaries France and Germany under a common authority to manage coal and steel production, thus fostering economic integration and, ultimately, peace.

Ambassador Fradin highlighted the EU’s role as an alliance for peace, stability, prosperity, and freedom. In a world facing global challenges, such as the ongoing conflict in Ukraine and crises in the Middle East, the EU and PNG stand as close partners in upholding the multilateral order and international law, he said.

The EU Day Reception was held at APEC Haus in Port Moresby. The Head of Delegation of the EU to PNG joined diplomatic staff from various embassies in PNG, the French Embassy, representatives from PNG’s government, local business leaders, and civil society organizations working on EUPNG relations joined the event.

Academics and researchers specializing in EU-Pacific relations, expatriates, members of the local diplomatic community from other countries, invited guests from international organizations operating in PNG, stakeholders, partners and media representatives covering diplomatic events were also present.

Since the establishment of the EU Delegation in Port Moresby in 1977, the EU has supported PNG’s nation-building journey across various sectors, including economic development, education, and governance.

Ambassador Fradin emphasized the

48 PNG BUSINESS NEWS

EU’s commitment to PNG’s immense potential and its people’s rich culture, pledging continued support and collaboration.

Acknowledging PNG’s leadership in global climate negotiations, the ambassador highlighted EU initiatives supporting climate action and rural entrepreneurship in PNG. “While we are proud of the results achieved until now, we are not static. As such, we are currently designing a new programme, which will provide direct support to the PNG national budget and will reward the reaching of policy targets for water, forest and energy infrastructure, included in the PNG Medium-Term Development Plan IV,” he said.

“In particular, the EU recognises and commends the leadership role of PNG in global climate negotiations. We are aiming towards longer-term solutions to address Climate Change and its effects.

“In this context, we have launched in October 2023, with the Prime Minister James Marape, the Forestry-Climate Change-Biodiversity programme in PNG, which is supporting the preservation of forests and biodiversity, decarbonisation of energy production and providing economic opportunities for forest-dependent communities. It is one of the biggest EU action in the world on climate change,” he added.

The ambassador also underscored ongoing efforts to advance good governance, human rights, and gender equality, including the deployment of projects addressing gender-based violence.

“Meanwhile, we continue to support rural entrepreneurship in the country, through the EU STREIT Programme, the biggest EU project in the Pacific, as well as the water and sanitation priorities, through our own WASH interventions.”

The EU-Pacific Economic Partnership Agreement, implemented in PNG since 2009, has been instrumental in enhancing trade relations, particularly in the fisheries sector.

Ambassador Fradin expressed the EU’s intent to broaden the agreement’s scope to other priority value chains, such as cocoa, coffee, coconut, and vanilla, to attract European investors.

Despite challenges in promoting

European investments, the ambassador commended the collaboration with France and European companies operating in PNG, emphasizing the need to address remaining challenges while deepening partnerships.

Ambassador Fradin expressed confidence in the EU-PNG partnership’s continued growth and its contribution to a more peaceful and prosperous future.

As PNG prepares to celebrate its Golden Jubilee, the EU remains committed to supporting the country’s development journey and ensuring its rightful place in the global community, he said.

“I also want to underline the excellent cooperation we have with the PNG Government and its agencies, the civil society actors and the business community. Together, we can make a change for a brighter future.

“The partnership between the EU and PNG is built on shared challenges, as well as on seizing new opportunities for cooperation, and we look forward to consolidate our current actions and enhance our partnership to new areas of common interest,” Ambassador Fradin added.

An exemplary support through provisions of funding is the recent EU provision of emergency funding on April 25th through the “Emergency Toolbox” to assist in unforeseen crises, such as earthquakes and flooding in PNG. Through the European Civil Protection and Humanitarian Aid Operations (ECHO), the EU has made available PGK 807,000 (Euro 200,000) for immediate emergency assistance to people affected by disasters in the East Sepik and Highlands provinces in PNG. The funding, channeled through the International Organization for Migration (IOM), provides shelter materials, essential items, clean water, and hygiene products for affected communities.

“Over the past weeks, floods and earthquakes have cost lives and left a trail of destruction in PNG. The European Union’s humanitarian assistance will support the delivery of essential aid to address the urgent needs of the most vulnerable communities in the hardest-hit areas,” Ambassador Fradin said.

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PNG BUSINESS NEWS 49

BUSINESS

PacTow Cites Seafarer Shortage in PNG

P

NG has a chronic shortage of suitably experienced and qualified seafarers, especially higher-ranking officers, Pacific Towing said in a statement.

The current shortfall is estimated at 30 percent and is predicted to worsen as vessel traffic increases to meet the logistics requirements of the imminent Papua LNG construction phase, the company added.

“The shortage of seafarers in PNG is both a ‘supply’ and a ‘demand’ problem.

In terms of supply, not only is PNG not training and developing as many seafarers as the country requires, but a substantial number of its older, experienced seafarers have retired.

“Additionally, some of PNG’s very best seafaring professionals have secured employment with international maritime operations, further draining the available pool of qualified seafarers,” its statement added.

The demand for PNG seafarers has grown because of the increase in vessels required to service PNG’s communities and businesses, especially its major resource developers. More crew are needed to operate the larger volume of vessels and demand will peak in the next couple of years given that sea and river transport is the primary freight mode for the construction phase of the Total led Papua LNG project.

Strong demand will continue beyond this peak given further developments on the horizon such as the Wafi-Golpu gold mine in the country’s north and expansion of the P’nyang LNG project.

The Papua LNG development is the f irst maritime-supported resource development of its scale since the construction of the Ok Tedi mine in the 1980s. The equivalent development of the PNG LNG project’s facilities required a land transport f leet of more than 600 trucks to deliver over 26,000 loads of cargo.

The current 30 percent shortfall of adequately qualified and experienced seafarers will likely grow to around 50 percent as the number of vessels servicing the Papua LNG construction phase increases, Pacific Towing said.

“It’s not just senior officers that PNG lacks but seafarers with specific technical skillsets such as those required for vessels that service the nation’s growing oil and gas sector.

“Offshore vessels currently being contracted to LNG projects (and potentially

50 PNG BUSINESS NEWS

in the future to offshore projects such as Twinza’s Pasca A in the Gulf of Papua) are required to comply with the stringent operational requirements of the Oil Companies International Marine Forum (OCIMF).

“Compliance for PNG operators will be increasingly challenging without appropriately skilled crew,” it said.

The training and development of PNG seafarers for the oil and gas sector is currently limited by the absence of specific technical training programmes – both

theoretical and practical. No PNG institution offers the necessary course work and very few (if any) offshore operators provide crucial ‘at sea’ training to PNG’s young seafarers, the company added.

Given that PNG shippers need seafarers who have specialist technical skills to win contracts with oil and gas companies, and oil and gas companies in turn need shipping services, it makes sense that shippers and developers work together to grow and upskill the required workforce, Pacific Towing said.

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51

MINING

Minister Maru Challenges Lihirians to Plan for Post-Mine Closure

T

he Minister for International Trade and Investment, Hon. Richard Maru, has challenged the current generation of Lihir to think of the next generation post mine closure during the official launching of the Lihir Investment Fund (LIF) in New Ireland Province.

Minister Maru said: “I have a fear that when all the gold in Lihir runs out, Lihir will become just like Misima -- there will be a black hole and nothing here.

“This will become a reality unless the landowners, the people of Lihir, and the local Member and the Provincial Government think about the future of Lihir and do something about it.

“Our country must learn from the past and not repeat the same mistake.

We need to make sure to build sustainable communities beyond mine closure.”

Minister Maru said Lihir Island currently had a population of about 60,000 with half being children (up to 18 years old), 10,000 in formal employment directly with the Gold Mine or with companies that were involved with the mine, and about 20,000 unemployed.

“Whether you like it or not, Lihir already has 20, 000 people who are unemployed. The mine has not transformed their lives and given them opportunities. But we cannot blame the mine because a mine is not a big employer generator anywhere in the world,” he said.

“The PNG LNG Project only employs 4,000 Papua New Guineans.

Today we have 8 resource projects operating in PNG, but we have the highest unemployment rate, highest problem with foreign currency, highest rate of law-and-order issues, our Kina value is so weak, and we have K60 billion plus debt.

“We have been so over-dependent on the resource sector for the last 49 years and look at where we are now today; the resource sector has never been the answer for Papua New Guinea. So, the question is: what will happen to Lihir when the mine closes?

“The current generation of Lihir must think of the next generation beyond the mine life,” said Minister Maru.

He told the Lihirians there was a window of opportunity for them to do something today, with well over 20

52 PNG BUSINESS NEWS

years left of the mine.

“This is the time for you to step up and talk about how we can chart a new future in the next 20 years you have left of the mine. We all know that Lihir gold is very expensive to extract but the price is also very good, and this is the time to talk to Newmont, your local Member, your Provincial Government, and the State about the future of Lihir.”

Minister Maru called on Lihirians to seriously look at establishing new sustainable industries.

“You must seriously look at new industries apart from the mine that must be located here which will make use of the wharf, and the electricity and water supply that you already have. What is stopping your company to establish a fishing business here in Lihir?

“You are sitting on some of the most fertile fishing grounds of the world. One cannery can produce 5,000 new jobs.

We do not have to continue to send 80 percent of our catch overseas, we need canning industry here including in Lihir.

“These are sustainable industries beyond mine closure. Our Government plans to establish ten canneries in Madang. Why can’t we bring two here and make a deal with Newmont under a new chapter and do a feasibility study to have two canneries here? If it is viable then invest in it so you create jobs in Lihir post mine closure.

“When the mine closes, the fishing business will be here forever. You have over 20 years to go, and you now have a good investor (Newmont) so this is the time to talk to them about your future, and to talk about sharing the wharf,

the power, and water supply with them to bring industries that will be here to create employment and to sustain you beyond mine closure,” said Minister Maru.

He encouraged the Board and Management MRL Funds Limited to grow the capital to take advantage of the investment opportunities in PNG. “I want to congratulate the Board and Management of MRL Funds Limited who, under their management, the assets of the Lihirian’s Equity Trust (LET) have grown from K430 million in 2006 to almost K700 million as at March 2023.

“Given the success of their management of the LET, we are happy that they are starting the LIF so that investors who make money from royalties and others can invest in this fund.

“This fund is basically for individuals and families. However, whilst I commend them, the start of this fund with a seed capital of K40 million is insufficient for any serious investments like the new hotel development at Paga Hill and other emerging investment opportunities as they will require more than K50 million investment.

“I want to encourage the manager and trustee of the LIF to open shareholding for other Papua New Guineans to also buy units into the fund so they can grow the fund quickly and be able to invest in many exciting investment opportunities that will be emerging especially in the Special Economic Zones where we are giving special incentives including tax holidays,” said Minister Maru.

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MINING

Marape Welcomes Mayur Resources Ltd’s US$155-M Funding for Central Lime Project

P

rime Minister and Treasurer Hon. James Marape has welcomed Mayur Resources Ltd securing funding of US$155 million (K540 million) to complete the Central Lime Project (CLP) at K ido in Central Province.

He made the welcome recently after Mayur announced to the Australian Stock Exchange (ASX) that it has secured the funding to complete Papua New Guinea’s f irst downstream manufacturing processing hub, with the potential to create hundreds of new jobs and be a major displacer of PNG’s imported lime products.

“I am happy to hear that Mayur Resources has secured the K540 million funding to complete the Central Lime Project, and that the project has the potential to create hundreds of new jobs, support service businesses, electricity, roads, education and health facilities for landowners,” Prime Minister Marape said.

“It promises to be a transformative development for Central Province landowners and the broader manufacturing sector.

“I thank Appian Capital Advisory LLP for a total of approximately US$115 million debt f inancing to Mayur Resources and Vision Blue Resources’ equity investment into the project of US$40 million announced in November 2023, which will see the Central Lime Project fully funded.

“The funding, I understand, will be used to cover construction costs to achieve an annual production capacity of 400,000 tonnes, along with an allocation for expected further expansion.

First quicklime production is expected to begin after 18 months.

“Cent ra l L ime Project is one of t he f irst approved Specia l Economic Zones (SEZs) which are a focus of my gover nment.

“The establishment of CLP is a testament to my government’s commitment to supporting downstream processing and assisting in attracting investment funds into PNG’s f irst Single Factory Special Economic Zone.

“Such support now sets the scene for PNG to compete with the hundreds of billions of dollars already invested into Southeast Asian SEZs.”

54 PNG BUSINESS NEWS

< Page 52 He said the LIF was very timely because PNG needed investment funds that Papua New Guineans could invest in, as he assured them of the Government’s support.

“Lihir has been generating employment and tax for our country and we are grateful for that. We are concerned about your fu-

ture, and we are ready to back you. We have a responsibility to look after the communities who are now looking after PNG. “There must be a new dream including sustainable industries in Lihir to sustain you.

The fund that we are launching today must find its way back to building sustainable industries in this island. Let’s come up with a new dream - a new destiny for Lihir,” said Minister Maru.

ISSUE 2, 2024 – www.pngbusinessnews.com

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PNG BUSINESS NEWS 55

MINING

St. Barbara Limited Reveals 10-Year-Plus Outlook for Simberi Mine

S

t Barbara Limited recently announced revisions on their FY24 Guidance in relation to its Simberi operations updates.

“St Barbara Limited (“St Barbara” or the “Company”) (ASX: SBM) is pleased to advise the outcomes of its Simberi Expansion Concept Study (“Concept Study”) and inclusion of the projections in this 10 Year Plus Mine Plan Outlook.”

“The Concept Study considered six different cases comprising two f lowsheet options with three different processing rates. Investment in the 3.7 Mtpa options provide the most compelling development pathway – lifting Simberi’s production from its current range of 70-75 koz across FY25 to FY27 to an average of 230 koz from FY28 at an AISC in the range of US$1,000 to US$1,200/oz.”

Andrew Strelein, Managing Director and CEO of St Barbara Limited stated, “The Concept Study provides a strong case for St Barbara to push forward with the larger 3.7 Mtpa throughput options at Simberi.”

He mentioned that they now have a road map that will lead to increased and more prof itable production at Simberi into the middle part of 2030s.

“Our strateg y with Simberi has been to extend the production of oxides into 2026, which we are now executing; increase the Sulphide Resource and Reserve through extension drilling, which is underway; and revisit the sulphide expansion development plan.”

He further noted that The Concept Study is a major milestone in progressing that development plan. “...We are excited about the potential of this project.”

“Given the opportunity at Simberi and the unreasonable treatment of the Company by Nova Scotia Department of Environment and Climate Change, the Company does not intend to allocate signif icant growth capital to the Company’s Nova Scotia Projects

56 PNG BUSINESS NEWS

while advancing Simberi. We can review that position if there is change there.”

St Barbara Limited has revised its full-year production guidance because of some challenges with equipment, fuel supplies, and air transport services resulting from inadequate availability of foreign currency affecting Simberi’s in-country supply chain.

At the start, Simberi’s gold production for Q4 June FY24 was envisioned to exceed 20,000 ounces. This is due to the anticipated access to a higher-than-average grade ore zone in the Sorowar pit.

However, the critical Sorowar ore zone will only be accessible by Q1 September FY25. As an effect, the processing plant will be limited to more typical ore grades of approximately 1.0 g/t AU for June. This is less than the expected production to around 14,000 ounces for Q4 June FY24.

Such loss is caused by the lower-than-targeted total mining movement volumes which is attributed to poor excavator availability. In turn, these issues

resulted in a delay on the targeted face position for accessing the higher-grade Sorowar ore zone.

Due to the operational challenges, the Company adjusted its cost guidance for FY24.

Thus, the new production target is now at 52,000 to 56,000 ounces.

This is down from the previous range of 60,000 to 70,000 ounces. The All-In Sustaining Cost (AISC) was changed to A$3,700 to A$3,900 per ounce, compared to the earlier estimate of A$3,200 to A$3,400 per ounce.

Simberi mine is one of the largest gold mines in Papua New Guinea and in the world. The mine is located in the north of the country on Simberi Island, New Ireland Province. The mine is owned by St Barbara Limited.

SIMBERI OVERVIEW St Barbara Limited’s Simberi Operations started in 2008. The current mining operations is located on the eastern half of the island, spanning a 2,560-hectare mining lease (ML136). The site is around 900 kilometers away from Port Moresby, Papua New Guinea.

Ore from the pit is delivered to the Run of Mine (ROM) pad in front of the process plant through an energy-eff icient 2.7 kilometer aerial rope conveyor, and also transported by mining trucks.

