The K146 million redevelopment of Lombrum Naval Base in Manus Province is one of the significant infrastructure projects recently acquired by Italy’s Webuild for A$39 million (K94.3 million), following mounting financial problems confronting Australian engineering and construction group, Clough.

Breakdown of the acquired Clough Group assets. Credit: Webuild

Unable to pay hundreds of creditors an estimated A$250 million in debts (K608 million), Clough Group, the former head contractor on Lombrum Naval Base project entered voluntary administration last December.

Clough Group is now a wholly-owned subsidiary of Webuild.

Webuild has confirmed that it is taking over the redevelopment of the Lombrum Naval base, and Clough’s administrator, Deloitte Australia advised Business Advantage PNG that the project went into a care and maintenance phase following Clough’s move into voluntary administration.

‘A team of Clough personnel and select subcontractors was retained to maintain security and safety of the worksite,’ says Deloitte Turnaround & Restructuring partner Glen Kanevsky.

Jobs and entitlements are intact

On 15 February, Deloitte Australia advised the market that arrangements reached with [Clough] creditors ensures that project principals and partners, ongoing employment-plus entitlements for over 1,000 staff, across recently-acquired Asia Pacific projects are retained.

Lihir mine shutdown project

Beyond Lombrum, Clough’s only other active project in PNG prior to entering voluntary administration, according to Deloitte’s, was Clough subsidiary e2o Asset Services’ Lihir mine shutdown project for Newcrest Mining.

Deloitte advises Business Advantage PNG that this contract ended late January 2023, with Clough and Webuild, the administrator adds, currently working with the client to determine the scope of any future work on the project.