Kikori’s Ihu Special Economic Zone has been allocated K100mil in support from the National Executive Council. Talks about the development partnership option are ongoing. The project is expected to boost the economy and improve lives of the locals, Business reporter PETER ESILA writes
THE National Executive Council has allocated K100 million for Kikori’s Ihu Special Economic Zone (Isez) project development for the next five years, according to MP Soroi Eoe.
Talks are on-going between the project development office and Government departments and agencies on development partnership options.
“The Kumul Petroleum Holdings Ltd, PNG Ports Corporation, Water PNG, National Airports Corporation and PNG Power have all expressed interest to develop the project,” he said.
“Discussions are also underway with superfunds.
“Standard project partnership memorandum of understanding will be signed to enable these institutions and companies to provide technical, commercial and management assistance to develop the project.”
The project site is located at Ihu in the Orokolo Bay of Kikori because of the easy access to resources including oil, gas, timber, fish, water, land for agriculture, sea and air transport, and economic regions in the Highlands, Western, Central and Port Moresby.
It also has access to international trading routes including to Australia, New Zealand, Indonesia and Asia – based on current routes and future ones.
“The site selected geographically starts in the east from Bluff Point to the mouth of the Purari in the west along the sea front,” Eoe said.
“From Bluff Point, it goes inland towards the headwaters of Vailala and to Purari and Wabo area.
“The geographically delimited area also includes surface and underwater.”
The site can be reached by air from Port Moresby, Lae and other airports. The Ihu Airport is less than an hour away from Madang, Mt Hagen and Tari.
The Isez will generate between K10 billion and K12 billion annually after the completion of stage one – that is for the first 15 years of the Isez being fully operational.
There will be much more expected thereafter.
Apart from the major business activities, the Isez project is expected to create small-to-medium enterprises with cottage service industries surrounding it.
It is expected to create up to 12,000 jobs directly and another 25,000 jobs indirectly.
“Kikori is also presumed to be the country’s economic frontier for the future, with its abundant petroleum resources, fisheries, agriculture, forest products such as timber, potential iron sands and coal mining and many others,” Eoe said.
“About 17.8 trillion cubic feet (TCF) of discovered proven economical gas reserves are in Kikori, which represent 80 per cent of the country’s total gas reserves of more than 19 TCF.
“My district currently hosts the Kutubu oil export pipeline and terminal, the PNG LNG project pipeline, and will soon host the country’s second LNG project, the Papua LNG project, and Pasca gas condensate project.
“These massive projects will no doubt make significant contribution to the country’s economic growth, increase the gross domestic product, create employment, boost growth in the small-medium enterprise (SME) sector, meet local and national content obligations, and improve livelihood through infrastructure development.
“While I applaud the Government’s policy initiatives to deliver infrastructure in the rural areas, for the benefit of the population, Kikori has, over the years, remained in dire need of basic infrastructure development to service more than 51,000 people.
“Basic services for the people have been denied mainly because there is no road linking it to mainland Kerema, no wharfs and jetties, lack of proper district towns, no serviceable airstrips, lack of clean water and power supply.
“The unavailability of these basic infrastructures had affected the district’s education system, health, SME activities, economic growth and human resource development.
“On the back of these setbacks over many years, the new district administration under my leadership has pursued forward planning and developed programmes for infrastructure development.
“The development of an integrated infrastructure development plan – the Kikori critical capital infrastructure project (CCIP) programme – is an achievable plan.
“The CCIP includes six infrastructure projects including:
- Deep water multi-user strategic port facility;
- New airport;
- New industrial urban town development;
- Water supply and reticulation system;
- Power generation and reticulation system; and,
- Ring road development connecting all CCIP facilities in Kikori and linking Kerema.
“The CCIP programme facilities will become the backbone infrastructure facilities to host the five major impact resource development projects.
“They are: the Papua LNG project development, Offshore Pasca gas development, Western LNG gas development, Gulf gas/industrial hub development and the Gulf free trade zone development.
“These six CCIPs are economic projects, strategic and multi-user facilities, strategically positioned to accelerate the delivery of government services as well as the development of the five IRDPs, once implemented.
“The CCIP facilities will be important in enabling the development of the billion-dollar Papua LNG project, Pasca gas project and other government projects such as the Gulf Industrial Hub project and Gulf free trade zone project.
“Such magnitude of development in Kikori will have a major impact on the lives of the people.
“The infrastructure will provide accessibility to basic government services for my people.
“Hence, the proposed development will also provide accessibility to commercial project operators such as Total SA E&P Ltd, Twinza Oil, Oil Search Ltd, ExxonMobil, logging companies and fishing companies.”