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PNG BUSINESS NEWS 57

MINING

< Page 56

SULPHIDE STUDY TO EX TEND LIFE OF MINE Simberi’s production outlook is positive with the prospect of an investment in additional sulphide processing capability of the sulphide mineralization contained below the oxide pits. According to the 2022 Strategic review at Simberi, there is potential that oxide life can be extended through 2025 and even 2026, and conf irmed the potential for the sulphide project to extend the life of mine by at least 10 years.

SIMBERI 10 YEAR PLUS MINE PLAN OUTLOOK The Concept Study covered six different cases consist of two f lowsheet options with three different processing rates (2.0 Mtpa, 3.0 Mtpa and 3.7 Mtpa).

The two f lowsheet options: a) production of a gold concentrate for sale (referred to as the Saleable Concentrate f lowsheet) b) production of gold doré from ultraf ine grinding (UFG) and cyanide leaching of the concentrate (referred to as the Concentrate UFG / Cyanidation f lowsheet) Mine planning work and compilation of the study report was undertaken by Australian Mining Consultants Pty Ltd (AMC). The process options work was undertaken by Chemech Consulting (Chemech) and the capital estimation

by Professional Cost Consultants (PCC).

According to the Company’s statement, “The Concept Study has demonstrated that the investment to achieve the higher throughput options is compelling under both f lowsheet options. The 3.7 Mtpa Saleable Concentrate f lowsheet is estimated to only require an additional US$16 million compared to the 3.0 Mtpa option.”

“Furthermore, the Concept Study revealed that that the Concentrate UFG / Cyanidation f lowsheet has potential to improve investment returns over the Saleable Concentrate f lowsheet options for any given throughput rate, particularly if metallurgical test work program conf irms lower mass

58 PNG BUSINESS NEWS

pull to concentrate than presently calculated.”

“The 2.0 Mtpa option for both f lowsheets was conf irmed by the Concept Study to offer a lower capital alternative if capital were constrained. The Expansion Capital estimate for the Saleable Concentrate f lowsheet at 2.0 Mtpa in the Concept Study falls to US$156 million compared to US$213 million for the 3.7 Mtpa version. The 2.0 Mtpa option for the Concentrate UFG / Cyanidation f lowsheet is lower still at an estimated US$141 million.”

In summary, here is St Barbara’s 10 Year Plus Outlook for Simberi: • Total gold production of 2.0 Moz • Average annual gold production rising from 70 to 75 koz in FY25 to FY27 to 230 koz through to FY34 • All-in Sustaining Cost (AISC) decreasing to US$1,000 to US$1,200/oz from FY28 to FY34 • Expansion Growth Capital estimated at US$213 million (-20/+30% Class 5 Estimate) across FY26 to FY28 o Assuming 3.7 Mtpa Saleable Concentrate Flowsheet option o Additions to existing circuit: new Ball Mill, Flotation Circuit, Concentrate Shed and Wharf upgrade • Pre-Expansion Growth Capital of between US$40 million to US$55 million across FY25 to FY27 o Studies and Designs, New Sizer, Camp upgrade, RO Plant and miscellaneous improvements • Simberi Mine Plan exceeds 10 years o 81% Measured and Indicated Mineral Resource (less than 19% Inferred Mineral Re source) o No Exploration Targets included o Management pro posing 8,000 plus metre diamond drilling campaign in FY25 • Minimal commitment of growth capital to Nova Scotia Projects before Simberi Expansion completed o pending signs of an improved outlook for permitting and regulation from Nova Scotia Department of Environment and Climate Change (NSECC)

that gold mine exploration, development, and operations are subject to many risks.

The Company noted that the execution of the Simberi 10 Year Plus Mine Plan Outlook in particular faces risks related to the political and economic uncertainties in Papua New Guinea (PNG).

“The formulation and implementation of government policies in PNG may be unpredictable. In PNG there is political focus on potential future policy changes that could involve changes to the existing Mining Act, including in relation to the structure and level of local equity participation in projects, royalty and taxation regimes, proposition of in-country precious metals refining, changes to banking and foreign exchange controls and changes in controls pertaining to the holding of cash and remittance of profits and capital to the parent company.”

Moreover, the renewal of the Mining Lease covering the Simberi Project area by December 2028 might eventually lead to discussions on equity participation and economic benef it agreements.

Regarding operating conditions, these are affected by the disruptions to fuel supplies, equipment parts and consumables, because of diff iculties with availability of foreign currency for supplies in PNG. “Conversely, there continues to be speculation about depreciation of the PNG Kina against the US dollar, whereas St Barbara has assumed an exchange ratio of approximately 3.8 which may or may not prove to be correct over the period.”

RISK CONSIDERATIONS

Photo credit: https://stbarbara.com.au/our-operations/our-simberi-operations/

The St Barbara’s 2023 Annual Report (15 September 2023) outlined

For more information: St Barbara’s 2023 Annual Report (15 September 2023) - https:// stbarbara.com.au/wp-content/uploads/2023/09/2023.09.15-2023-annual-report.pdf Reference: St Barbara’s 10 Year Plus Outlook for Simber (10 May 2024) - https:// stbarbara.com.au/wp-content/ uploads/2024/05/2024.05.10-asx-release-st-barbaras-10-year-plus-outlook-for-simberi_f inal.pdf

ISSUE 2, 2024 – www.pngbusinessnews.com

Regulator of Exploration and Mining Manager of Mineral Resources

Mining Haus, Poreporena Freeway P.O. Box 1906, Port Moresby National Capital District, Papua New Guinea

Phone: (675) 321 3511 Facsimile: +(675) 321 5711 Email: info@mra.gov.pg www.mra.gov.pg

ISSUE 2, 2024 – www.pngbusinessnews.com

PNG BUSINESS NEWS 59

MINING

PNG Embraces Multilateral Minerals Security Partnership Forum for Better Mining Practices By: ROSELYN EREHE

P

NG Minister for Mining Hon. Muguwa Dilu’s online participation in the recent launch of the Multilateral Minerals Security Partnership (MSP) Forum reflects PNG’s eagerness to explore collaborative opportunities within the global mining community and potentially become a member of the Forum.

This inaugural event held on the 9th of April, in Leuven, Belgium has drawn attention from global stakeholders, including PNG, highlighting the country’s commitment to fostering international cooperation in the mining sector for sustainable development.

The MSP Forum is a multilateral cooperation platform within the framework of the Partnership, aimed at bringing together raw materials producing and consuming countries at various stages of development.

The Forum focuses on advancing and accelerating individual projects and promoting policies that contribute to resilient value chains and bring

local value-addition.

Additionally, the Forum will be a platform for strengthened cooperation and policy dialogue with resource-producing countries. It will serve to support and accelerate mining projects and promote a policy dialogue to address the challenge of a secure, sustainable supply of critical raw materials for the green and digital transitions.

According to the MSP Forum, the policy dialogue will implement the objectives of the Critical Raw Material (CRM) Club proposed by European Commission President Ursula von der Leyen.

The idea is to create a dialogue between reliable partners to address the challenge of CRM supply and to assist resource-producing countries in their ambition to industrialize, building on those assets.

It was attended by 33 government representatives from prospective MSP members, including Minister Dilu, the

US Ambassador to PNG Ann Marie Yastishock, and the EU Ambassador to PNG Jacques Fradin, who hosted them at the EU Delegation PNG office.

The MSP Forum, co-chaired by the European Union and the United States, signifies a collaborative effort to promote resilient value chains within the mineral sector.

With opening remarks from Mr. Valdis Dombrovskis, Executive Vice President of the European Commission, and Mr. Anthony Blinken, US Secretary of State, the event underscored the importance of international cooperation in shaping the future of mining practices.

Minister Dilu said the forum presents a unique platform for PNG to engage with international partners and contribute to sustainable mining practices in the country. The EU Delegation to PNG and the US Embassy in Port Moresby expressed readiness to assist PNG in becoming a member of the MSP Forum.

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PNG BUSINESS NEWS

61

MINING

OK Tedi Mining Hosts Mining Minister’s First Official Visit

O

k Tedi Mining Limited recently hosted the Minister for Mining and Member for Kundiawa Gembogl, Hon. Dilu Muguwa, on his first official visit to the mine along with the Minister for Works and Highways and Member for Telefomin Hon. Solan Mirisim.

The visit provided the ministers an opportunity to gain a better understanding of the mine, appreciate the challenges faced by the company and see how the government can support the mine to continue its operations.

“The government is proud of what the OTML Board of Management, the Management Team and the employees are doing. OTML recently renewed its Special Mining Lease (1), and my visit here is to find out plans for mine-life extension and continuity and see how we can support the company in ensuring the mine continues to operate for the benefit of the country,” said Minister Muguwa.

“Ok Tedi Mining Limited is

a 100 percent nationally owned company and as the Minister for Mining matters in the country – it is important that I visit this stateowned mine and see what the company is doing before I go to other mines in the country,” he said.

The ministers had a briefing with OTML’s Executive Leadership team before they were taken on a tour of the mine site and mill operations.

The delegation saw firsthand the daily operations of the mine and its continuous improvement efforts.

Acting Managing Director and Chief Executive Officer Alan Bong, speaking during the visit, emphasised the importance of OTML’s contribution to the country, saying: “Ok Tedi is a proud 100% nationally owned mining company and is a great asset for the country.

“Our production and safety performance this year has been exceptional thanks to our people, and we will continue to move forward aligning with our vision to mine responsibly so that we can continue

to deliver to our stakeholders and leave a lasting sustainable legacy for our people.”

The ministers were impressed with the level of knowledge and technology being applied onsite to safely and effectively operate the mine and mill.

The ministers vowed to support the board and management of OTML to continue mining to 2050 and beyond as the immediate region and country depend on OTML’s success.

Ok Tedi Achieves Record Q1 Production

O

k Tedi Mining Limited (OTML) has announced a record production result for the first quarter of 2024, with an achievement of 26,114 dry metric tonnes (dmt) of copper (Cu), marking a substantial increase of 61% compared to the same period last year which was 16,265 dmt.

In a statement, the company said this record production was complemented with a safe start to the year with a Lost Time Injury Frequency Rate (LTIFR) of zero (0) and Total Recordable Injury Frequency Rate (TRIFR) of 0.22 compared to 2023 with LTIFR and TRIFR recorded at 0.21 and 0.63 respectively.

Unlike in the past, the strong production results this time was achieved with all environmental KPIs at the Mine, Mill and Bige dredging site being fully met.

“This performance is a testament to the Company’s commitment to responsibly enhancing production, implementing strategic business

62 PNG BUSINESS NEWS

improvements, and optimizing operational efficiency across the entire production chain, from mine and mill to the port.

“These results are driven by OTMLs ‘restore, reset, and reinvigorate’ strategy, launched in 2023 to revitalize our business operations.

“Importantly, the Company remains committed to fulfilling our environmental, legal, and social obligations, consistent with its vision to maintaining positive relationships with the communities impacted by our operations, and thereby securing the social license to continue to operate, which is vital for our ongoing success,” it added.

Looking ahead, with the approval for the Mine Life Extension in principle up to 2050 by the OTML Board, the Company is poised for sustainable growth well into the future.

OTML said it is actively pursuing strategic growth projects aligned with our current Strategic Business Plan, which are progressing successfully

and anticipated to generate K30 billion in social benefits over the next 27 years, including taxes, royalties, and dividend payments.

“Our record production in the first quarter of 2024 underscores our commitment to excellence, innovation, and responsible mining practices, which are pillars of our Vision 2023.

“We remain focused on driving value for our stakeholders while contributing to the sustainable development of our communities and the broader PNG economy.”

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PNG BUSINESS NEWS 63

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PNG BUSINESS NEWS 65

MINING

St Barbara Limited Revises FY24 Guidance After Simberi Q4 Oxide Operations Update

S

t Barbara Limited has provided an important update on its gold production outlook from the Simberi Operations for Q4 June FY24.

In a statement, the company said has also revised its full-year production guidance due to ongoing challenges with equipment, fuel supplies, and air transport services resulting from inadequate availability of foreign currency affecting Simberi’s in-country supply chain.

the insufficiency and unpredictability of foreign currency for Simberi’s supply chain.

St Barbara has attempted to mitigate these constraints by using alternative suppliers and procuring parts directly from overseas, but these measures have added to logistical timelines.

Additionally, the availability of foreign currency continues to affect diesel fuel and jet aviation fuel supplies in Papua New Guinea.

While alternative diesel fuel supply arrangements have limited disruptions to mining operations and power generation, Simberi’s air transport services have faced significant additional costs due to curtailed domestic flights across PNG.

FLEET ENHANCEMENTS, FUTURE PLANNING Despite the challenges, the excavator f leet has now returned to

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PRODUCTION IMPACT Initially, Simberi’s gold production for Q4 June FY24 was expected to exceed 20,000 ounces, thanks to anticipated access to a higher-than-average grade ore zone in the Sorowar pit.

However, the critical Sorowar ore zone will not be accessible until Q1 September FY25. Consequently, the processing plant will be limited to more typical ore grades of approximately 1.0 g/t Au for June, reducing the expected production to around 14,000 ounces for Q4 June FY24.

This shortfall is primarily due to lower-than-targeted total mining movement volumes, attributed to poor excavator availability. These issues have delayed the targeted face position for accessing the higher-grade Sorowar ore zone.

REVISED FY24 GUIDANCE As a result of these operational challenges, St Barbara has adjusted its full-year production and cost guidance for FY24. The revised production target is now set at 52,000 to 56,000 ounces, down from the previous range of 60,000 to 70,000 ounces.

The All-In Sustaining Cost (AISC) has been revised to A$3,700 to A$3,900 per ounce, compared to the earlier estimate of A$3,200 to A$3,400 per ounce.

EQUIPMENT, SUPPLY CHAIN CHALLENGES Total material movement has been significantly impacted by the availability of the excavator fleet, a problem that persisted through Q3 March FY24.

Restoration of usual performance has been hindered by delays in the arrival of repair components, driven by

66 PNG BUSINESS NEWS

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MINING

OTML Secures 20-Year Special Mining Lease Renewal By: ROSELYN EREHE

O

k Tedi Mining Limited (OTML) recently renewed its Special Mining Lease (SML) 1 (0), gaining an additional 20-year lease term from 2022 to 2042.

This is the second SML 1 (0) lease term extension for OTML. During the event, the Minister for Mining, Hon. Muguwa Dilu, encapsulated the rich history, significant achievements, and promising future of one of Papua New Guinea’s premier mining ventures.

Hon. Dilu said: “As an SOE (State Owned Enterprise), OK Tedi has been paying healthy dividends to the state every year, thus contributing to the economy, government revenue and improving livelihoods in communities around PNG.” “Last year, OTML announced that the mine’s life will be extended to 2050 and a potential future income of K30 billion. So, it was not hard for the government to renew the Special Mining Lease for OK Tedi because the old SML had expired. The granting of the new SML will now allow OTML to continue operations for the long term,” he added.

The process, initiated SML 1 (0) lease, was granted in 1981 and expired in May 2002, but was extended for another 20 years until its expiration in 2022.

An application for the renewal of the SML 1 (0) and associated leases for mining purposes in compliance with the Mining Act 1992 provisions was lodged with the Mineral Resources Authority on 20th December 2021, resulting in the current extension grant.

Furthermore, the SML 1 (0) lease renewal includes renewal of 22 Lease for Mining Purposes (LMP) and two (2) Mining Easement, which are tied to the term of SML 1 (0).

The 24 ancillary leases host supporting infrastructure for the mining operations, while the SML 1 (0) lease is the host area for active mining and milling operations activities.

68 PNG BUSINESS NEWS

Minister Dilu reiterated: “The renewal of the SML clearly demonstrates the government’s confidence in OTML.” According to the OTML update during the significant event, the Company is also currently carrying out its awareness sessions throughout its impacted communities in preparation for its Community Mine Continuation Agreement (CMCA) extension review, which is expected to be completed in October 2025 with the signing of the Agreement to continue mine operations.

Hon. Dilu likewise lauded the leadership of Hon. William Duma and regulatory support from the Mineral Resources Authority (MR A). Since commencing operations in 1984, OTML has transitioned from a gold mine to a prominent copper-gold operation, contributing substantially to the nation’s economy and community development.

OTML’s ownership structure underscores the country’s commitment to empowering its people through resource ownership. Over the years, the company has made significant contributions to the nation’s econo-

my and local communities.

With 5.17 million tonnes of copper, 15.9 million ounces of gold, and 36.4 million ounces of silver produced since inception, OTML’s operational growth is undeniable.

