New special-purpose company created for Yonki expansion

National Executive Council has authorised the creation of a special-purpose company within PNG Power, Yonki Hydro Ltd, to rehabilitate the Yonki power assets and expand the scheme.

“This brings the full development of Yonki, in three stages, a step closer to fruition,” State Enterprises Minister Sir Mekere Morauta said.

“The O’Neill-Namah government’s aim is to stabilise generation as soon as possible to prevent the current widespread power cuts affecting the Momase-Highlands region, especially in Lae and Madang.

“Our long-term aim is to greatly increase power supply to the region to allow the development of new resource projects, promote economic development and increase the standard of living of the people in the area.

“We now have a coordinated strategy for repairing and expanding Yonki and ending the power cuts that have crippled the business sector over the past 10 years of the Somare government and caused such problems in the daily lives of ordinary Papua New Guineans.”

An important element of the plan is to make provision for landowner equity in the Yonki scheme.

The Somare government failed to deal with this very important issue, Sir Mekere said.

The O’Neill-Namah Government will tackle it in two ways.

 “The first is to develop a framework for landowner participation as private equity partners,” he said.

“The second is to encourage the employment of landowner companies in the development and construction phase by acting as preferred providers of services.

“Other private sector participation in the project is to be encouraged through existing PPP (private public partnership) arrangements.

“PNG Energy Development Ltd, a 50-50 joint venture between PNG Sustainable Development Ltd and Origin Energy of Australia, has joined the project steering committee recently set up by IPBC (Independent Public Business Corporation).

“This committee will continue with its technical, social, environmental and social investigations.”

The Yonki project has three phases. They are:

• The refurbishment and upgrade of Ramu 1 power station, at a cost of K58 million. Further work will be needed to return the station to full operational capacity, which is expected late this year;

• The completion and commissioning of the Toe of Dam generation system. The Toe of Dam project is designed to generate 18 megawatts of power from water flowing down the dam spillway that would otherwise be wasted. Construction began in 2009 but was suspended owing to problems with the contractors. PNG Power has now resumed construction work with support from two Japanese companies - Nippon Koei and Daiho  – and expects the plant to be commissioned by the middle of next year; and

• The construction of a new powerhouse, Ramu 2, which would generate an additional 120 - 180 megawatts bringing the total power generated at Yonki to  from 45 megawatts to 180-240 MW.

Sir Mekere said the transfer of assets into Yonki Hydro would be subject to due diligence, and a final feasibility study would be needed for Ramu 2.

Lae port project cuts down red tape

 National Executive Council has approved the adoption of immigration and customs processes for the K700-million Lae port project.

NEC’s decision means the Lae port project will go ahead under the procedures laid down for the PNG LNG project at the Department of Labor and Industry and the Department of Foreign Affairs and Immigration.

“This is a critical project for the Momase and Highlands regions, and by applying a similar process approved for PNG LNG, we can cut red tape and fast-track work,” Minister for Public Enterprises Sir Mekere Morauta said.

“The arrangement will cover both the construction supervision consultant, Korean Engineering Consultant Corporation, and the civil works contractor, China Harbor Engineering Company.”

NEC also approved an extension of the temporary importation period from 12 months to 30 months for China Harbor Engineering’s construction equipment.

This means that equipment brought in temporarily under duty-free arrangements can remain in PNG for the full three years of construction.

Sir Mekere said NEC’s decision recognised that  the project was of special significance both nationally and within the Highlands and Momase regions.

“Congestion and inefficiencies at the existing Lae waterfront have increased costs across the region and nationally, and have been an impediment to economic growth and national development,” he said.

“The project - including a tidal basin, a berth and a terminal – will help to lower import costs and therefore the price of goods and services.

“It will also help to increase the competitiveness of Momase-Highlands exports to the rest of Papua New Guinea and overseas.”

Work on the project, funded 70% by the Asian Development Bank and 30% by the national government, is expected to finish towards the end of 2015.

NEC endorses report on Port Moresby waterfront

Minister for Public Enterprises, Sir Mekere Morauta, says that National Executive Council has endorsed a progress report from PNG Ports on future options for the Port of Port Moresby.

“The port is already working at maximum capacity and cannot keep up with the growth demands imposed by the surge in national economic activity over the past few years,” he said. 

“It is holding back economic development.

“Expansion is urgently needed, but there is not enough room at the present location to provide the required operational life of 100 years, nor is large-scale expansion appropriate there because of social and environmental issues.

