Papua New Guinea and Japan sign a Statement of Intent, PNG launches a National Energy Policy and potential changes to the way Kumul Petroleum Holdings and Kumul Mineral Holdings operate. The business news you need to kickstart your week.

Credit: Bismarck Maritime

Energy

Last week, PNG launched its National Energy Policy 2017–2027. Prime Minister Marape said in a statement that his government ‘aims to deliver electricity to 70 per cent of our people by 2025, when our nation celebrates 50 years of being independent.’ (PM Hon. James Marape)

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The policy will involve a ‘dedicated energy entity solely responsible for the development and implementation of National Energy Policy,’ according to Minister for Petroleum & Energy, Kerenga Kua. Kua also said that ‘the establishment of this entity is in progress with the draft national energy authority bill being substantially completed and will be submitted to the National Executive Council shortly.’ (The National)

Fisheries

Changes are being made to the Pacific Marine Industrial Zone (PMIZ) project in Madang. The PMIZ was under the Commerce Department but, according to The National, has been recently moved to the Finance Department and will come under the Special Economic Zone project, ‘with the Government to sign a Chinese Exim Bank loan agreement for the project.’ Rainbo Paita, Minister for Finance and Rural Development, reportedly said: ‘We are currently taking stock of what we have and what we should include in the new scope of work and then we will sign a new agreement with the Chinese Exim Bank.’

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Prime Minister Marape during the opening of the Alotau Town Market and Fisheries Project. Credit: FM 100

Prime Minister James Marape opened the K42 million Alotau Town Market and Fisheries Project. The market was funded by the Japanese government through the JICA Overseas Development Assistance Grant, with counterpart funding from PNG’s National Fisheries Authority in 2019. (FM 100)

Resources

Exxon Mobil paid the PNG government more than K2.2 billion in taxes, royalties and development levies last year from the PNG LNG project, but the expected amount for this year could be lower. Exxon Mobil’s Managing Director Andrew Barry reportedly said ‘unfortunately, gold [price] is very high, while oil and gas is very low, so the amount of money that the project will deliver to the country will be lower this year.’ (The National)

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During the next sitting of Parliament, an organic law on mining and petroleum will be introduced, reports The National. The law would allow Kumul Petroleum Holdings Limited (KPHL) and Kumul Mineral Holdings Limited (KMHL) to work more organically with the government ‘to achieve its vision to develop the country through resource exploitation’.

‘At the moment the Department of Petroleum and Energy controls those licences but with the new legislation, those licences will be transferred to Kumul Petroleum,’ KPHL’s Managing Director Wapu Sonk said. ‘This means that exploration, drilling exploitation, production, marketing and all aspects of oil and gas will be done through Kumul Petroleum, the single point of contact.’

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The Central Cement & Lime Project from Mayur Industries involves development of large scale, high-grade lime deposits.

Mayur Resources was awarded a 20-year mining lease for its Central Cement and Lime project in Central Province. (Business Advantage PNG)

Agribusiness

The National Development Bank and Enga Governor Peter Ipatas signed a memorandum of agreement to roll out a credit guarantee scheme. One million kina will be given to the bank for Engans to access funding for small businesses. ‘We are making the funding available for you [local people] to farm the land as a source of income and a healthy way of living,’ Ipatas said. (The National)

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PNG, through the Ministry of National Planning and Monitoring, has renewed its contract with Bismark Maritime Limited for the Freight Subsidy Scheme, a program that started during the first COVID-19 lockdown to support the shipping of fresh produce from Lae to Port Moresby.  (Post-Courier)

Banking

Bank South Pacific (BSP) announced its half year results for the year and recorded a consolidated operating profit after tax of K381.9 million (12.2 per cent lower than last year). Revenues across the group from foreign exchange income also saw a decline – from K160.8 million to K145.2 million. (PNGX)

Photograph of the week

Credit: FM100

Prime Minister James Marape and Japan’s Minister for Foreign Affairs, Tosihimistu Motegi, signed last week a Statement of Intent between the two countries. The Statement reaffirms the bilateral relations between both countries, includes area of mutual concern and recognises the importance of a expanding and strengthening trade and economic relations between both countries. (FM100)