The company has made significant financial contributions to the state over the years, demonstrating its commitment to various stakeholders. This includes: • PGK 13 billion in dividends to PNG shareholders • PGK 515 million to the Tax Credit Scheme (1997 – 2022) • PGK 972 million for the CMCA Payments (2001 – 2021) • PGK 10.2 billion in taxes and duties • PGK 1.5 billion in compensation • PGK 1.3 billion in royalties OTML’s current production, export volume earnings in 2022, OTML has contributed 3.6% of PNG’s Gross Domestic Product. In 2023, it declared a K450 Million Dividend, underscoring the company’s substantial impact on the economy and local communities.

Hon. Dilu also expressed gratitude to the board, management, and staff for their dedication and resilience, especially during chal-

From left to right: SOE Minister William Duma, OTML CEO and MD Kedi IIimbit, MRA MD Jerry Garry and Minister for Mining Hon Muguwa Dilu.-image provided

by Office of Minister for Mining, PNG.

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PNG BUSINESS NEWS 69

MINING

< Page 68 lenging times like the COVID-19 pandemic and drought.

Looking ahead, OTML’s future is promising, the minister said, as the company is positioned for sustained growth. Strategic projects outlined in its business plan are expected to generate K30 billion in social benefits over the next 27 years, reinforcing OTML’s role as a catalyst for economic development and community empowerment.

Minister Dilu added: “The Ok Tedi mine has been operating for 33 long years. OTML as a SOE has been operating for 22 years. We have history, we have experience, and as a business, the future is just fine. I want to see OTML grow in the following areas:

< Page 66 target availability. In response to the recent issues, St Barbara plans to expedite the acquisition of an additional excavator initially scheduled for FY26, aiming to mitigate future impacts from supply chain disruptions.

1. I want to see OTML operate another mine outside of Western Province. PNG is a big country; I am sure OTML can operate a second mine in the country.

2. Or like Oil Search Limited had done, OTML can go international.

The world is a big place. Surely, we can find an other place with the same or better resources that we can open another mine.

3. Another option that I think OTML should consider is down stream processing. We should start a serious conversation on refining our copper onshore and export the finished product to markets over seas.

The benefits are huge. OTML is best placed to do that.”

OTML Managing Director and Chief Executive Officer, Kedi

Ilimbit, also spoke at the SML 1 presentation event at the Stanley Hotel in Port Moresby.

He thanked all stakeholders involved in furnishing the extension of the SML 1 (0), citing OTML’s gratitude and excitement in continuing to explore opportunities for sustainable resource development in the region while also providing social and economic benefits to its impact communities and the country.

Mr Ilimbit emphasized OTML’s commitment to fulfill the environmental, legal, and social obligations, maintaining positive relationships with the communities impacted by the company’s operations, and securing the social license to operate, which is vital for its ongoing success.

The trucking fleet is also performing at target levels following recent supplements, with further enhancements expected from the arrival of two larger 60-tonne Volvo articulated dump trucks.

These trucks will be trialed ahead of selecting the most suitable fleet for the proposed sulphides mining

expansion from FY28.

The purchase of a skid-mounted sizer, suitable for both oxide and future sulphide ore, is progressing well. This unit is expected to enhance protection for the overland conveyor and grinding mills, thereby reducing vulnerability to downtime.

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PNG BUSINESS NEWS

71

MINING

PanAust Meets Marape to Discuss Frieda River Copper-Gold Project

A

PanAust delegation of seven recently met with Papua New Guinea Prime Minister the Hon. James Marape to discuss the nation-building Sepik Development Project that includes the Frieda River Copper-Gold Project and Frieda River Hydroelectric Power Project.

These are among a multitude of other infrastructure projects that will enable the economic transformation of the north-western border region of Papua New Guinea, PanAust said in a statement.

In meeting Marape in Port Moresby, PanAust elaborated on key aspects of the Project including its enormous economic impact, its job creation potential, the need to minimise environmental risks, and how it would have a catalytic impact on PNG’s regional and national growth.

During the meeting, PanAust Managing Director and CEO Daling Zheng reiterated the company’s pledge to prioritise local hiring and procurement, ensuring that the benef its of the Project would be felt across the entire supply chain and within project impact areas and nearby communities.

He also emphasised Frieda River and PanAust’s dedication to environmental stewardship and ongoing community engagement, highlighting the company’s intention to operate in accordance with the highest environmental standards.

“On behalf of our shareholder Guangdong Rising Holding Group, I would like to say how grateful we are for being given the opportunity to engage in constructive dialogue with the Prime Minister and the Government of Papua New Guinea,” Mr Zheng said.

“As discussions progress, I want to restate that we remain steadfast in our commitment to fulf illing regulatory requirements and engaging in meaningful discussions with government stakeholders and local communities.

“The Sepik Development Project represents not only a signif icant investment in Papua New Guinea’s natural resource development history for us, but also a commitment to helping foster long-term growth and prosperity in the country.

“We believe that by working hand

72 PNG BUSINESS NEWS

in glove with the government and local stakeholders we can unlock the full potential of this Project and create lasting positive change for generations to come,” Mr Zheng said.

Prime Minister Marape expressed his support acknowledging the Project’s potential to stimulate development of remote rural communities especially in the two Sepik Provinces.

“The project represents a signif icant opportunity to harness our natural resources responsibly and create lasting benef its for the people of Papua New Guinea.

“The broader Sepik Development Project has the potential to become a cornerstone of Papua New Guinea’s economic development strategy, attracting further investment in our northern region and bolstering our position in the global economy,” Prime Minister Marape said.

Frieda River Limited and PanAust remain dedicated to continuing to work collaboratively and transparently with the PNG Government and the impacted and affected communities to ensure the Project’s success whilst upholding the highest levels of social responsibility, corporate governance, and sustainability.

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PNG BUSINESS NEWS 73

OIL & GAS

Kumul Petroleum Brings More Fuel into PNG

K

umul Petroleum Holdings has organised more shipments of fuel, including vital Jet A1 to alleviate the current shortages experienced by the country.

Kumul Petroleum managing director, Wapu Sonk, advised: “We are aware that current fuel importers are unable to meet the demand for fuel, particularly the Jet A1 used by the aviation industry, and once again we have stepped in to address this shortage.”

In April, Kumul Petroleum organised a tanker of fuel that averted a previous fuel supply crisis brought about by Puma’s withdrawal in supplying fuel to the country.

Following up this initiative. Kumul Petroleum is stepping in for the second time to bring fuel into the country, and two shipments have been organised.

“The first of approximately 38 million litres of diesel and 8 million Litres Jet A1 has been purchased from Puma in Singapore. This will be sold to Puma in PNG, and is arriving on the tanker Nord Miyabi, which is expected to discharge its cargo in

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Port Moresby on or about 21st May.” “The second shipment of 8 million litres of Jet A1 has been purchased from ExxonMobil and this is expected to arrive in the country on the 1st or 2nd of June.”

The total import should be enough to cover market demand for at least two months, Mr Sonk said.

“We are aware that until the country’s fuel supply chain arrangements stabilise, KPHL will be actively involved in the import and marketing of fuel for as long as it takes to ensure that there is a reliable and constant supply to the country to ensure continuity of fuel supply to essential

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businesses, industry and the public.”

“We have reached agreement with Puma to acquire fuel from them and for them to buy and use their infrastructure to distribute to the country for the near term. This arrangement will ensure fuel and energy security for the country, especially with regard to Jet A1, for the foreseeable future.”

“KPHL is also working on a medium to long term fuel supply solution as requested by the NEC and our legislated mandate to ensure a fair and level playing field for the energy industry as well as reduce the demands for US dollars for fuel in the country,” Mr Sonk said.

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PNG BUSINESS NEWS 75

OIL & GAS

Marape Welcomes Petrochina to PNG, Marking a Milestone in Hydrocarbon Sector

P

rime Minister Hon. James Marape announced that Papua New Guinea continues to be a prime destination for business ventures, highlighted by PetroChina International Co. Ltd’s recent entry into the nation’s hydrocarbon industry.

Prime Minister Marape officially welcomed PetroChina into Papua New Guinea on Wednesday, April 17, coinciding with the loading of the first LNG cargo onto the tanker ship Wudang, which berthed at the PNG LNG Plant wharf at Caution Bay, just outside Port Moresby.

“PetroChina International Co. Ltd, the largest oil and gas producer in the Asian continent and a top 50 company globally, joins sector giants already operating in the country, such as Exxon Mobil, Total, and Santos. Papua New Guinea is so blessed to have them,” said Prime Minister Marape.

He emphasised the significance of PetroChina’s entry into the PNG hydrocarbon market as a milestone achievement, partnering with the national oil and gas company, Kumul

Petroleum Holdings Ltd (KPHL).

KPHL Managing Director Wapu Sonk highlighted the landmark achievement.

“This is the first time for KPHL to market our equity share of LNG production from the PNG LNG Project that is above the long-term Sales Purchase Agreement volumes,” he said.

“Kumul Petroleum has a 16.77 percent share in the PNG LNG Project, entitling us to sell approximately 14 LNG cargoes over the next four years.

Additionally, once we conclude the acquisition of an extra 2.6 percent of the PNG LNG Project, this will provide us with more LNG to sell on the spot market.”

He further noted: “Kumul Petroleum directly selling its share of the PNG LNG Project production is a significant achievement for the company and the country. We are currently in talks with other potential buyers who will be purchasing LNG shipments from us in the future.”

For the first time, KPHL is marke-

ting LNG on the ‘spot’ market from its share of product from the PNG LNG Project, not committed to long-term sales agreements.

This deal was confirmed in May to sell 144,000 cubic meters of LNG on FOB terms to PetroChina after a tender process held in February.

Prime Minister Marape recalled his meeting with PetroChina executives on March 24 in Singapore, discussing this petroleum deal, which has now successfully materialised for PNG.

Page 78 >

76 PNG BUSINESS NEWS

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OIL & GAS

Marape Cites Opportunities in Papua LNG, Wildebeest LNG Projects By: ROSELYN EREHE

P

rime Minister Hon. James Marape recently praised the economic opportunities the Papua LNG Project and the Wildebeest LNG Project are set to bring, as both natural gas projects underline the potential for business growth and development in the region.

PM Marape called on the residents of Gulf Province to prepare to supply goods and services to the forthcoming projects, emphasizing the substantial business implications and potential opportunities for investors.

He said the focus will be on local agriculture and fisheries for food supplies, forestry for timber, and tourism to accommodate the surge of workers and visitors expected, as these presented lucrative prospects for entrepreneurial ventures and investment.

During the inauguration of the Kerema District SME and Women’s Micro Bank branch on 7th May, Prime Minister Marape announced a funding of K3 million to initiate the SME project and an additional K10 million granted to the Kerema District Development Authority (DDA) to enhance the Kerema Airport, signaling government support for private sector engagement and investment.

The Prime Minister underscored the critical role of local businesses in driving economic prosperity and job creation.

Also present were Bank of PNG Governor Ms. Elizabeth Genia and her staff, Gulf Deputy Governor Hon. Morris Taudevin, Vice-Minister for Works and Highways Hon. Miki Kaeok, and other provincial and community leaders.

Prime Minister Marape disclosed the Cabinet’s decision to appoint Augustine Mano, the Managing Director of the Mineral Resources

< Page 76 He noted that with major hydrocarbon projects like Papua LNG, P’nyang, and PNG LNG, the country potentially has up to 25 trillion cubic feet (tcf) of resources to harvest.

“Having these global giant com-

78 PNG BUSINESS NEWS

Prime Minister Hon. James Marape, MP, in Kerema Town, Gulf Province, for the official launching of the Kerema District SME and Women’s Micro Bank. PM Hon. James Marape was greeted by the Kerema MP, Hon. Thomas Opa and his official delegation. -image provided by T.T.M

Development Company, as the Chairman of the Gulf Provincial Health Authority (PHA).

“Papua LNG will materialize in the next two to three years,” stated PM Marape, highlighting the timeline for investment realization and urging investors to position themselves strategically to capitalize on early-stage opportunities.

He outlined the construction phases from 2026 through 2028, expressing eagerness for ExxonMobil to expand exploration at Wildebeest, which is located just north of Kerema and is potentially the largest LNG resource in the nation.

The Prime Minister called upon Gulf Governor Hon. Chris Haiveta, Kerema MP Hon. Thomas Opa, and Kikori MP Hon. Soroi Eoe to begin provincial developments in anticipation of these transformative projects.

“I envisage food from our Gulf being directly supplied to these projects,” he said.

He also noted ongoing discussions with Governor Haiveta on developing ports in strategic locations like Kerema, Ihu, Paia, and Kikori to bolster logistics, presenting potential invest-

ment opportunities in port infrastructure and associated services.

Prime Minister Marape also remarked on recent Cabinet approvals, including a contract over K150 million to pave the section from Laloki River to Brown River along the Hiritano Highway, an important connection for the region.

“The Hiritano Highway is more than a roadway; it is an economic lifeline linking Central, Gulf, and Morobe to the heart of the country and pivotal LNG projects,” he said.

Prime Minister Marape reassured the people of Kerema and the broader Gulf community of their integral role in this national development, stating, “You are not forgotten,” and highlighting the government’s commitment to inclusive growth and equitable distribution of opportunities across all regions.

The Prime Minister emphasized their support for both mothers and men to venture into MSMEs, thereby contributing to the growth of the local economy and fostering entrepreneurship and business innovation.

panies in the petroleum sector in our country demonstrates huge potential for more investment in this space into the future,” he said.

“PNG is not only going to be involved in the upstream process but eventually in the downstream arena, which will open up even more opportunities.”

He extended his thanks to KPHL, State Enterprises Minister Hon. William Duma, Petroleum Minister Hon. Jimmy Maladina, and others involved in the significant progress discussions and implementation of petroleum-related agreements for the benefit of the country.

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PNG BUSINESS NEWS 79

OIL & GAS

How SGS’s On-Site Well Services are Revolutionising Gas Production in Papua New Guinea

S

GS has emerged as a pivotal service provider in Papua New Guinea’s upstream industry, providing cutting-edge on-site well services to a major operator in 2023.

Their use of state-of-the-art high-pressure sand filtration equipment ensured a safe and efficient natural gas extraction.

SGS utilised a comprehensive high-pressure sand f iltration equipment package, featuring advanced components such as high-pressure f low lines, connections, and precision measuring equipment. Their equipment can deliver reliable natural gas extraction even in the rugged, challenging PNG terrain.

80 PNG BUSINESS NEWS

From initial job design and planning to the installation, commissioning, site supervision, equipment operation, and the delivery of thorough data reporting, their expert team oversee the project end-to-end guaranteeing seamless execution, and superior quality control. When you need to be sure, trust SGS to deliver.

SGS offers a wide range of in-house capabilities, including inspections, technical staff ing solutions, upstream services, and sampling and analytics. These diverse service offerings allow SGS to deliver a customised, unique single point of contact service to meet the specif ic needs of each project.

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SGS takes pride in their ongoing support for clients across PNG. Beyond PNG, SGS proudly continues to make its mark globally, enabling a better, safer, and more interconnected world.

Contact SGS to learn how their cutting-edge on-site well services can optimise your project’s gas production.

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PNG BUSINESS NEWS

81

OIL & GAS

PNG-Japan Partnership Strengthens with Plans for LNG Project Talks at PALM 10 By: ROSELYN EREHE

P

apua New Guinea Prime Minister Hon. James Marape has emphasized his intention to engage in discussions with Japanese Prime Minister Hon. Fumio Kishida regarding the Papua LNG project.

During a recent presentation, Prime Minister Marape expressed his desire to formally extend invitations to Japanese contractors for bidding on the construction of the project.

The announcement came as PM Marape accepted an invitation to attend the 10th Pacific Islands Leaders Meeting (PALM 10), scheduled to be held in Tokyo from July 16th to 18th, 2024, alongside Prime Minister Kishida.

During a small ceremony, Special Advisor to the Japanese Prime Minister, Mr. Hitotaka Ishihara, hand-delivered the official invitation to Prime Minister Marape.

Top on their agenda in the discussion between PM Marape and Mr Ishihara was the mutual desire for

both leaders to hold a bilateral meeting on the margins of PALM 10.

PM Marape also expressed appreciation for Japan’s ongoing support and assistance to PNG’s development efforts.

Since 1997, Japan has been hosting PALM meetings every three years, providing a platform for leaders from Pacific Island countries and regions to exchange views on regional issues.

This year’s meeting will focus on strengthening cooperative relationships and addressing common challenges, including those related to small size, land distribution, distance from major markets, and vulnerability to natural disasters and climate change.

PM Marape has accepted the invitation and looks forward to meeting Prime Minister Kishida, expressing gratitude for the opportunity to further strengthen ties between Japan and Pacific Island countries.