“The scope of the expansion required for a 100-year life would also put even greater stress on local infrastructure such as roads and freight depots and warehouses.

“The consequences for people living and working close to the port – noise and dust pollution and the general inconvenience of large trucks moving through already overcrowded and unsuitable streets – would be intolerable.

“NEC has therefore endorsed a proposal from PNG Ports to move ahead with a plan to relocate the Port.”

Sir Mekere said the first step was to finalise the evaluation of a number of locations and identify a site that can provide the 100-year life span at the least possible cost.

Sir Mekere said previous studies had indentified Tatana Island and Motukea as the best available options. 

Napanapa and Bootless Bay have been excluded.

“This is a very large and complex project of national importance,” he said. 

“The task of finding a replacement for the existing wharf is now very urgent.

“Completion of critical engineering studies is now under way, as are investigations of land and water tenure issues.”

In the meantime, all efforts to make the existing port as efficient as possible are continuing.

 There is scope for one expansion to meet short-term demand, and this will also be considered.

NEC also endorsed the creation of a Project Management Unit by Ports PNG and a Relocation Project Steering Committee consisting of government departments and authorities.

Boom in PNG mining and petroleum

By MALUM NALU
Papua New Guinea is experiencing an unprecedented period of activity and growth in the mining and petroleum sectors, PNG Chamber of Mines and Petroleum executive director Greg Anderson said yesterday (Thursday), The National reports.
He highlighted this at the start of a two-day media workshop for journalists and industry public relations professionals at the Gateway Hotel in Port Moresby.

Participants at the first day of the workshop yesterday.-Nationalpic by MALUM NALU

“We (PNG) have been very blessed and if we can keep up the level of activity (in mining and petroleum), we can develop a number of exciting projects,” Anderson said.

Anderson (left) and workshop facilitator and veteran resource and business journalist Brian Gomez yesterday.

According to an updated industry overview from the chamber, mineral production in 2011 was over 62 tonnes gold, about 90 tonnes silver, and 130, 456 tonnes of copper contained in copper concentrate.
Activity in the petroleum sector is spearheaded by the much-publicised PNG LNG project which has focused international attention on the country.
The PNG LNG has increased the focus on PNG and has attracted international interest, which has contributed to the high level of activity on oil and gas exploration.
There are currently 71 petroleum prospecting licenses (PPLs) and over 15 applications pending, covering large parts of the country.”
PNG ranked as the 11th largest gold producer in the world in 2010.
“PNG has developed two major mining projects in the last two years, the Ramu nickel-cobalt mine in the Madang province which is at commissioning stage; and the Hidden Valley gold-silver mine in the Morobe province, which commenced production in 2011 and is ramping up an average annual production of 250,000 ounces of gold and 3.6 million ounces of gold,” the overview said.
“Over the last two years, there has been considerable capital expansion at the three major mines including, the twin declines at Porgera, now completed; the million ounce production upgrade (MOPU) at Lihir which is in its final stages and expected to come on stream at the end of 2012; and the ongoing technical studies at Ok Tedi to determine the possibility of a combined underground/open cut mine with a reduced throughput (to 60%) to extend mine life from 2015 to 2025.
“A mining lease was granted for the exciting Solwara 1project in January 2011.
“Situated about 30km offshore, west coast central New Ireland province, this will be the first project in the world to mine deep seafloor massive sulphide deposits which are small in size but boast exceptional grade (around 9% copper equivalent), compared to the standard onshore copper-gold mine.”
There are a number of potential mining developments achievable over the next 10 years, central to these being the three world-class copper-gold/copper-molybdenum Frieda (East Sepik), Wafi-Golpu (Morobe) and Yandera (Madang).
Current large mining projects include Barrick Gold’s Porgera gold mine, Ok Tedi copper mine, Newcrest’s Lihir gold mine and MCC’s Ramu nickel-cobalt project.
Three small to medium operations are Petromin’s Tolukuma gold mine, Allied Gold’s Simberi gold mine, and New Guinea Gold’s Sinivit gold mine.
“General exploration activity in the mineral sector is at a high level but administration to tenements has become an issue because the record number of applications and renewals has resulted in a backlog in the Mineral Resources Authority.
“At the end of the first quarter 2012, there were over 282 current exploration licenses and renewals and over 394 outstanding applications spread right across the country.”

In Port Moresby today: Thursday, May 17, 2012

The good, the bad, and the ugly of Port Moresby as captured through my camera lens today.
May they inspire you towards working together for a better Port Moresby and Papua New Guinea.
Enjoy.

