Puma Energy is Papua New Guinea’s largest fuel importer and operates the country’s only oil refinery. In this exclusive interview, Puma’s PNG Country Manager Hulala Tokome reveals how it is changing its business model in PNG.

Puma Energy’s Hulala Tokome

Business Advantage PNG (BAPNG): Where do you see the oil price moving over the next period of time?

Hulala Tokome: We saw a downward, aggressive move as many countries in Europe extended lockdowns and [introduced] movement restrictions to curb infections as well. This has instilled fears of slower demand recovery than previously thought. I think, for us in PNG, we are very much at the mercy of where the oil price fluctuates. Our impact is always a month lag.

BAPNG: What about volumes that are coming into the country at the moment, have they remained stable?

Tokome: Because of where the energy sector, or the power generation sector, has moved towards – into the LNG space – we have seen a decline in terms of volume for that sector. But we continue to maintain our crude orders. The big impact for us has been the aviation sector. Towards the end of last year, we were roughly around 50 per cent of where we were in pre-COVID levels. With the isolation that has already commenced, that is going to have another impact on our jet demand as well, because we supply 100 per cent of the jet fuel in the country.

BAPNG: Do you foresee any interruptions to supply as a result of the current COVID restrictions, or do you feel that you’ve got things under control now?

Tokome: The community transmission really had an impact – and I’m talking not only on our business but on other businesses as well. We have had our fair share of positive COVID cases. We’re swinging to actually having bubbles created to make sure that we maintain and sustain our operations in-country, especially for the refinery. That’s going to have a huge impact on our staff. Our business continuity plans had actually kicked in about three weeks ago. So, that’s ensured that we continue to maintain operations in country.

‘[We want to] become more like a one-stop shop energy solutions provider in-country.’

BAPNG: A lot of companies have had to shelve plans, or re-divert resources over the last 12 months in response to the COVID-19 pandemic, and the crisis it’s caused economically all over the world. You have had investment plans to upgrade and refurbish the Napa Napa refinery. Are they still on your long-term plans?

Tokome: That is still on our long-term plan. This year, we have got a very aggressive capex (capital expenditure) plan in place for not only the refining business, but also the downstream business as well. We are still positive and optimistic that we can get through those particular capex investments and upgrades to our facilities. [We want to ensure we have] a premium product in the market which differentiates us.

BAPNG: Where do you see Puma moving as far as your future plans are concerned?

Tokome: For us, it has been about making sure that we continue to sustain what we currently have in place. Our business model will be changing this year. We have also taken on our future energies business, where we are turning all our terminal facilities to being solar-generated as well. We are working alongside PNG Power for smaller sites that we supply diesel to – having solar as part of our future energies business, being able to provide solutions for those smaller townships, and being able to move away from the dependency on diesel.

If we don’t change our business model, we’re going to be left redundant in the market. It is important that we embrace the technological changes that are evolving around the world. It keeps us relevant to the market, and at the same time, yes, there is a place for hydrocarbons going forward. [We want to] become more like a one-stop shop energy solutions provider in-country.