Representatives from the 18 Pa-

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Special Advisor to the Japanese Prime Minister, Mr. Hitotaka Ishihara, hand-delivering the official PALM 10 invitation to PNG Prime Minister, Hon. James Marape in Port Moresby. Image provided PMs Dept

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PNG BUSINESS NEWS 83

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PNG BUSINESS NEWS 85

OIL & GAS

MRDC, Twinza Execute Agreements over Pasca A Project

T

he Mineral Resources Development Company Limited (MRDC) and Twinza recently announced they have executed agreements for MRDC to acquire an up to 50% Participating Interest in Twinza’s Pasca A Project, and for both parties to cooperate in the acquisition and development of future oil and gas opportunities in Papua New Guinea.

In a statement, MRDC, Twinza Oil Limited, and Twinza Oil (PNG) Limited said they have obtained all internal approvals and executed a series of binding agreements for MRDC to take an up to 50% Participating Interest in the Pasca A Development Project.

The Agreements, including a Joint Operating Agreement, will become fully effective upon, among other conditions, receipt of PNG Independent Consumer and Competition Commission (ICCC) approval and the execution of a satisfactory Gas Agreement for the Pasca-A Project.

MRDC may purchase up to a 50% Participating Interest in Twinza’s Pasca-A Assets, with Twinza remaining the Pasca-A Project Operator, the statement added.

Commenting on the announcement, Prime Minister Hon. James Marape said: “I welcome the transaction between MRDC and Twinza to develop the Pasca A asset and to work together on a number of other exciting opportunities in the Gulf of Papua region and the country.”

“Pasca is one of our government’s priority major energy projects in PNG and we look forward to seeing MRDC and Twinza work together to develop the project for the benefit of the people of PNG,” PM Marape added.

MRDC Managing Director Augustine Mano said: “I am very pleased to announce this significant transaction which represents another important stepping stone in MRDC’s evolution towards a more engaged and active asset owner and manager.”

“We are delighted to be working with the team at Twinza and look

86 PNG BUSINESS NEWS

forward to progressing Pasca A and many other exciting opportunities in the months and years ahead.”

Twinza Executive Chairman Stephen Quantrill said: “I am very pleased to be able to announce execution of these Agreements to work and collaborate with MRDC in the development of oil and gas assets in PNG, starting with our fully appraised, ready-to-go Pasca A project in the Gulf of Papua.”

“We thank Prime Minster Marape and the government of PNG for their support and look forward to working with Augustine Mano, John Tuaim and their team at MRDC for the future success of the Pasca A Project and towards the development of other oil and gas assets in Papua New Guinea.”

“Pasca A, when operational, is expected to generate more than K500 million per year to the PNG State, generate around 500 permanent jobs and bring significant US Dollars of foreign currency into the PNG economy. Twinza stands ready to proceed with Pasca Phase 1 FEED as soon as the Pasca Gas Agreement is executed and the Project Development Licence is awarded.”

The Pasca A Development Project is a large FEED-ready off-

shore project in the Gulf of Papua.

Twinza, 100% owner of the Project, applied for the Petroleum Development Licence (PDL) in June 2015, has complied with all Government requests and has been steadily advancing the project while negotiating the Gas Agreement since 2020.

The Pasca A field is fully appraised with four wells having been drilled in the field, resources independently assessed by Gaffney, Cline & Associates, pre-FEED studies completed, and the project will enter FEED following the approval of the Pasca Gas Agreement.

Twinza has to-date invested over K400 million in the Project in anticipation of permitting and fiscal certainty and continues to work diligently on the Project.

In 2023 the company announced a 35% increase in total resource size (almost doubling the benefits of the project to the State) and validated Carbon Dioxide sequestration potential of 200 million tonnes of CO2 making it potentially the first carbon negative hydrocarbon project in PNG. The project is expected to contribute over K30 Billion to Papua New Guinea’s economy and K15 Billion revenue to the country over its life.

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PNG BUSINESS NEWS 87

AGRICULTURE

PNG, China Sign Historic Agreement for Coffee Industry By: ROSELYN EREHE

T

he recent signing of the Protocol on coffee exports to China during the official visit of His Excellency Wang Yi, the Minister for Foreign Affairs for China, marks a significant milestone for Papua New Guinea’s coffee industry and agriculture sector.

The momentous occasion on the 21st of April signifies an historic moment in the relationship between PNG and the People’s Republic of China, as the phytosanitary protocols were signed to open the Chinese market to PNG’s unroasted coffee beans.

It reflects years of negotiation efforts

by PNG Prime Minister Hon. James Marape and Minister for Foreign Affairs, Hon. Justin Tkatchencko, aimed at bridging the gap between the two nations’ systems.

Traditionally, PNG’s coffee has been primarily traded with Western societies, with Asia serving as the shipment port.

However, with the efforts from Prime Minister Marape to promote and develop the agriculture sector, the Memorandum of Understanding (MOU) with China heralds a promising future of trade and economic partnership between the two nations.

PNG boasts a global reputation for its distinct coffee, with exports reaching over 34 countries worldwide.

Despite producing less than 1 million green bean bags annually, PNG’s presence in various markets underscores the unique position its coffee holds among enthusiasts globally.

PNG Minister for Coffee, Hon. William Bando, CPA, LM, MP, in a recent statement, assured his Ministry’s commitment in supporting the coffee industry.

“My Ministry will work to enhance the entire coffee value chain, from farm to cup, by investing in infrastructure, technology, and capacity-building initiatives that improve productivity, quality, and market access for coffee farmers,” Hon. Bando said.

From 2021 to 2023, PNG has witnessed remarkable growth in its coffee export sector, particularly in exporting to China. The cumulative value of coffee exported saw over 50,651 bags (3,039 tonnes) shipped to China,

88 PNG BUSINESS NEWS

PNG Minister for Coffee, Hon. William Bando, CPA, LM, MP

bringing in an impressive K42,104,493 -- reflecting the dedication of local farmers and exporters.

“This achievement is a testament to the hard work of our local farmers and exporters, where 58% out of the 32 registered exporters have ventured into the Chinese market, diversifying and expanding their horizons,” Minister Bando said.

The surge in exports to China, reaching 35,020 bags (2,101 tonnes) in 2023 alone, demonstrates the increasing demand for PNG coffee in China, attributed to the unique taste and high quality of PNG coffee, making it a preferred choice among the Chinese.

Minister Bando confirmed that the figures presented relates to PNG coffee entering China, not directly but through different ports such as Hong Kong, Malaysia, or Singapore, as PNG had no protocols for direct entry of coffee. It will be another chapter when coffee can be now shipped direct to China.

He stated the challenges the PNG coffee industry faces, adding: “The signing opens up market for our products, but it is a challenge to our coffee industry to produce more as direct exports will obviously mean more direct sourcing of PNG Coffee.”

“Further, we can expand our roast and ground coffee trade with the direct flights between PNG and China that is expected to be three flights weekly.

We need to put more roast beans and ground coffee on these flights to China apart from the unroasted or green

bean exports on ships.”

He said efforts will be directed towards enhancing the entire coffee value chain, from farm to cup, through investment in infrastructure, technology, and capacity-building initiatives.

Research and innovation will play a crucial role in driving growth and competitiveness in the coffee sector, the minister added.

PNG also seeks to explore trading opportunities with China for other commodities such as cocoa, rubber, coconut, copra, tea, and oil palm, emphasizing the commitment to agricultural development.

However, the minister said the success of this agreement hinges on the continued dedication of farmers, growers, and industry stakeholders to increase production and productivity while maintaining the unique taste and preferences that distinguish Papua New Guinea coffee on the global stage.

Hon. Bando added: “My appeal to all Coffee Industry Corporation Board and staff and Agriculture Officers throughout PNG to get moving on the ground to motivate, encourage and point our producers to getting our hands dirty and this will create employment and income earning opportunities and in moving our industry forward as well as our economy. We must produce more coffee and process at affordable costs for our own consumption and to sell to the world that unique PNG brand.”

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PNG BUSINESS NEWS 89

AGRICULTURE

AgResearch Keen to Partner with NARI

A

gResearch is keen and ready to partner the National Agriculture Research Institute (NARI) of Papua New Guinea (PNG) to help develop the agriculture sector of PNG. AgResearch is one the seven Crown Research Institutes in New Zealand responsible for delivering innovative science and research outcomes specifically for the agricultural sector.

In their meeting with the Minister for International Trade and Investment, Hon. Richard Maru in Hamilton, New Zealand, AgResearch said they were happy to partner NARI to provide research training and internships for Papua New Guinea agriculture scientists

and graduates.

Minister Maru said: “AgResearch has been providing training internships routinely through similar arrangements with their partners and they are keen to do the same with PNG through a partnership with NARI. They are happy to work with the PNG Government and NARI to formalize this partnership.”

Minister Maru further stated: “We want to build our dairy industry to become a dairy producing nation, but we have no expertise. New Zealand has all the expertise and experience and are renowned globally in this space and that is why we want our agriculture scientists and graduates to come to AgResearch to be trained so they can learn from

them and return to PNG to build our own industry.”

“This will be the start of our journey to building a serious agriculture relationship with New Zealand,” Minister Maru added.

PM Announces Enactment of New Forestry Laws to Maximise Resource Value

P

rime Minister Hon. James Marape has announced that the forestry sector has enacted two new laws to ensure the country gets maximum value from its forestry resources.

The laws, relating to the State Marketing Agency (SMA) and Purchase Option (PO), are among several initiatives that the PNG National Forestry Authority has undertaken during the last five years under the Marape Government.

These laws aim to ensure that the resource owners – the people who own the land on which the trees are being harvested for export – receive greater benefits from their resources while contributing more to the country’s revenue, particularly through downstream processing.

Prime Minister Marape highlighted these laws in a five-year anniversary report of his government presented to Parliament recently.

“In forestry, we have enacted laws that will establish the State Marketing Agency (SMA) and Purchase Option (PO) to buy logs from permitted operators. This cuts down on other unfair trade practices, especially transfer pricing and tax

90 PNG BUSINESS NEWS

evasion. Downstream processing is the end game out of all of this,” he said in the report.

Despite the forestry industry making an important contribution to PNG’s economy for many years, it has faced numerous criticisms, prompting the industry to take significant steps to improve its image for the benefit of the country.

Currently, most timber produced in the country and exported is in the form of raw logs – a trend the Marape Government seeks to change by promoting downstream processing, thereby exporting finished products that fetch higher prices than raw materials, ultimately contributing to the country’s overall economic

improvement.

The Prime Minister acknowledged the economic challenges facing the people and assured them that his government is making every effort to turn the tide, including enacting laws in the forestry sector to ensure progress and positive changes in the economy, though major improvements will take time.

“What we have done is foundational. Its impact will come given time.

We’re dealing with issues in totality, not haphazardly, to achieve one outcome,” Prime Minister Marape said.

“We’re laying down strong building blocks under difficult circumstances. We inherited an economy that was managed poorly.”

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PNG BUSINESS NEWS

91

TOURISM

China Ready Workshop: Unlocking PNG’s Tourism Potential By: ROSELYN EREHE

P

apua New Guinea Minister of Tourism, Arts and Culture, Hon. Isi Henry Leonard, recently welcomed distinguished guests from China, PNG, and stakeholders for the first China Ready Workshop held on the 25th April at APEC House-Port Moresby.

“Your presence here signifies our vision for a vibrant future in tourism and business between Port Moresby-PNG and China,” Minister Leonard said in his opening remarks.

China Ready is a global accreditation system that certifies a product or service that can be trusted by a Chinese consumer. This internationally recognized system is being rolled out in PNG’s capital among affiliated members of the tourism industry.

PNG is the 51st country across six continents to adopt this program, representing 25 percent of global destinations.

The workshop is organized by the PNG Tourism Promotion Authority (PNGTPA) and the National Capital District (NCD) Governor’s Office in close partnership with the Government of China.

It is an exclusive event, initiated to prepare Port Moresby’s tourism industry and its stakeholders for the opportunities the Chinese market offers.

The workshop included the latest market updates, insights into the post-COVID-19 Chinese traveler, effective strategies to take on the fast-evolving Chinese market and tap into its vast potential.

Areas ranging from transportation and accommodation to entertainment and services highlight the diverse opportunities awaiting the city, as the government and stakeholders prepare to welcome Chinese tourists.

Participants gained valuable knowledge on post-COVID Chinese tourist demographers, behavioral changes, the rising trend of Free Independent Travellers, effective communication strategies with Chinese partners, destination selection criteria, target strategies for Chinese travellers, and marketing PNG’s unique culture and natural beauty.

Participants in the workshop included: • Government officials from tourism departments and ministries • Cultural organizations and heritage sites representatives • Local tourist boards and associations • Hotels and accommodation representatives

92 PNG BUSINESS NEWS

• Tour operators and travel agencies • Transportation providers (airlines, railways, bus companies) • Restaurant and food services businesses • Attractions and touristic sites management • Retailers and souvenir shops • Tourist guides • Emergency services and healthcare providers • Agencies for safety and security briefing • Marketing and public relations professionals for destination promotion • Hospitality training institutes and professionals for service improvement.

In his speech, Hon. Leonard said: “We will work closely with our stakeholders to enhance Port Moresby’s image, correct misconceptions, and strengthen our ties with Guangdong Province.”

“It is time that PNG joins other Pacific nations that have benefited through this China Ready approach. it is evident in their success stories of countries like Samoa, which has experienced significant increase in Chinese visitation numbers and tourism growth after adopting the China Ready principles.

“Let us seize this opportunity to build strong partnerships, enhance our city’s appeal, and pave the way for sustainable growth and mutual prosperity.”

More than 60 participants got certified, including air service providers, car rental companies, clothing retail outlets, and received their certificates after completing the China Ready workshop.

NCD Governor Hon. Powes Parkop reiterated the significance of making Port Moresby and PNG China Ready “to tap into and harness this potential of tourism.”

“The National Government through the Minister adopted the strategic plan and now it’s up to all of us to roll the strategy out. We must recognize and understand that tourism is a sleeping giant,” he said.

Hon. Powes emphasized the products of tourism that PNG can offer. Port Moresby, as the nation’s capital, is a hub of more than a thousand tribes and cultures, a diverse country that is rich with language.

PNG owns one-third of the world’s rainforest, which is a tourist product in itself, he added.

The China Ready Workshop follows the recent establishment of direct f lights from Guangzhou, China to Port Moresby by China Southern Airlines, fueling the expected increase in tourism in the coming months.

PNGTPA’s CEO Mr. Eric Mossman Uvovo described the initiative as a historical milestone for the country, “where we position ourselves to welcome one of the biggest economies in the world in terms of tourism.

The workshop was a pivotal moment for stakeholders and all of us to be ready for the outbound Chinese Market.”

The China Ready Program was established in 2002 and is the largest of its kind, ensuring destinations and service providers meet Chinese hospitality standards. It is operated by CBISN and exclusively issued by the China Outbound Tourism Research Academy (COTA). The program is endorsed by the Chinese Ministry of Culture and Tourism.

Dr. Marcus Lee, CEO of China Travel Online and facilitator for the China Ready workshop, provided insights into the program’s objectives.

“Our primary objective is to enable Papua New Guinea to tap into the vast potential of the Chinese market. We’ve completed our audit, and the essence of the China Ready concept is to guide destinations and stakeholders on welcoming Chinese tourists.

More importantly, it’s about delivering services and products that meet Chinese standards,” said Lee. Lee encouraged the government to work closely with PNGTPA to make PNG China Ready. “I urge all stakeholders, including the government and PNGTPA, to implement the Insights gained to make Port Moresby and PNG truly China Ready,” he said.

Lee is CEO of China Travel Online, a leading China Outbound Travel portal on the China-wide web with over 100 destinations listed. The group consists of Technology, Media, and MICE, with officers across 10 countries in Asia and China. The portal reaches 80% of the Chinese outbound travel trade.

He sits on board as Chairman of China SME Business Owners Association (ICIF) with 11,000 corporate members. Marcus speak 6 Chinese languages and is the author of the international bestseller “How to Outsmart China” featured by CNN, China Daily and Bloomberg.

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PNG BUSINESS NEWS 93

TOURISM

Belt Again Beach Resort: A Gateway to Serenity and Cultural Riches

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alomarubu village, along the Rigo coast nestled in the Rigo District of Central Province, lies an estimated 113 kilometers from bustling Port Moresby. Here, Esau Lui, the Owner and Director of Belt Again Beach Resort, brings to life his vision of a coastal haven where guests can escape urban hustle and reconnect with nature and culture.