This lady is placing cans on the road at Hohola for vehicles to flatten. All pictures@MALUM NALU



Two ladies and cans at Hohola




A taxi takes a free card wash at a Hohola drain




Car wash...gratis!



Holiday Inn extension

See how clean the streets are without the curse of buai pekpek!

I'd rather have more peanuts sold on the streets than buai!

Buai pekpek and other litter outside Mobil Service Station, Waigani!

A dramatic change as buai selling is stopped outside BSP Waigani

One thing I've noticed over the last couple of days. especially on my beeline to work, is that the streets are clean and there's not that much buai pekpek. I met this group of young fellas sitting outside BSP Waigani today and they told me ...that they've been given special orders by City Hall to ensure that there is no buai selling in public places. Good start, however, people are still spitting away uncontrollably like machine guns!



Outside BSP Waigani today minus buai




Chock-a-block along Spring Garden Road!



Vehicle trying to join the main Spring Garden road

Traffic along Spring Garden Road

A lonely street sign

Garden City, Boroko

Outside Garden City, Boroko

Street scene, Boroko

Outside Boroko police station

An enigma: When will this 'fresh food market' at Boroko open?

5-Mile roundabout

5-Mile roundabout

I like this signboard at 5-Mile

Road works at 5-Mile

Road works at 5-Mile

Along National Broadcasting Commission (NBC) studios, 5-Mile

Beauty of nature at 5-Mile

Road works at 5-Mile

Road works at 5-Mile

Road works at 5-Mile

Looking down towards Sioni Kamu Church from 5-Mile

Crowd waiting anxiously for PMVs at bemobile bus stop, Waigani

Crowd waiting anxiously for PMVs at bemobile bus stop, Waigani

Crowd waiting anxiously for PMVs at bemobile bus stop, Waigani

Afternoon traffic along Waigani Drive

Afternoon traffic along Waigani Drive

ANZ: Growth outlook for PNG looks strong

By MALUM NALU
The growth outlook for PNG remains strong, supported by government spending, commodity prices and the construction of the LNG project, according to the ANZ Pacific Economic Quarterly report released yesterday (Wednesday), The National reports.

The LNG project site outside Port Moresby… ongoing construction of the LNG project should continue to support projected growth of 7% in 2012.-Nationalpic by MALUM NALU

It also highlighted that political tensions had eased as the national elections approach.
“The construction of the LNG project, government-donor funded projects and strong private sector activity growth saw employment grow 6.2% year-year-on in Q4 (fourth quarter) 2011,” the report said.
“Credit growth slowed to 6.8% year-on-year in Q4 2011 compared to 10.6% previously.
“Though slowing growth is having a lesser impact on inflation, the central bank is concerned by high levels of liquidity from increased government spending and foreign currency inflows that may potentially threaten price stability.”
The report said high liquidity concerns saw the central bank endeavour to tighten monetary policy in Q1 this year through new central bank bills and an increase in banks’ cash reserve requirements, from 1% to 7%.
“However, the tightening approach did little to arrest a decline in interest rates: the 28-day bill rate stood at 2.40% at March-end and declined to 2.24% in early May,” it said.
“The kina has appreciated 3.9% against USD (US Dollar) so far this year.
“Inflation pressures will ease further if businesses pass on the currency’s strengthening to consumers.
“Recent political tensions have eased on the government’s commitment to issue writs on May 18 to be followed by a five-week election campaign.
“While the economic outlook for 2012 remains positive, softer commodity prices may result in a budget deficit.
“Government spending and ongoing construction of the LNG project should continue to support projected growth of 7% in 2012.
“We anticipate interest rates to remain under downward pressure, unless the central bank imposes further tightening measures.”

The street that Sir Mekere Morauta forgot!

By MALUM NALU

Welcome to my street...Notice that our road at Hohola 4 has completely gone, an instantaneous drain when it rains.
The paradox is that Moresby North West MP Sir Mekere Morauta has been doing big things for PNG, however, can't do little things like patch up this road.
Unfortunately, we'll have to suffer, as Sir Mek has thrown in the towel and won't be contesting this year.
He would have lost, anyway, it it would have been poetic justice for our long-suffering denizens to kick your butt!
Sir Mek (he told parliament on Tuesday) will be relaxing on his big boat, fishing and sipping red wine while we continue to suffer.
I doubt if the suffering of our children will bother your conscience, and besides, you're far removed from us in your ivory tower at Touaguba Hill.
Enjoy your red wine, Sir Mek!