Energy is the great enabler of industrialisation of any country. And Papua New Guinea, I am pleased to say, has vast energy resource potential that dwarfs the 1500 MW required in total at the present time.
But immediately, there is electricity need of 600 plus MW for industries.
In this vein, I am pleased that Prime Minister O’Neill has highlighted that NEC endorsed Domestic Market Obligations policy is in place, which will no doubt greatly enhance domestic utilisation.
I am honoured that my colleague Minister for Petroleum Hon Dr Fabian Pok has stated that My Ministry will be in charge of distributing the Gas and LPG under the DMO Policy of Government.
I already have plans for use of gas for energy needs of the country for this so I welcome this announcement by my brother Minister.
As Minister responsible – and Trustee Delegate – of Kumul Petroleum Holdings Limited and Kumul Minerals Holdings Limited, I have already decided to ensure that most – if not all of the gas and LPG under DMO policy – will be used wholly or as energy mix for upcoming mining projects and domestic LPG usage. And also to support efforts by Department of Petroleum on petrochemicals.
I am mindful of the need for an LPG processing plant for power generation, industrial development and household use. And I will also be seeking investors to pursue this on a win-win arrangement.
The Government will pursue an agreement with the industry to source gas from current as well as future emerging gas projects to ensure a secure supply to meet gas demands for LPG Plant and power generations.
This is important to reduce the current high cost of LPGs in PNG – which is unfortunately one of the highest in the world. This is unnecessary for a country that produces gas and exports gas.
This is the reason why I want to see an LPG Plant in PNG so LPG gas is cheaply available to citizens and domestic users.
I am pleased to note that the gas to power generation initiatives by Kumul Petroleum Holdings and Oil Search, as well as Mineral Resources Development Corporation are at advanced stages.
These gas to power generation projects are based on the National Content Plan for power generation.
I would also like to see standalone power systems based in geographical locations of PNG and the naturally available energy sources. This includes readily available solar energy with PNG’s vicinity to the equator complemented by other sources like wind, geothermal, gas and others. This concept of energy mix is vital for Papua New Guinea for consistent power supply to industries utilizing standalone systems.
Now all this requires – and endorses the need for – a National Energy Policy.
I was surprised, as the Energy Minister, to discover when I assumed office that there was no Energy Policy. The closest policy in place was the Electricity Industry Policy of 2011.
That has been resolved now with the National Energy Policy 2017-2027 Harnessing Energy for Life endorsed by the NEC in February 2018.
The lack of a coherent and visionary policy on Energy has been the reason for lacks in creating a conducive environment for investment – and investment is required if we are to fulfil the need for 600 MW or more required by emerging major projects and industries as mentioned earlier.
The Energy Policy, endorsed by NEC, also directed the establishment of a National Energy Authority.