Mayur says the PNG Energy Generation Solutions (PEGS) joint venture follows extensive collaboration, planning and scenario modelling since early 2018.
Mayur says the agreement's intended effect can now be realised following the recent publicly announced gas agreement signed between the PNG government and the Papua LNG project owners, led by Total.
"The Kumul-Mayur agreement sets a framework for the co‐ordinated development of Mayur's portfolio of projects in PNG, related to power generation such as its Lae Enviro Energy Park as well as its vertically integrated down‐stream processing facilities for cement and lime and other standalone energy/power generation opportunities.
"These additional energy/power generation opportunities that aim to replace higher cost, higher polluting imported liquid fuels (such as heavy fuel oil) exist in Madang, Lihir Island and elsewhere. The current and potential future demand in these centres (including Lae) is in the vicinity of several hundred megawatts," Mayur said.
Mayur says the agreement and the supporting Papua LNG project domestic market obligations (DMO) enable Mayur to factor the utilisation of fixed price DMO gas as a fuel source into its EEP power station project in Lae. This gas can be used singularly or in combination with coal, biomass in the same facility supporting the power and co‐generation steam supply along with use of solar. While Lae is located on PNG's east coast (away from the country's gas production infrastructure near Port Moresby) it is still many thousands of nautical miles closer than PNG's export customers in north Asia, such as Japan.
Conversely Mayur's Central Cement and Lime (CCL) project is immediately adjacent to the current PNG LNG and the proposed Papua LNG operations, and CCL's energy needs may be serviced via a short connecting gas pipeline.
"Negotiations with Fortune 500 energy companies wishing to partner across the development, construction and operations of energy/power related assets are continuing. The PNG Energy Generation Solutions Joint Venture will continue the dialogue with these parties with an endeavour to finalise arrangements within calendar year 2019."