Lui’s roots run deep in the Central Province, specifically the Rigo district, and it’s on the shores of his village that his dream takes shape. With a passion for hospitality and a desire to showcase his heritage, Lui embarked on the journey of building Belt Again Beach Resort in 2023.

The resort takes its name from the land it is built on, ‘Kwari wai’ in the native dialect, which means Belt Again. Now, a year and two months into construction, the resort stands as a beacon of local pride and opportunity.

Employing local villagers in various roles, from carpenters, electricians, plumbers, security guards, drivers to chefs, Lui not only fosters economic growth but also preserves traditional craftsmanship and culinary practices.

Esau Lui in an interview with PNG Business News confirmed his employees where qualify in their respective professions delivering their services accordingly, “I told them, if we can build resources for other people, why not come together and we build for ourselves.” He added.

He stated the importance of exposing such locations as tourist destinations, to the international community and the country as a whole.

The resort’s commitment to sourcing produce from nearby villages not only supports local economies but also enriches guests’ dining experiences with authentic flavors.

As the resort nears completion, its offerings promise an escape like no other. From comfortable accommodations to beachfront bungalows, and from tantalizing dining options to a plethora of activities, Belt Again Beach Resort plans to cater for guests’ preferences. Whether guests seek relaxation or cultural immersion or simply a moment of tranquility, the resort aims to deliver.

Central to the resort’s allure is its

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stunning jetty, stretching 210 meters from the rooms to the sea-view bar. By day, it offers a scenic pathway to the open sea, while by night, it transforms into a captivating spectacle, illuminated against the darkened waters.

Lui’s aspirations extend beyond mere hospitality; he envisions Belt Again Beach Resort as a catalyst for community development and cultural exchange. By involving nearby villages in Small and Medium Enterprises (SME) sales and tourism initiatives, he hopes to foster sustainable growth and empower local communities, including villages stretching by the coastline of Central Province.

With a team of 37 skilled workers from diverse backgrounds, Lui’s dedication to his vision is evident. These individuals are not just employees but partners in realizing a shared dream of prosperity and pride.

As the resort’s opening draws near, Lui reflects on the journey that brought him here—a journey rooted in childhood memories and fueled by a determination to give back to his community.

Belt Again Beach Resort stands as a testament to Lui’s unwavering commitment and the rich history of its location.

“This location is special to me, when I was a child, my parents will bring me here. We had our gardens nearby, our coconut tress too. Growing up, I had

a vision; to do something in this place.

Today what you see is the reality of what I dreamt of building years ago.”

“To bring back something, as an aspiring leader, this resort creates employment opportunities for locals and nearby villagers as well.”

“Imagine if we start having tourists, we can involve and have villages and communities to participate in SME sales here.” He added.

Beyond its idyllic setting lies a legacy century in the making. Once a vital stop for seafaring travelers, Kwariwai Beach Point now emerges as a modern-day sanctuary, welcoming visitors and guests from near and far to experience its beauty and local hospitality.

As the finishing touches are put in place, Belt Again Beach Resort awaits its grand unveiling for the months to come. Esau’s efforts shine through the well-built tropical escape taking shape.

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PNG BUSINESS NEWS 95

TOURISM

PNG Tourism Showcased in Fiji Tourism Expo By: ROSELYN EREHE

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he Papua New Guinea Tourism Promotion Authority (TPA) recently highlighted PNG tourism at the South Pacif ic Tourism Exchange (SPTE) held from May 4 to 5 in Nadi, Fiji.

With a team of eight TPA representatives in attendance, the event aimed to support tourism connections and spotlight PNG’s diverse attractions to a global audience.

Organised by the Pacif ic Tourism Organisation (PTO), formerly the South Pacif ic Tourism Organisation (SPTO), SPTE stands as a pivotal trade showcase for Pacif ic Island nations’ tourism of ferings to international buyers from key markets.

SPTE markets, promotes, and develops tourism in the Pacif ic Region. It provides a signif icant opportunity for PNG’s local tour operators, hoteliers, airlines and travel logistics to engage directly with international buyers, building their networking and conducting business.

TPA’s robust presence underscored PNG’s commitment to the PTO and its tourism-related objectives.

Eric Mossman Uvovo, TPA’s Chief Executive Of f icer, emphasized the signif icance of active participation, citing SPTE as a premier avenue to spotlight PNG’s natural beauty, cultural richness, and unique experiences to potential visitors.

Mr Uvovo said: “Active participation in the South Pacif ic Tourism Exchange, organized

by PTO, serves as a premier platform to showcase our nation’s tourism attractions to international buyers from key markets.”

“The face-to-face meetings facilitated at SPTE will allow us to ef fectively promote PNG as an iconic tourist destination, renowned for our pristine landscapes, rich cultural heritage, and unique experiences. It’s a chance for us to showcase the best of what our country has to of fer.”

TPA’s involvement aligned with its overarching goal of cultivating

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partnerships within the tourism and hospitality sector. Uvovo reiterated the importance of PNG’s presence at global tourism events in enhancing the country’s reputation as a top-tier tourism destination.

“Through initiatives like SPTE, we continue to position ourselves as a leading destination for travellers seeking authentic experiences in the South Pacif ic.”

“Events like SPTE solidify our position as a premier destination for travelers seeking authentic experiences in the South Pacif ic,” he added.

With a focus on building lasting relationships and exploring avenues for future growth, TPA’s active involvement in SPTE signals a concerted ef fort to elevate PNG’s tourism industry on the global stage.

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PNG BUSINESS NEWS 97

TOURISM

PTO Partners with PNG Tourism to Drive Data Excellence

By: ROSELYN EREHE

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o strengthen sustainable tourism development across the Pacific region, the South Pacific Tourism Organisation (SPTO) joined with the Papua New Guinea Tourism Promotion Authority (PNGTPA) for a pivotal collaboration.

The highlight of this partnership was a weeklong in-country workshop held May 13 to 17, focusing on data initiatives and the Digital Measurement and Benchmarking Dashboard under the Pacific Digital Transformation Project (PDTP).

The project focuses on collecting and analyzing tourism data to make informed decisions for sustainable tourism development.

The New Zealand Government-funded Pacific Tourism Data Initiative (PTDI) project supported this partnership.

The PTDI project supports evidence-based planning and decision-making.

Its components include the creation of a bi-annual International Visitor Survey (IVS), an annual Business Confidence Index (BCI), and an annual Community Attitude Survey (CAS) report.

These reports offer crucial insights into community awareness and attitudes toward tourism.

The workshop, held at the Citi Boutique Hotel in Port Moresby, drew the participation of 15 individuals equipped with the tools necessary to drive insightful research outcomes within PNG’s tourism sector.

At the workshop, PNGTPA’s Executive Manager for the Corporate Affairs Division, Claire Kupo, underscored the pivotal role of data and research in shaping informed decisions and public policies conducive to sustainable tourism development in the region.

PNGTPA’s CEO, Eric Mossman Uvovo, reiterated the significance of the collaboration with SPTO on initiatives like the Pacific Tourism Data Initiative (PTDI) project.

Mossman Uvovo said: “The recent week-long in-country workshop focused on data initiatives and the Digital Measurement and Benchmarking Dashboard shows the importance of collecting and analyzing tourism data for informed decision-making.”

“By working together with SPTO and other stakeholders, we are com-

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mitted to using data-driven insights to drive sustainable tourism development in Papua New Guinea and across the Pacific region. Through initiatives like the PTDI project, we aim to enhance our understanding of visitor behavior, preferences, and trends, ultimately shaping a vibrant future for tourism in our country and the region,” he added.

SPTO Chief Executive Officer, Christopher Cocker, also stressed the importance of weaving together the power of data to contribute to informed decision-making and shape a sustainable and vibrant future for tourism in the Pacific.

“SPTO has been very fortunate to conduct an in-country visit to PNG to enhance the proficiency of research officers in utilising statistical analysis software (Survey Monkey, SPSS & NVIVO) through funding from the New Zealand government,” Mr. Cocker said.

“The workshop is pivotal for driving insightful research outcomes within the PNG tourism sector and data collaboration is key within the Tourism Industry Stakeholders in the implementation of the Digital Measurement and Benchmarking Dashboard.”

A participant, PNGTPA Research and Statistics Officer Abigail Pangwinyen, lauded the four-day workshop for enhancing her skills in data analysis

within the travel and tourism industry.

Through conducting workshops and fostering collaborations with local partners, SPTO reaffirms its dedication to advancing sustainable tourism development in both PNG and the broader Pacific region.

The PTDI project, funded by the New Zealand Government, encompasses ten countries -- PNG including Niue, Cook Islands, Samoa, Solomon Islands, Vanuatu, Tonga, Kiribati, Timor Leste, and FSM-Yap. It aims to collect and analyze tourism data crucial for evidence-based planning and decision-making, thus shaping a vibrant future for tourism in the Pacific.

The SPTO is the mandated organisation representing Tourism in the region, established in 1983 as the Tourism Council of the South Pacific.

It has 21 Government members -American Samoa, Cook Islands, Federated States of Micronesia, Fiji, French Polynesia, Kiribati, Nauru, Marshall Islands, New Caledonia, Niue, Papua New Guinea, Rapa Nui, Samoa, Solomon Islands, Timor Leste, Tokelau, Tonga, Tuvalu, Vanuatu, Wallis and Futuna, and the People’s Republic of China.

In addition to government members, the SPTO has a broad private-sector membership base.

Standing from left to right: PTO’s Research & Statistics Manager, Prashil Parkas, TPA’s Research Officer for Domestic, Abigail Pangwinyen, PNG Air’s Marketing and Media Coordinator, Dalai Thomas, TPA’s Senior Partnerships & Industry Liaison Officer, Clare Atava, TPA’s Planning and Project Officer, Murray Variambu, Leo Ameua from the Central Provincial Office, TPA’s Data Analyst, Jephet Keako, PTO’s Senior Research Officer, Rovarovaivalu Vesikula, TPA’s Policy Analyst, Faith Kaupa and Air Niugini’s Executive Manager for Sales and Distribution, Floyd Smith.

Seated from left to right: Executive manager for PNGTIA, Joybertina Piasinu, Lucy Miro from Kokoda Track Authority, Lavinia Fine Naivalurua from SPTO, Henna Esela from POM Business College, Imelda Atu from UPNG and Monalisa Kamuri from POM Business College during the conclusion of the workshop in Port Moresby. - Image provided by TPA PR.

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PNG BUSINESS NEWS 99

FINANCE

IRC Launches New Debt, Lodgment Letters For Streamlining Taxpayer Communication By: ROSELYN EREHE

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he Internal Revenue Commission (IRC) unveiled its revamped debt allotment letters, signaling a significant step towards clearer communication with taxpayers and tax agents.

This is in line with IRC’s desire to communicate with taxpayers and tax agents through one of their projects a part of the broader Taxpayer Services Strategy to foster voluntary compliance.

IRC wants to make sure they are as clear as possible, with all their interactions, so that taxpayers and tax agents understand their obligations and the consequences of non-compliance. By delivering messages clearly, there is less room for misunderstanding.

The launch event, held on May 15th at the Revenue Haus - Downtown, Port Moresby, was attended by prominent figures from both the IRC and Australian Taxation Office (ATO) coming together to celebrate the culmination of months of diligent work. ATO has supported IRC in this important work.

These new letters convey the same messages and have the same demands as the old letters – the content is not new, but the look and feel are.

Commissioner of Taxation, Mr. Samuel Loi, said, “The launching of the Letters achieves the 2023 IRC corporate plan to make voluntary compliance easier for our taxpayers or foster voluntary compliance, which is one of the pillars in the IRC’s Corporate Plan.

“Under the Taxpayer Services Strategy, the New Improved Letters Project developed by the Debt Collection Operations Team with the assistance of our ATO partners has made it simple and easy for Taxpayers to understand.”

This batch of letters includes: • lodgment and payment reminders and requests, • garnishee notices • departure prohibition orders • payment agreement notifications certificate of compliance communications • GST and SWT application notifications • and audit notifications.

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(left to right) IRC DCOD Director, Mrs. Kaia Fabila, IRC Commissioner General Mr Sam Koim and ATO Director Sally Bird, cutting the ribbon, officially launching the new Lodgment Letters at the Revenue Haus, Port Moresby.

- Image Provided IRC

Despite their modern appearance, these letters retain the IRC logo.

Recipients are advised to note that these letters are legitimate communications from the IRC, not scams. The importance to read and understand the requirements outlined in the letter and take necessary actions promptly is adviced.

IRC Commissioner General Mr Sam Koim OBE, in his address, underscored the importance of providing comprehensive information to taxpayers, emphasizing the need for clear reasoning behind adverse decisions.

“When I came to the IRC and I saw a couple of letters that were written, generic ones that were sent to text phase, text phase were constantly asking why am I sending this letter.

Sometimes they told me and I tried to even make a sense out of it.”

“If you are taking an adverse decision against the text phase, you’ve got to give the reasons. And then also cite where they have defaulted and the law that was breached. So, insufficient information was provided and that’s where this project is initiated to at least draft templates for clear information.”

Koim also highlighted the IRC’s commitment to supporting taxpayers in financial distress, emphasizing the availability of structured payment plans tailored to individual cash flows. This proactive approach aims to alleviate the burden on taxpayers and encourage compliance.

He added, “We encourage tax agents to talk to your taxpayers about the new letters. They need to take notice of the requirements in the letters and take action accordingly.”

Commissioner General Sam Koim, underlined this commitment, highlighting the significant role of the new letters in facilitating easier understanding of tax obligations.

IRC DCOD Director, Mrs. Kaia Fabila, delivering the keynote speech, reiterated the overarching objective of the project to foster voluntary compliance through enhanced clarity and transparency.

She emphasized that while the content of the letters remains consistent with previous versions, the redesigned format aims to improve readability and comprehension.

The project’s success owes much to the collaborative efforts of internal and external stakeholders, including feedback from tax agents.

“There has been a lot involved in this project to get to where we are today. The entire debt and lodgment suite of letters has been reviewed and rewritten. There has been internal and external stakeholder management and thank you to the tax agents in the room who have provided feedback,” Ms. Fabila reiterated.

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FINANCE

ting and space, all leading to greater taxpayer and tax agent understanding of their obligation.

Colour coding themes corresponds as follows: • Green themed letters for general or positive correspondence • Orange themed letters for early collections correspondence • Red themed letters for firmer action correspondence “I am excited to see the impact that these new, improved debt and lodgement letters will have on our organization and our wider commu-

nity,” she added.

A significant aspect of the overhaul is the reduction in the number of templates, from 54 debts and lodgement templates to approximately 33 templates, achieved through the implementation of variable-based templates. This streamlining not only simplifies the process for taxpayers but also enhances efficiency for IRC staff.

The launch ceremony culminated in the unveiling of the new letters, symbolizing a significant milestone in the IRC’s journey towards modernization and efficiency. With

the renewed collaboration between IRC and ATO, as underscored by a recent memorandum of understanding, stakeholders can look forward to further advancements in taxpayer services.

As the IRC embraces its new look and branding, marked by user-centric communication and streamlined processes, it reaffirms its commitment to becoming a robust and efficient tax administration. The launch of the new debt allotment letters indicates a new era of clarity, transparency, and cooperation in tax compliance.

Bank of Papua New Guinea Governor Opens Fifth Women’s Micro Bank Branch in Kerema

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overnor of the Bank of Papua New Guinea Ms. Elizabeth Genia has officially opened the Women’s Micro Bank (WMB) Branch in Kerema, making it the fifth WMB branch to be operating in Papua New Guinea.

“Today’s official opening of its fifth branch celebrates another achievement in a long line of achievements we have seen for women’s microbank,” Ms. Genia told the people of Kerema town who turned up in hundreds to witness the important occasion.

“I am sure your highly esteemed founder, the late Janet Sape, would have been extremely proud of the organization affectionately known as Mama Bank, now one of the top 50 companies for women in APEC countries and well regarded as a financial services innovator.”

Ms. Genia stated that WMB has become a key driver of financial inclusion and financial inclusion was originally a BPNG led innovation but is now a national strategic priority.

She applauded women’s micro bank services in addressing several financial inclusion objectives, particularly highlighting depositing taking and lending opportunities to the 85% of the population who are still unbanked.

“Opening of the Kerema branch is another way Women’s Microbank has made a commitment to encouraging people to access financial

services,” she said.

“I understand the Kerema branch will enable the people of the district, particularly the women, to take advantage of services such as the MSC credit scheme, financial literacy training, as well as basics, including deposit takings and loans.

