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April 15, 2021
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PNG Biomass Questions Gov’t Over Delay in Constructing Power Plant

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By Julie Badui Owa – EMTV News, Lae

The PNG Biomass Project in Markham Valley, Morobe, is waiting for the Government to construct a promised power plant that will produce 30 Megawatts of biomass energy to the Ramu grid. PNG Biomass is a subsidiary of Oil Search Limited, who signed a power purchase agreement with PNG Power Limited in 2015, to generate 15 Megawatts of power through its Ramu Grid.

Project Manager, Michael Henson says they do not know why the government is delaying its progress, which is supposed to begin its first delivery of power by next year.

According to Mr Henson, the Biomass project in the Markham Valley of Morobe Province cost almost K600 million.

Henson said Oil Search and the Bank are prepared to invest in this project; however, they need to know if they are going to be paid by the Government for providing the electricity.

The project Manager told EMTV News that the funding requires a commitment from the government to stand behind PNG Power Limited and support the project.

The PNG Biomass Project in the Markham Valley of Morobe was established in 2010. In 2015, it was endorsed by the NEC and then in 2018, its power purchase price was approved by the Independent Consumer and Competition Commission.

The project is supported by a 25-year Power Purchasing Agreement that was signed with PNG Power Limited in December 2015.

Under the agreement, PNG Biomass will be supplying power to PNG Power and then PPL will retail it to users on the Ramu grid.

The Project has met all its requirements, including landowners benefits. The only delay is the final investment decision between the PNG Government and the Company.

According to the Landowners, under the agreement signed in 2015, the Government promised to bring 30 Megawatts of biomass energy to the Ramu grid, but that didn’t happen. The Landowners are demanding an answer from the Minister for Energy, Sam Basil and Treasury Minister, Charles Abel on the delay of constructing the promised power plant seven years ago.

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