Give local expertise a chance

 THE energy needs of Papua New Guinea cannot be underestimated.

The exciting developments driving the economic growth of this country 

depend, to a large extent, 

on the quantity and quality of energy supplies available.

Yet one of the paradoxes of PNG is that in a country so rich with rivers, there are no major hydro-generated energy sources. 

The Yonki hydroelectricity project supplying power to Lae, Madang and the 

five highlands provincial headquarters and the 

Rouna Hydro scheme supplying electricity to Port Moresby are the obvious exceptions.

With the unexploited potential of its large energy resources, PNG’s commercial energy needs are entirely met through the import of petroleum products. 

This situation is primarily due to insufficient efforts to define indigenous energy resources and the small and widely scattered nature of local energy markets. 

In a country where thermal activity is high, there have been no attempts to harness that resource to supply power. 

The same can be said for wind power.

PNG has been exporting crude oil since 1990 but it is a net importer of all its petroleum needs, including that which is needed to generate power in most major centres around the country.

It is now poised to export natural gas to power the industries of Japan, Taiwan, Korea and China. But there have been no studies conducted  to discover local energy needs.

PNG Power Limited (PPL) operates around 20 small independent power systems which serve about 27 urban centres.

Yet the infrastructure surrounding almost all these power systems are in dire need of upgrade and maintenance. 

Recently, when announcing the installation of up to 22 new high voltage transformers to boost power supply throughout the country, PPL chief executive Tony Koiri said it was only the second time a major equipment upgrade of the system was being undertaken.

Many transformers are more than 30 years old and under-rated therefore PPL had to replace these aged transformers. 

The installation programme is scheduled to begin in July this year and  is expected to be completed in November next year.

PPL will install nine transformers to boost supply to its Ramu grid covering the Highlands and Mamose regions, six in Port Moresby’s grid, two in the Gazelle grid and the remaining five will be held in stock as replacements in the event of damage to the existing transformers.   

While this is happening, the power needs of urban centres and resource projects would have doubled or trebled because generation capacity by PPL has remained stagnant or dropped.

Port Moresby alone, it has been said, needs at least 

an additional 120 megawatts of power. 

And that is additional to the power needs of the new Konebada Petroleum Park and the LNG site.

Expanding Lae city needs a similar amount of power outside of the maximum currently supplied by PPL.

Similar growth is expected in other major centres around the country.

All the resource projects happening around the country need huge amounts of power but since there is no capacity by PPL, each project has to outlay extra expenses to supply its own power. That burden could be removed if there was an alternate and reliable power supplier. 

This dilemma has not passed the notice of both the board and management of PPL and the government of the day.

Indeed, we hear on the grapevine of important meetings here and there by government and PPL to put together consortium to look at the power needs of PNG.

We hear too that a local consortium stands ready to enter this market with ready capital and capacity to source for more if the need arises in the near future.

This group comprises the superannuation funds and other national corporations.

It would be a silly decision to give contracts away to overseas corporations without taking a serious look at what is on offer by such a local consortium.

Far too much has been given away to foreign companies in the past and that is okay when there is no expertise on-shore to take up major contracts.

If such expertise and capital is available locally, that should be the first entity to be given a bite at the cake.