“The branch will provide a practical and desirable alternative to the risks of holding cash, informal money lending and money scams, all of which stop people from building a comfortable standard of living.”

“Today’s official opening gives members of the community the opportunity to take significant steps forward towards building the financial security and financial independence,” the BPNG Governor said.

Coinciding with the opening, was also the launching of the Kerema District SME Policy which was officially launched by Papua New Guinea Prime Minister Honourable James Marape.

The Prime Minister committed three million kina towards the WMB Kerema branch as part of the Government’s partnership with KDDA in assisting to create a credit lending facility where Gulf women especially mothers in SME can benefit.

“Get into productive micro to small medium enterprises and do well for yourself. By doing well for yourself, you will be preparing your

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children well for the future,” the prime minister encouraged women from Gulf province.

Kerema Open MP Honourable Thomas Opa also committed two million kina towards the WMB Kerema branch and also became the first customer to open an account with the branch.

Mr. Opa emphasised that empowering women in Gulf province was a big challenge. But with the setting up of a WNB (mama) branch in his province and assistance from the government with seed capital to fund lending credit facilities, he was confident mothers and young girls will take advantage of the opportunity, use the facilities wisely to venture in various business opportunities, and empower themselves financially.

Other important delegates who witnessed the SME Policy Launching and WMB opening included, Kerema Open MP and Vice Minister for Petroleum and Energy Honourable Thomas Opa, Wapenamanda Open MP and Vice Minister for Works and Highways Honourable Mikki Kaeok, Moresby North West Open MP Lohia Boe Samuel, BPNG Assistant Governor George Awap, WMB CEO Gunanidhi Das, CEFI Executive Director Saliya Ranasinghe and members of the Kerema District Development Authority and the Gulf Provincial Executive Council.

PNG BUSINESS NEWS 101

FINANCE

Kina Monitored: Economic Potential to Increase Currency’s Value By: ROSELYN EREHE

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ith a focus on infrastructure development and a rising middle-class market, including Small and Medium Enterprises (SMEs), Papua New Guinea presents a promising landscape for investors.

PNG’s abundant natural resources in mining, oil and gas, forestry, fisheries, and agriculture further enhance its appeal. From coffee and cocoa to vanilla and local produce for imports, the country’s diverse agricultural sector adds depth to its economic profile.

However, amidst this potential, discussions around the fluctuation of the PNG Kina have been prevalent.

Prime Minister Hon. James Marape acknowledges this concern and assures that the Department of Treasury and Central Bank are diligently monitoring the situation to prevent any extraordinary inflation.

This was his response to a report by ANZ Bank foreign exchange insight researchers, economists Kishti Sen and Tom Kenny, published in the media on 7th May, on the depreciation of the Kina since May 2023.

He attributes the Kina’s depreciation to its artificial pegging in 2014, a measure taken to maintain its value, which ultimately became unsustainable. With the peg now removed, the government is keen on ensuring a stable currency value aligned with market dynamics.

PM Marape said, “The Kina was artificially pegged in 2014, probably with good intentions to maintain its value. But, over time, it became a demotivation for importers to bring back their export earnings as the Kina became more expensive and not on its fair market value.

“We have now unpegged it, and Treasury and Central Bank are observing closely to ensure the depreciation of the Kina does not trigger extraordinary inflation over our 2024 inflation focus.

If it does, we will intervene.”

Prime Minister Marape emphasizes the importance of encouraging exporters to repatriate their earnings, thereby supporting the Kina’s value.

By collaborating with entities across agriculture, fisheries, forestry, mining, and petroleum sectors, the government aims to facilitate a conducive environment for economic growth and

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to streamline processes for investors, particularly in US Dollar accounts and funds.

“A lower Kina means more for these people when they bring in their dollars.

This will assist push the Kina upwards purely on market value.”

“Last year, we made well over K60 billion in exports, but the return to our economy was much less. If all our exporters brought back to PNG a major portion of earnings, if not all, then the Kina will appreciate.”

“We are working on tidying this, and Central Bank has been asked to look at ease of investors holding US Dollar accounts and for ease of them accessing their own funds.”

The Marape government’s agenda revolves around stimulating largescale investments and trade, with a strategic focus on reducing dependency on imports through increased manufacturing and downstream processing.

Ongoing reforms target high debt levels, while Foreign Direct Investment (FDI) in natural resources promises to revive the economy for years to come.

Acknowledging the contributions of key partners such as Barrick Gold and ongoing projects by major players like ExxonMobil, TotalEnergies, and Santos, the government remains committed to fostering an environment conducive to investment.

“On that note, I want to appreciate Barrick Gold – our partners in New Porgera – for their commitment to remit a minimum of 51 percent of earnings from Porgera,” said PM Marape.

The Prime Minister said Government has been working with investors to bring in capital from Foreign Direct Investment in both exploration and construction, while work is continuing to get the next mining and gas projects up and running.

“ExxonMobil, TotalEnergies and Santos each have over $100 million exploration programs running this year; they will also maintain spending in pre-Papua LNG FID.” Projects such as the Pasca condensate project and the Wafi-Golpu mine underscore PNG’s potential as a significant player in the market.

“We are progressing the small Pasca

condensate project that would be 50 percent owned by MRDC for Gulf and 50 percent owned by investors. By this year SML for Wafi-Golpu should be issued to kick start construction.”

“All these FDI are for this year and next year, as we head to meet the big construction of Papua LNG, and later P’nyang LNG and Wafi Golpu mine,” he said, adding that PNG’s agriculture, forestry and fisheries exports have been steadily improving which would assist boost the Kina.

He said if any urgent needs arose out of this current situation, Government would make interventions to families, businesses and investors, as it has continuously done over the last couple of years.

“Our government is on record for giving the biggest relief assistance to support the economy and our people’s livelihoods in re-moving taxes for certain work bracket and paying more in school fees. We will continue to intervene.”

The Prime Minister said for the long-term address of foreign exchange and other structural issues in the PNG economy, allowing the Kina to float on its own strength was bound to happen.

“I want to assure everyone that we are conscious of the domestic impact of a depreciated Kina, especially its effects on our small, import dependent economy. I do not want the burden of this to be passed onto store shelves to affect our people further, so we are keeping a very close watch,” said Prime Minister Marape.

In addressing structural issues, PM Marape emphasizes the need for a longterm solution, allowing the Kina to float based on its inherent strength.

While mindful of the challenges posed by a depreciated currency, the government remains steadfast in its commitment to supporting businesses and safeguarding livelihoods.

The PNG government’s focus on creating a conducive socio-economic environment highlights its dedication to fostering growth. By prioritizing infrastructure development, safety and security measures, regulatory practices, governance, and access to health and education, the Marape government aims to lay the foundation for a resilient and thriving economy.

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PNG BUSINESS NEWS 103

FINANCE

Green Finance Talk: New Zealand Ministerial Delegation Visits BPNG By: ROSELYN EREHE

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he Bank of Papua New Guinea (BPNG) welcomed a distinguished ministerial delegation from New Zealand to discuss the progress and initiatives of the Green Finance Centre (GFC) in the context of climate resilience in Papua New Guinea.

The meeting, held on May 13, underscored the pivotal role of green finance in addressing climate change challenges facing the island nation.

The round table discussion facilitated an exchange of insights among officials from the New Zealand Ministerial Delegation, BPNG, the Climate Change Development Authority (CCDA), and the Global Green Growth Institute (GGGI).

Led by the New Zealand Minister of Climate Change, Hon. Simon Watt, MP, the NZ delegation commended the BPNG for its leadership in establishing foundational structures for green finance in PNG noting that the Central Bank can be proud of this.

Hon. Watts emphasized that climate change is fundamentally an economic issue. He added that New Zealand, which is also advancing its Green Taxonomy, is eager to assist the Green Finance Centre in harmonizing its Inclusive Green Taxonomy.

“The New Zealand Government is impressed with the Bank of Papua New Guinea’s approach to creating a resilient and stable financial system,” Hon. Watts stated.

He expressed New Zealand’s interest in collaborating with like-minded countries in the green finance sector, noting that both countries experience the impact of climate events with similar intensity, thereby presenting mutual opportunities for assistance in adaptation and mitigation efforts.

PNG, being an island nation, faces heightened vulnerability to climate crises such as f loods, droughts, rising sea levels, and strong winds. The collaboration between the New Zealand government and BPNG aims to address these challenges by integrating green finance policies into the country’s financial ecosystem.

Mrs. Elizabeth Genia, Governor of the BPNG, conveyed through De-

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puty Governor Mr. Jeffrey Yabom, a message to the Ministerial delegation emphasizing BPNG’s mission to serve the people of PNG. This mission involves implementing effective monetary policy and maintaining a sound and inclusive financial system, she noted, highlighting the systemic implications of climate-related events and policy changes on financial markets and underscoring the need for proactive measures to address climate-related risks.

In response to climate change-related issues, the BPNG is dedicated to playing a pivotal role in safeguarding market stability by proactively addressing climate-related risks and strengthening resilience.

Bank of PNG, Assistant Governor, Mr George Awab, who is also the Chair of the Steering Committee for the Green Finance Centre, stressed a focus on normalizing required finance not only at the international level but also domestically.

Getting the support from the New Zealand government is to develop the Green Climate Centre, which is the key Agency, he said.

The establishment of the Green Finance Centre, supported by the Global Green Growth Institute (GGGI) and the Centre for Excellence in Financial Inclusion (CEFI), marks a significant milestone in promoting green growth and eco-

nomic diversification in Papua New Guinea.

Funded by the New Zealand Ministry of Foreign Affairs and Trade (MFAT) under the Low Emission Climate Resilient Development (LECRD) program, the GFC aims to integrate inclusive green finance policies into lending operations, fostering financial inclusion and sustainable investment activities.

In partnership with the Centre for Excellence in Financial Inclusion (CEFI), GGGI developed the Inclusive Green Finance Policy (IGFP) in 2023.

This initiative, funded by the New Zealand Ministry of Foreign Affairs and Trade (MFAT) with a grant of USD 670,000 under the Low Emission Climate Resilient Development (LECRD) program, led to the establishment of the GFC. The GFC is mandated to implement the IGFP and Roadmap and oversee other green finance initiatives in the country aimed at mitigating climate-related risks, promoting green finance, and catalysing investments towards a more sustainable future.

The primary goal of the project is to develop and integrate the Inclusive Green Finance Policy (IGFP) into the lending operations of financial institutions. This integration aims to create a financial ecosystem conducive to financial inclusion, green growth

The Roundtable discussion help between NZ Delegation and PNG Delegation at BPNG in Port Moresby. -image provided SCA GFC

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< Page 104 in investment activities, and economic diversification, which in turn will lead to an increase in green jobs.

Hon. Watts reiterated New Zealand’s commitment to advancing green finance initiatives and expressed eagerness to collaborate with Papua New Guinea on harmonizing green taxonomies.

He emphasized the economic dimensions of climate change, stating, “The way we address today’s pressing climate issues will shape our future.”

The significant roundtable meeting was attended by New Zealand Delegation; Hon. Simon, Watts, Minister of Climate Change, Hon. Dr Shane Reti, Minister of Health, and Minister for Pacific People.

New Zealand MPs Hon. Tim van de Molen, MP and Chair of the Foreign Affairs, Defence and Trade Committee, and Hon. David Parker, an MP for the Labour Party (not current in Government) and opposition spokesperson for Foreign Affairs, were present.

Gerardine Clifford, Chief Executive, Ministry for Pacific Peoples, Charlie Gillard, Deputy High Commissioner, New Zealand High Commission and Laura Holder, First Secretary, New Zealand High Commission were also with the delegation.

Accompanying the NZ delegates were Jessica Rowe, Private Secretary, Minister of Climate Change; Nelson Tiatia, Private Secretary to Minister Reti; Charlotte Gendall, Press Secretary to Minister Reti; Ramphaey Gime, Development Programme Coordinator; and Cynthia Duoribi, Policy Adviser.

PNG delegation attendees included Mr Jeffrey Yabom, Deputy Governor BPNG; Mr George Awap, Asst. Governor BPNG and Chair Steering Committee GFC; Ms. Debra Sungi, Acting Managing Director, Climate Change and Development Authority; Mr. Mohinesh Prasad, Head of Green Finance Centre; Mr. Saliya Ranasinghe, Executive Director CEFI; Mr. Peter Samuel, Deputy Executive Director, CEFI; Mr. Peniamina Leavai, Deputy Country Rep, GGGI PNG; and Mr. Angus Moina, SCA GFC. During the roundtable discus-

106 PNG BUSINESS NEWS

sion, BPNG Assistant Governor Mr. Awap, who also serves as Chairperson of the Steering Committee for the Green Finance Centre, thanked the New Zealand Government for its regional leadership on climate change.

Mr. Awap highlighted the critical role of the Green Finance Centre in fostering a sustainable financial ecosystem in PNG. Mr. Prasad, Head of the Green Finance Centre, updated the delegation on the significant progress the GFC has made, and its forthcoming initiatives aimed at greening PNG’s financial system.

Through leadership, guidance, and support, the Centre will mitigate climate-related risks, promote green finance, and catalyse investments toward a more sustainable future for PNG, he said.

Key outcomes from the discussion include New Zealand’s continued support for the Green Finance Centre’s mandate and intentions to collaborate with Papua New Guinea on carbon markets. The collaborative efforts between the two nations ref lect a shared commitment to building resilient and sustainable financial systems in the face of climate change challenges.

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PNG BUSINESS NEWS 109

FINANCE

‘Investment is Key’: IMF Update on PNG Economic Outlook By: ROSELYN EREHE

T

he International Monetary Fund (IMF) Country Head, Mr. Sohrab Rafiq, recently gave an update on the multinational lender’s program with the Papua New Guinea government.

Mr. Rafiq highlighted the progress made in the IMF program, with successful completion of the first and second review missions, and underlined the importance of the IMF’s concessional financing, offering affordable options for the PNG government.

Mr Rafiq’s presentation addressed the government’s fiscal position, noting a decline in the fiscal deficit post-COVID, with projections indicating a return to a balanced budget by 2027, provided government implements policies effectively.

He also discussed foreign exchange (FX) issues, emphasizing evidence-based policymaking to guide advice on the exchange rate and FX matters.

“Based on 2023 actual fiscal numbers, the fiscal deficit now of the

government of PNG is back where it was pre-COVID. Based on current projections and based on discussions that we’ve had on the policies that are in the pipeline, on the revenue-generating capacity of the government, on the spending, and so on, the fiscal deficit is projected to narrow over the coming years,” Mr. Rafiq said.

“Assuming that the policies are implemented and assuming that there’s no large economic shock, by 2027 the government should be running a balanced budget, which is quite an achievement,” he added.

Mr. Rafiq also tackled head-on the misconceptions surrounding PNG’s debt situation in the media.

He addressed the prevalent notion that PNG’s debt is alarmingly high, stating: “When compared with regional peers, PNG’s debt is broadly in line and not exceptionally high. In fact, it’s lower than countries like Fiji, Mongolia, and Malaysia, all of which are significant commodity exporters.”

The Port Moresby Chamber of

Commerce and Industry (POMCCI) hosted the Business Breakfast where the updates were shared, on May 10th at the Royal Papua Yacht Club, which also included commentary from Mr. Marcel Schroeder, PNG Country Economist of the Asian Development Bank.

Clarifying IMF’s role and financing, Mr Rafiq said contrary to misconceptions, the Fund’s role is to advise and support the PNG government, not to undermine sovereignty.

The IMF provides concessional financing at low interest rates to assist in fiscal management, he noted.

He also underscored the successful completion of the first two reviews of the IMF program in PNG, attributing it to the government’s commitment to reform.

“The IMF is only here to advise and support the government. The ownership of the government, the ownership of the reform agenda belongs to the government.

Mr. Rafiq acknowledged the chal-

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< Page 110 lenges of foreign exchange shortages and overvalued exchange rates in PNG. He explained the economic implications, such as reduced GDP growth and declining per capita income, citing empirical evidence from other countries.

He stressed the need for investment and highlighted the IMF’s role in providing policy advice and financing to address these challenges.

“The kina has been depreciated against the US dollar, which is true.

Whenever you are sort of looking at the exchanges, you need to look at what is your initial condition. Where are you starting? Where are we today? I don’t think that’s a controversial statement to make.”

“Now, what that means is that there’s a persistent, more accumulation in the exchange rate because of the persistent mismatch of supply and demand for foreign currency. Because of this mismatch exists, the central bank, will have to come into the market and make interventions and try and enforce policies.”

Mr Rafiq reiterated, “There is not a single example of a country (in Asia-Pacific) that has diversified its economy with a normal value exchange. That’s just a matter of historical record.”

