Energy

The Independent Public Business Corporation is the implementing agency for a number of energy projects throughout Papua New Guinea. The following is a brief overview of the projects and

Purari Hydropower Project

Following NEC submission No NG 64/2012, Cabinet Decision No. NG200/2013 on 12th June 2013, approved the following:

  • The guiding principles and proposed delivery model;
  • IPBC to be the State Nominee and responsible for leading a State negotiating team on the structure and terms for development up to final investment decision; and
  • The establishment of SPV that will develop, operate and own the dam and generation assets.

PNG EDL as at 2012, had completed the detailed feasibility study pending:

  • Social and environmental impact assessment;
  • Further hydrology and sedimentation studies; and
  • Detailed engineering design of dam, generation system, transmission scheme, land access and off-take agreements

The study also revised the capacity of the project from 1,800 MW to 2,500 MW.

IPBC’s Key Deliverables for 2015:

  • Seek and follow State’s advice on arrangements with PNG Energy Development Limited (EDL)

Naoro Brown Hydropower Project

The project is currently at the stage of completing the detailed Feasibility Study by undertaking additional geological and geotechnical investigations during the 4th Q of 2014. This additional geological & geotechnical investigations include grout trials on the right of the dam site on Naoro River and 2 bore holes along the tunnel alignment.

IPBC’s Key Deliverables for 2015:

  • Consider implementation decisions during Q1 & Q2 2015 pending outcome of the additional geological and geotechnical investigation.

Ramu 2 Hydropower Project

The Full Feasibility study into Ramu 2 hydropower project commenced in June 2013 after a successful completion of a pre-feasibility study mounted in 2010, which strongly suggest for a full feasibility study. The first phase of the study (FEL1) covers feasibility and validation study (background reviews, and concept assessment. The next phase (FEL2) which relates to scope definition (site investigation/ Geotech investigation, and value engineering), and EIA are scheduled to be completed at end of September 2014, with the final Feasibility study Report set to be delivered to IPBC in October 2014. Financial analysis will proceed thereafter with an information memorandum to be completed by end of Q4 2014.

IPBC’s Key Deliverables for 2015:

  • Secure approval of project’s legal and commercial arrangements;
  • Finalise appropriate documentation and bid process;
  • Secure approval of preferred contractor;
  • Achieve FID and Commercial Close; and
  • Commence negotiation with stakeholders on land procurement for access road (permanent) to the power station.

POM Independent Power Producer (IPP) Project

The State decided in early 2014 that the Project is to be pursued 100% IPP by Energy World International (EWI) and for EWI to negotiate a PPA with PPL. PPL, in May 2014 suspended negotiations with EWI stating the following reasons:

  • High cost of IPP PPA tariffs based on LFO and uncertainty of gas;
  • State purchasing TM2500+ Gas turbines; and
  • State rejection of ICCC approved tariff increase

IPBC’s Key Deliverables for 2015:

  • Seek options for renegotiations (via gas use through NPCP) and promote efficiency of operations and better services through operations of two (2) Gas turbines in Lae and Port Moresby throughout 2015.

The State facilitated and funded the supply of two mobile General Electric TM2500+ gas turbines (ISO rating of 26.2MW) to add to the generation capacity of Port Moresby and Lae. The purchase price for the two gas turbines is K94million with total estimated project cost of K102 m inclusive of critical spare parts and PPL related installation costs. These gas turbines arrived at end of June 2014 and installation is in progress. The Port Moresby TM2500+ GT is expected to be operational in September 2014 while Lae TM2500+ GT is expected to be operational by October 2014.

Port Moresby Transmission Upgrade Project

A Consultancy Agreement was executed on 30 September 2013 between IAI and IPBC/PPL. IAI is a subsidiary of the LR Group of Israel. The consultancy services is being provided by LR, the Israel Electric Corporation (IEC) and IAI.

LR/IEC/IAI conducted a field survey in November 2013. The Survey Report submitted in February 2014. Project is currently at the stage where PPL has reviewed and finalising the list of equipment recommended by LR.

IPBC’s Key Deliverables for 2015:

  • Procure equipment and installation by 1st Quarter 2015.