Within the IMF, comprising 190 countries and in comparison, PNG is not the only country going through currency deficit and foreign exchange issues, he said.

“That’s just empirical data. Now, with a normal value exchange rate, there’s a mismatch of supply and demand in the foreign exchange market.

The central bank must intervene to try and clear that mismatch.

“Of course, unless you’re an oilrich dollar country that has trillions of dollars in foreign exchange and you can go on to intervene in the market at any rate and clear the market at any rate, unless you’re a country like that, BPNG must manage its foreign exchange reserves.

And it can only intervene at the level that is sustainable for its balance and for its level of foreign exchange. And that’s what produces the effects.”

Mr. Rafiq outlined the importance of gradual adjustments in the exchange rate to align with market levels, emphasizing the need for sustainable reforms. He reassured stakeholders

112 PNG BUSINESS NEWS

that the IMF stands ready to support PNG in reversing economic challenges and promoting growth.

“If this country’s average growth rate had been maintained at its pre-2014 level, the economy of PNG would be billions of dollars bigger than what it is today. Billions of dollars bigger than what it is today.

Now, some of you may argue it’s entirely coincidence that the declining of PNG’s average GDP growth happens when the FX shortage has begun.”

“I’ve heard some people say this, that it’s entirely coincidental. But if you look at the patterns in the data, it’s an incredible coincidence that PNG’s GDP growth began declining when the FX shortage began.”

Mr. Rafiq highlighted persistent supply-demand imbalances leading to FX interventions by the central bank.

He stressed the need for a realistic exchange rate, citing examples from the Asia-Pacific region.

“And that’s the cost that the FX shortages, which is the result of an overvalued exchange rate, that is the cost that’s being imposed on this country. Now, based on current trends, if we assume this level of GDP growth, and we assume overvalued exchange rates, and we assume population growth of 3.5%, what it suggests is that this country is going to continue to get poorer.”

Mr Rafiq added, “There’s no investment. This is a cross-country comparison chart on foreign direct investment. There’s only one country on this list that has had a persistently overvalued exchange rate and FX shortages. So, no investment, very low levels of growth, declining per capita GDP. “As I said, there’s no example in the world of a country having diversified

its economy with a normal market exchange rate, and you see that in the data for PNG as well.”

He also commented on IMF’s dedication to fostering global monetary cooperation, ensuring financial stability, facilitating international trade, promoting employment and sustainable economic growth, and reducing poverty worldwide.

Mr. Sohrab Rafiq emphasized the IMF’s role in engaging with various stakeholders, including the business community and NGOs. He further explained the method used by the IMF to gauge fiscal sustainability, the debt-to-GDP ratio, noting, “Despite an upward trend in recent years, projections indicate stabilization, contrary to media portrayals. This marks a significant departure from the pre-COVID era’s sliding debt trajectory.”

Attributing this stabilization to the government’s reform agenda supported by the IMF, Mr Rafiq highlighted the Fund’s role in providing technical assistance on finance and expenditure policies.

He emphasized the concessional financing provided by the IMF, by which the arrangement for the current three-year program, the interest rate on PNG financing is 2.8% with an interest rate of 2.8% and a five-year grace period, contrasting it with the considerably higher rates in international capital markets.

“This concessional financing affords the government breathing room to implement reforms gradually, thereby avoiding undue strain on the economy,” Mr. Rafiq stated.

He underscored the importance of IMF financing in bolstering foreign exchange reserves and attracting other sources of multilateral financial assistance.

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The Chamber might facilitate collaborative efforts on sustainability and corporate social responsibility, aligning with global and local environmental and social governance trends.

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PNG BUSINESS NEWS 113

COMPANY

Something for Everyone with NiuHomes

N

iuHomes, from PNG Forest Products, manufacture premium designed, quality kit homes in ranges to suit every budget and lifestyle in Papua New Guinea.

Perfect for those starting out on a tight budget, the Baset Range starts at only K69,550 and provides low-cost 3 & 4 BR kit homes that are designed to lock-up stage, with no internal fixtures or fittings apart from f looring and wall frames.

This allows you to complete the inside of the house within your own timeframe and budget, making it truly your home.

With 2, 3 & 4 BR options, the Residential and Suburban ranges are complete kit homes with a huge range of quality inclusions, right down to the kitchen sink.

In fact, many models have everything you need including electrical wiring & fittings; full plumbing kit including toilet and shower; ceramic tiles; joinery kit; ceiling fans; even paint… all included in the price of the kit home! Prices range from K92,300 to K362,000.

The Contemporary Range sets a new standard in modern kit home designs with the Komoa and Pacifica models.

Their sleek, modern designs uniquely complement the PNG urban landscape whilst providing spacious, elegantly comfortable homes for the extended family. The Komoa starts at K295,000 while the top-of-the-range Pacifica is K583,000.

For village living, the Haus Ples range offers a choice of high-set and low-set kit homes that start from a K70,000 for a 2-bedroom Lewa model, up to K102,700 for the 3-bedroom, split-level Namo with bathroom, laundry and kitchen. All prices stated are ex-GST and ex-Lae. And that’s not all! PNGFP also produce a quality range of kit buildings for Education, Health, Administration and the Resource Sector.

When it comes to quality, NiuHomes are PNG’s only preservative pressure treated kit-buildings engineered to the most stringent PNG and Australian building code

114 PNG BUSINESS NEWS

standards. All timber is randomly and rigorously tested in Australia and the Timber Training Institute in Lae to ensure compliance with the relevant Australian and PNG building standards.

PNGFP’s ability to produce pressure-treated timber at their certified and international standard

compliant plant in Bulolo, ensures quality, durable kit-homes that are protected from termites, rotting and fungal decay.

For more information call 323 5995, or email buildingsales@ pngfp.com, or view and download product brochures at www.pngfp. com.

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COMPANY

Proudly PNG: Remington Technology Honoured as ‘Dealer of the Year’ in Australia-Pacific Region

R

emington Technology (RT), Papua New Guinea’s leading print and document solutions provider, has been awarded the prestigious ‘Dealer of the Year’ accolade at Konica Minolta Australia’s Kick-off conference held in Sydney in May. As the only authorised Konica Minolta dealer in Papua New Guinea, this award recognises RT’s outstanding sales and service excellence across Australia-Pacific.

Remington Group CEO and Dealer Principal Peter Goodwin shared his pride: “I am incredibly proud of GM Justin Kieseker and Team RT’s outstanding achievement in being named ‘Dealer of the Year’ for the Australia-Pacific Region. This is a big deal and ref lects the dedication and hard work of everyone at Remington Technology, and Group Shared Services.

“For over 75 years, we’ve been a proud Papua New Guinean company, committed to delivering exceptional print and document solutions. Our strong partnership with Konica Minolta has been key to our success.

“This accolade highlights our market leadership and reinforces our commitment to our community and clients. We are grateful for our loyal clients’ support and look forward to continuing our journey of innovation and excellence together.”

Echoing this sentiment, Justin Kieseker, General Manager of Remington Technology, remarked, “RT is a 100% home-grown business that has been providing top-tier print and document solutions to businesses throughout the country for over 75 years. The reliability and innovation of the Konica Minolta brand significantly distinguish us from our competitors.”

Konica Minolta’s extensive range of products, including the advanced KM i-Series, Production Printers, and comprehensive software solutions, have consistently empowered businesses to streamline their operations.

Kieseker added, “Our part-

(L-R): Remington Group CEO, Peter Goodwin, longest serving staff & Senior Account Manager, Tom Mugwasawa, Justin Kieseker (General Manager Remington Technology), Yohei Konaka (Managing Director Konica Minolta Australia) and Brian Wood (General Manager Commercial & Indirect KM Australia).

nership with Konica Minolta, spanning 25-30 years, solidifies our exclusive status as the only authorised dealer in PNG. This award further elevates Konica Minolta’s prominence in PNG and affirms Remington Technology’s leadership in the print market.”

Despite facing economic challenges, Remington Technology has thrived due to its dedicated team and loyal client base. Kieseker emphasised the importance of adapting business strategies to the economic environment, meticulous planning, and maintaining strong business relationships.

Looking ahead, Remington Technology aims to expand its market presence and customer base through a consultative approach, helping customers save money and improve efficiency in their day-today operations. This forward-thinking strategy reinforces RT’s

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commitment to continuous growth, exceptional customer service, and staying ‘Loyal to Local.’

PNG BUSINESS NEWS 115

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COMPANY

Tropicair Terminal Upgrade for Jackson Airport

O

ften referred to as PNG’s premier charter airline, Tropicair recently completed a major upgrade of its terminal at Jackson’s Airport.

Tropicair CEO, Ivona Kadlec, explains why.

“In 2023 Tropicair commemorated 25 years of operation in PNG. As the airline has grown over that time, so too have the number of passengers and clients. Thus, there was a need to provide more space for waiting passengers, especially in the peak morning times.

“Whilst expanding the space, we took the opportunity to totally upgrade the terminal and modernise it, to make it a bright, fresh, pleasant place for passengers to wait for their flights.

“Our passengers and clients now get to enjoy a spacious public terminal, with more seating in a bright, appealing environment decorated with not only reference to PNG’s aviation history, but also to the beauty of the country we operate in.

“There is a new VIP lounge with hot and cold drink facilities and screen for viewing programs. Additionally, passengers now can choose to wait in our new under cover outdoor seating in an attractive garden setting.

“For convenience, passengers can be picked up and dropped off just a few metres from the terminal in Tropicair’s secure car park. They also get to enjoy the benefits of a terminal where all the operations of the airline are close at hand and questions and issues can be addressed directly by Tropicair personnel responsible for the various aspects of the operation.”

Driven by the vision of founder and MD Tony Honey, Tropicair commenced charter operations in 1998 with a single aircraft and has since expanded in size and scope to offer a modern, well-maintained jet and turbine powered aircraft fleet, delivering passengers and freight to destinations both countrywide and internationally.

The fleet consists of one Cessna Citation CJ3 jet aircraft; four Beechcraft Super King Air B200s; two Cessna C208B Caravans; and three De Havilland DHC6 Twin Otters, with further plans for future expansion.

More than just a charter airline, Tropicair offers a wide range of services including aero-medical operations,

118 PNG BUSINESS NEWS

secure transport movements, surveillance flights; government, VIP and private charters; and resource company requirements covering both passenger and freight services.

The scope of its operations cover the whole of PNG as well as within the broader region to Australia, other Pacific Nations and into SE Asia.

Tropicair also provides a valuable community service that helps connect Papua New Guineans by offering Fares & Freight services to the Gulf and Western Provinces, as well as to Tufi in Oro Province.

“Flight safety is our company cul-

ture” says Ms Kadlec. “We are CASA PNG and CASA Australia compliant.

Our safety record in the PNG aviation industry is exemplary and we hold BARS accreditation at the much-coveted Gold status.

“We pride ourselves on the quality of our aircraft and the depth of knowledge and training that our maintenance and flight crews possess.”

For more information on Tropicair services you can email ops@tropicair. com.pg or gm@tropicair.com.pg, or call 311 2673 or view the websites at www. tropicair.com.pg and www.medicair. com.pg.

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COMPANY

Downtown Plaza Embracing Sustainable Energy Solutions

S

teamships is pleased to share its sustainability initiative of the installation of solar panels on top of Downtown Plaza, located in the capital’s Central Business District.

The project marks a significant step towards the company’s dedication to utilising renewable energy sources and reducing its carbon footprint.

Installing solar panels highlight the company’s broader efforts to improve the environmental sustainability of Downtown Plaza but also represent a vital step towards a more environmentally conscious future.

Leading the solar panel project, Pacific Palms Property (PPP) is working in collaboration with PNG Power Limited (PPL) on the pioneering PPL Solar Pilot Programme. Other key stakeholders include Astra Solar Limited and YZ Consulting.

Upon completion, the energy produced by the panels will supplement the existing power supply. While the panels harness electricity from sunlight, the traditional power grid will remain accessible to provide a reliable energy source for Downtown Plaza.

“Steamships and its businesses commend PNG Power’s pilot initiative to implement renewable energy solutions.

Steamships have made a long-term commitment to reducing our carbon

Aerial view of Downtown Plaza rooftop

footprint, adopting best practices with an aim to achieve net zero emissions by 2050.” said Steamships MD Rupert Bray.

“With mutual dedication to explore renewable energy, we hope to continue working with PPL, and as leading business houses, embrace sustainable power solutions within PNG” Downtown Plaza serves as the model project for an initiative that ensures our buildings are more resilient during adverse conditions. This endeavour not only prioritises resilience but also extends a helping hand to tenants striving to meet their Environmental, Social, and Governance (ESG) targets.

This public and private sector collaboration shows a shared commitment to deploy technologies that not only

advance infrastructure but also foster the development of Papua New Guinea as a whole. As this initiative gains traction, its impact is poised to expand far beyond Downtown Plaza, offering a blueprint for progress and sustainability.

The project highlights the businesses strong commitment to environmental stewardship and paves the way for additional initiatives aimed at enhancing the sustainability of PPP assets.

Recent sustainability efforts include the Steamships Corporate Office, @345, which obtained the Excellence in Design for Greater Efficiencies (EDGE) certification, establishing it as the first “green” commercial building in PNG and the Pacific. The solar project is due for completion Q4 2024.

New Papua New Guinean Leader for PacTow

M

aritime veteran Gerard Kasnari has taken over the leadership of marine services market leader, Pacific Towing (PacTow). Previously, PacTow’s Marine Operations Manager and ‘2IC’ for nearly a decade, Kasnari’s new role of ‘Manager Pacific Towing’ has him overseeing the day-to-day operations of the business.

With nearly 40 years’ experience in PNG’s maritime sector, Kasnari brings a wealth of expertise to the position. Importantly, he has played a critical role in many of the achievements and initiatives (such as workforce nationalisation, cadetship programmes, f leet upgrades, regional expansion, and new

services) that underpin PacTow’s success.

Kasnari’s first role with PacTow was as its HSSEQ Manager and Designated Person Ashore.

After being promoted to Marine Operations Manager in 2019 he continued to play a key role in enhancing PacTow’s safety systems, processes, and performance – including the company’s first 5-year LTI-free period.

Kasnari commenced his seafaring career in 1985 and became one of the country’s youngest ships masters at just 24 years of age. In addition to his maritime experience, Kasnari also has considerable mining logistics experience, including aircraft and trucking operations.

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He held supervisor and manager roles with Ok Tedi mining for nearly 14 years, as well as a management position on the Frieda River Project.

Steamships Managing Director, Rupert Bray, emphasised that Kasnari’s “considerable experience in combination with his dedication, commitment, and proven leadership skills make him the ideal candidate to take Pacific Towing forward and to continue to deliver exceptional service to its customers.”

Kasnari replaces Neil Papenfus, who after 17 years with Steamships, has taken up a position with PNG Ports Corporation. We extend our gratitude to Neil and wish him every success in his new role as CEO of PNG Ports.

PNG BUSINESS NEWS 119

COMPANY

Blue Water Opens Bookings for LCL Consolidation Services Connecting Australia, PNG

B

lue Water is now opening bookings for its highly anticipated Less than Container Load (LCL) Consolidation Services, facilitating seamless connectivity between Australia and Papua New Guinea.

This innovative service heralds a new era in cargo shipping, promising efficiency, and reliability, the company said in a statement.

Blue Water’s LCL Consolidation Services offer an end-to-end solution, ensuring a consistently high standard of service throughout the shipping process.

Specifically tailored for industries with regular shipments, companies prioritising service excellence, and those deeply integrated into global supply chain networks, this groundbreaking service is set to redefine cargo logistics.

Clients spanning various sectors can now confidently book Blue Water’s LCL Consolidation, guaranteeing a reliable, efficient, and

customised shipping solution tailored to their unique needs.

From the initial cargo collection point to the final delivery destination, Blue Water assures a top-tier shipping experience.

ENHANCED SHIPPING EXPERIENCE Sean Adams, General Manager of Blue Water Papua New Guinea, emphasizes, “At Blue Water, our commitment is to redefine shipping logistics by providing innovative solutions that simplify and enhance the shipping experience for our clients.”

Designed to optimise the transportation of smaller cargo loads, Blue Water’s LCL Consolidation Services offer cost-effective and reliable solutions for businesses of all sizes.

By consolidating multiple smaller shipments into one container, Blue Water aims to streamline the shipping process, reduce costs, and minimize environmental impact.

This announcement marks a signif-

icant stride forward in Blue Water’s mission to continually enhance its services and meet the evolving needs of the shipping industry. For booking inquiries and additional information, please contact BWS_PNGFAKBookings@bws.dk.

Blue Water is a prominent name in the shipping industry, dedicated to providing innovative solutions that redefine logistics. With a steadfast commitment to excellence, Blue Water endeavours to simplify and enhance the shipping experience for clients worldwide. For more information, visit www.bws.net.

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COMPANY

TIPS For Kids Redefines Ways of Learning By: ROSELYN EREHE

I

n Papua New Guinea, educational dynamics are evolving, led by Dianne Meli, the Founder and Director of TIPS For Kids. Established when Meli was age 26, TIPS For Kids started as a tutoring service for early childhood and grew into a registered homeschool, a first in PNG. TIPS stands for Tailored Individual Programs Supporting Children in Need, with a mission to bridge education gaps and a vision to provide tailored programs for children.

Its services are: - Full-time homeschooling for grades 1-10, operating as a private school with full-time services at clients’ homes on weekdays, with recess, lunch breaks, and holidays.

Each family gets a dedicated teacher for personalized attention, with multi-grade teaching for families with children in different grades.

- Uses the ACE PACE Curriculum,

recognized internationally and recommended for homeschooling.

- Tutoring Services: Sessions offered during holidays and Sundays for early childhood to Grade 8, with secondary support upon request.

Individual tutoring at home is also available.

- PACE Order Services: Facilitating purchase orders for the ACE PACE Curriculum, empowering parents in their children’s education.

Dianne’s personal journey influenced the founding of TIPS For Kids.

Homeschooled herself under the ACE PACE Curriculum, she saw the need to extend similar opportunities to others.

Working in Port Moresby schools and witnessing gaps in education post-Covid-19, she aimed to redefine the education system by providing tailored support for struggling children.

Her vision for TIPS For Kids focuses on personalized educational

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experiences, changing traditional schooling paradigms in Port Moresby.

“During my experiences working in the classroom assisting teachers in Port Moresby, I noticed a small but growing number of struggling children,” she says.

These were children “who need more time to master a concept, a subject, a topic, children who are slow and learn individually, children who cannot progress collectively at the same speed with other children in the classroom or together in a group.”

“I recognized these children have a need; they need a teaching program that must be tailored to meet their needs. I decided that I want to use my experiences and my education and start a school that will help these children in need.”

“When I see these children struggling, I remember my own struggles, and I want to help them,” Dianne says.

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Large-Scale South African Farmer Relies On German Hydropower Expertise For A Third Time EDITOR’S NOTE: Ossberger, the German hydro-industry experts, has provided PNG Business News with this feature story that originally came out in Zek Hydro magazine’s May 2024 issue. Ossberger has supplied and installed 19 mini-hydropower turbines throughout PNG, mostly in rural districts, since the 1960s. The company likewise provided the hydropower systems for PNG Power's Hargy 1 & Hargy 2. It believes the technology featured in this story applies to the country as well.

The South African farmer Michael Vermaak has become a loyal and regular customer for Ossberger, the German hydro-industry experts. Since 2008, three small hydropower plants have been built on the expansive Klipfontein farm in the village of Cookhouse. All three have been equipped with comprehensive Ossberger electromechanical packages. The latest plant went online for the first time in September 2023 with another one of Ossberger’s high-performance technology packages – including a crossflow turbine with a bottleneck capacity of 412 kW, and all the electrical fittings and control equipment. Furthermore, at the oldest plant all the control technology was updated. Resultantly, all three power plants can now operate as island solutions or in parallel grid operation – and each one is equipped with blackstart capabilities.

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nyone in South Africa self-sufficient enough to meet their own electricity needs with a proprietary power plant can count themselves very lucky. So-called ‘load-shedding’ is part of everyday life for around 60 million inhabitants in the southernmost country on the African continent. Power cuts can last up to twelve hours, with entire regions and cities being taken offgrid. According to ESKOM, the state-owned energy supplier, South Africa’s power supply would collapse completely without loadshedding. Corroborative media reports suggest that a major reason for the problematic situation is the generally desolate state of the country’s energy infrastructure, resulting from decades of mismanagement and corruption.

KLIPFONTEIN FARM IS SELF-SUFFICIENT Having taken matters into his own hands in 2008, building a small

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Three small hydropower plants at Klipfontein Farm in Cookhouse, South Africa, provide power for energy-intensive agricultural infrastructure, and also feed into the public power grid. As small hydropower experts, Ossberger’s specialists were able to supply the electromechanical instrumentation and control equipment for all of the reliable crossflow turbine hydropower plants.

hydropower plant on his extensive K lipfontein Farm property in the village of Cookhouse, Eastern Cape Province, the nationwide energy supply problem is no longer a cause for concern for Michael Vermaak. The plant utilises the hydro-energetic potential of an irrigation canal branching off from the local Fish R iver, and supplies water to a number of farms. Acquisition of additional properties enabled the operator to expand his farm and led to increased demand for energy. In response, in 2018 a second hydropower plant was built and commissioned, and in September 2023 a third plant went into operation.

OSSBERGER SUPPLIES RELIABLE SOLUTIONS Ossberger crossflow turbines have been in use worldwide for over 100 years and the expertise of these German industry specialists was the operator’s first choice from the first plant on; and for the full range of technical hydropower plant infrastructure – machine sets, hydraulic steel structures, electrical fittings and control technology. Christian Habermann, Ossberger’s Technical Director ex-

plained: “Generally, South Africa is a favourable market for us, and in our experience, Ossberger turbines are particularly appreciated by operators of systems on irrigation channels as on Klipfontein Farm. The objective for a basic crossflow turbine is not to harvest the last possible percentage point of its efficiency potential, but to deliver electricity reliably and uncomplicatedly. This is the core characteristic of our solutions and, ultimately, something our customers consider to be particularly important.”

Technical Data • Flow Rate: 2.5 m³/s • Net Head: ca. 20 m • Turbine: Crossflow Turbine • Rotation Speed: 280 rpm • Max. Output: 412 kW • Manufacturer: Ossberger • Gear Ratio: 1:3.6 • Generator: Synchronous • Frequency: 50 Hz • Voltage: 400 V • Nominal Output: 475 kVA

The small hydropower plants in Cookhouse generate electricity for energy-intensive agriculture, and to feed into the public grid.

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A signif icant proportion of the electricity generated is directed to a pumping station with several variable-speed pumps. The station is used mainly during the night to f ill a reservoir excavated from a hillside for the irrigation of surrounding farmland.

MULTI-MODAL OPERATING EQUIPMENT The f irst plant, built in 2008, was designed purely for island operation. Now, however, all three power plants can operate in island and grid-parallel modes, and all have black-start capabilities. Ossberger’s scope of delivery for the latest hydropower plant in K lipfontein consisted of the crossf low turbine, gearbox and synchronous generator, the f lywheel, the butterf ly valve and all electrical and I&C equipment. The horizontally-fed crossf low turbine is designed to achieve a discharge water volume of 2.5 m³/s with a net head of around 20 m, for a bottleneck output of 412 kW under full load conditions. Drive water for the turbine is provided via an underground penstock pipeline connected to a newly-built inlet on the irrigation canal. No separate screen cleaning machine was installed at the inlet area. However, Christian Habermann explained that, if required, such a machine could be retrof itted without great effort. After driving the turbine, the headrace water is returned to the diversion channel and, after a short distance, f lows into the Fish R iver. Plant construction took around a year and was completed in autumn 2023. The operator and several local companies played an active role in the plant construction phase. The machine building is completely subterranean, and assembly of the electromechanical equipment and cabling laying were tasks conducted by local labour teams. Ultimately, the power plant was commissioned in September 2023 under the supervision of an Ossberger technician.

THREE IS THE MAGIC NUMBER Operation of the state-of-the-art system is fully automatic. The control system can be accessed using touch panels installed in the machine buildings, or

A maximum of 2,500 l/s of expansion water for the new power station is discharged at the inlet area of the irrigation canal, and channelled to the underground machine room via a penstock.

The pump station receives electricity from the small hydropower plants and is equipped with a whole battery of variable-speed water pumps to fill the reservoir.

accessed online v ia smartphones and PCs. As well as being experts in the construction of turbines, the German all-rounders at Ossberger demonstrated their hydropower expertise by prov iding the full scope of control technolog y for the plant network. “In the course of order implementation it was also necessar y to modernise the electrical eng ineering in the oldest power plant. As a result, all three plants can now generate electricit y indiv idually, or combine automatically to form a completely synchronised network, depending on the current requirements”, Ossberger’s A rea

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Sales Manager Markus Sauerbeck told us. Christian Habermann summarised: “The entire project went ver y smoothly, and coordination and communication were f lawless. It was def initely of benef it to be familiar with each other from prev ious projects, and to be able to form a well-oiled team. We are certainly in a good position to implement further projects in the f ield of agricultural or municipal irrigation systems. The Cookhouse project is a good example of how an existing irrigation channel can now be used three times to generate clean electricit y.”

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Dataco, Oracle Sign MOU to Introduce World Class Cloud Infrastructure By: ROSELYN EREHE

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apua New Guinea DataCo and Oracle have signed a memorandum of understanding to advance the country’s critical digital infrastructure and to introduce world-class cloud infrastructure through the Oracle Alloy product.

The MOU was signed on May 10th in Port Moresby as Information and Communication technology Minister Timothy Masiu welcomed Oracle Corporation into PNG to support the government’s digital transformation agenda.

Mr. Masiu congratulated DataCo for this initiative and welcomed the signing of the MOU. He said the world re-known company Oracle, specializing in cloud technology has offered to invest in critical digital infrastructure in Papua New Guinea.

“I met with PNG Dataco and Oracle officials this week and am impressed with what they can bring in including training and capacity building and to work with PNG DataCo to strengthen and expand their digital infrastructure to support the overall

government digital transformation agenda.”

Mr. Masiu encouraged PNG DataCo and Oracle to continue working in partnership with the Department of Information and Communication Technology as the department under the Digital Government Act 2022 is managing a “whole-of-government” approach to delivering cloud technology services.

The Department has advanced design and development of various critical e-government services including single sign-on to digital services and the eGovernment Portal, he said.

Mr. Masiu urged government entities to work with DICT, DataCo and Oracle to make this partnership feasible through providing required information and data to plan, tailor and customize their infrastructure and technical skills and build rollout plans in line with DICTt s framework and road map.

“Our people desperately need digital services made simple, fast, and easy.

With our geography and terrain, services are hard to reach our people

but there are certain services that can be offered digitally, and this is what the government envisions through the Digital Transformation Policy. We are ambitious in this endeavor as we head towards our silver jubilee in 2025.”

PNG DataCo Limited are keen for Papua New Guinea’s communications infrastructure and the future of connectivity.

PNG DataCo Limited CEO, Paul Komboi, GCL, OBE, made a presentation on Papua New Guinea’s communications infrastructure and the future of connectivity in the region at the Innovation PNG 2023, held at APEC Haus, Port Moresby on 10 November 2023.

He discussed the PNG Communications Market Snapshot, Supporting PNG’s Digital Ecosystem, DataCo Digital Infrastructure Plan, alignment with GoPNG’s MTDP-IV, Key Programs, and other innovative programs.

This is the next step Dataco is taking in supporting PNG’s future in digital connectivity.

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The Customer is King for Terrain Tamer

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errain Tamer 4WD have launched a new TV ad on various platforms across regional Australia, New Zealand, Fiji and Papua New Guinea, to air primarily during NRL, AFL and State of Origin matches.

Running from May until September, the ad, titled “Customer is King” follows the story of a young Frank Hutchinson, who founded the Terrain Tamer brand in 1969 and supplied strengthened 4WD parts to a young Bill King, who himself was in the beginning stages of starting what would eventually become the AAT Kings travel company.

Following Frank and Bill through the start of their journey, the ad shows the development of Terrain Tamer from its earliest years through to the intensive process of research and development that goes into their expansive 4WD parts brand today, as well as their continuing focus on meeting customer needs and providing quality service.

Filmed in Alice Springs across three days, the “1969” portion of

the ad was filmed using special camera equipment sourced by the project’s producers, to authentically represent the colours output by film at the time.

Terrain Tamer staff members Zac Perkins and Cameron McDonnell were called on to portray the younger versions of Frank and Bill and costumes were carefully sourced to match reference photographs.

Interspersed with footage of a Terrain Tamer vehicle travelling a red dirt road to deliver parts to a remote workshop, the present-day portion of the ad features the real Frank Hutchinson, along with his son Brent,

the company’s General Manager, utilising the technology offered at the Auto Innovation Centre in Melbourne’s south-east to showcase the thorough research, design and testing that goes into Terrain Tamer’s parts development.

Terrain Tamer’s new Customer is King TVC can be seen on TVWAN throughout the NRL Season in Papua New Guinea, as well as the brands Facebook and YouTube pages, or across AFL, NRL and State of Origin on Foxtel and various free-to-air stations around Australia.

For more information, visit terraintamer.com

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JVPS Earns Employer of Apprentices Accreditation, Bolstering Future PNG Workforce

J

oint Venture Port Services (JVPS) has been awarded the ‘Employer of Apprentices’ certificate by the National Apprenticeship and Trade Testing Board (NATTB).

This certificate signifies JVPS’s commitment to developing the next generation of skilled professionals within the critical heavy machinery and equipment industry.

The certification allows JVPS to hire and train apprentices in four key trade areas: • Heavy Equipment Fitting • Auto Electrical • Motor Vehicle Mechanic • Metal Fabrication and Welding “We are thrilled to receive the Employer of Apprentices accreditation from the NATTB,” said Greg Kettleton, General Manager, JVPS, in a statement.

“This certification allows us to invest directly in the future of PNG’s workforce by providing young Papua New Guineans with valuable on-the-job training and nationally recognized

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qualifications. This will ensure a continuous pipeline of highly skilled tradespeople to support our ongoing operations and contribute to the future needs of PNG.” To obtain the Employer of Apprentices certification, JVPS underwent a rigorous process established by the NATTB. This included a comprehensive site inspection to ensure the company possesses the necessary tools, machinery, and qualified personnel to deliver effective training in the designated trade areas.

“We commend JVPS for achieving this important milestone,” said Arthur Geno, Assistant Director for NATTB, during a recent certificate presentation ceremony.

“Their commitment to meeting our stringent requirements, including successful completion of a site inspection, demonstrates their dedication to providing a high-quality apprenticeship program. This program will serve as a valuable pathway for young Papua New

Guineans to gain the technical skills and knowledge needed to thrive in these essential trades.”

JVPS is actively developing its apprenticeship program and anticipates implementation later this year.

The program will provide structured training opportunities for apprentices, combining classroom learning with practical experience under the guidance of experienced JVPS tradespeople.

JVPS is a leading provider of stevedoring and cargo handling services across Papua New Guinea. Through joint ventures with local landowner groups, JVPS offers a comprehensive range of services at key ports throughout the country.

The company is committed to safety, efficiency, and environmental responsibility, while also supporting the development of local communities and the PNG workforce.

JVPS is part of the broader Steamships Logistics Division, an intermodal logistics provider solely owned by Steamships Trading Company.

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131 31 13 120 17 19 11 6 22,23,25 63 57 126,127 130 21 66 29 7 IFC 108,109 105 76 99 35 37 39 125 54 103 41 60 95

Hertz Hornibrook NGI Huon Logistics IEA International SOS iPi Island Mobile Hire Cars Joint Venture Port Services Kina Bank Kramer Ausenco Lae Biscuit Company LAE CCI Life Care PNG Markham Culverts Marriott Apartments Moni Plus MRA National Energy Authority Nambawan Super Nasfund Nipco Enterprises NiuPower Ok Tedi Ossberger Pacific Energy Aviation Pacific Palms Property Pacific Towing Peuna PNG PNG Chamber of Resources & Energy PNG CR

129 OBC 27 91 38 89 49 79 4 132 9 124 111 73 55 3 59 81 61 82 42 64,65 15 40 32 69 71 67 113 107

PNG Dataco 72 PNG Forest Products 28 PNG Mining & Petroleum 2,53 Hospitality Services PNG Petroleum and Energy Conference 116,117 Port Moresby Electrical 96 Port Side Business Park 77 QED 5 Remington Technology 74 Resources & Investment Finance Ltd 51 Sago Network 106 Santos 75 SGS 83 Steamships 87 Swire Shipping 8 TE PNG 47 Telikom 84,85 Tips for Kids 93 Trans Niugini Tours 110 Tropicair 24 Trukai 43 UMW IBC Vodafone 45 Wan PNG 128 Western Pacific Insurance 50 Westpac 1 WR Dental Clinic 70 Zad Zeal Limited 97 Zenex Drilling 33

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