KUMUL Review July 2016

Kumul Consolidated Holdings Limited 

HALF-YEARLY Review of KUMUL CONSOLIDATED HOLDINGS JULY 2016 

Our green future 

Hydro schemes set to power PNG 

• Ramu 2 Project commences 

• Karimui Dam feasibility study completed 

ALSO 

• First half highlights 

• Minister William Duma MP: acceptance speech 

• KCH: agriculture & fishing projects 

• POMSSUP: improved marine environments for POM 

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Front cover photo shows the headwater of the Ramu 2 project site. Photo by Parkop Karua. 


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Address by Hon. William Duma, LLB, LLM, CMG, MP 

Minister for Public Enterprises & State Investments 

This is my first address in The Kumul Review since being appointed Minister for Public Enterprises and 

State Investments on January 27, 2016. 

From the outset, I commend and acknowledge the efforts and contributions of my predecessor Hon. 

Ben Micah MP and the teams at both Kumul Consolidated Holdings Ltd and all the State Owned 

Enterprises for achieving important milestones in the areas of operations for many of our State 

Owned Enterprises. 

As Minister responsible, I ask myself these important questions: 

• what is the future of each individual State Owned Enterprise? 

• is a particular State Owned Enterprise performing to the expectations? 

It is incumbent upon each Chairman, Managing Director, Director and employee of each of the State Owned Enterprises to ensure 

that he or she performs competently and efficiently to achieve positive outcomes such that each State Owned Enterprise has a better 

future which we can look forward to. 

I am of the firm belief that our State Owned Enterprises by virtue of their unique positions in the industries they operate in, must 

provide the platform on which the PNG economy can be built upon into the next century for our children and grandchildren. 

We have focused on the energy sector, with developments in the Ramu 2 Project and an early feasibility study tabled on the Karimui 

Hydro Dam Project. These two projects are of vital importance to our developing country. They will bring prosperity and new 

opportunities never before thought possible. You can read more about these projects in the following pages. 

New roads, bridges, other infrastructure, jobs, and businesses will emanate from the many projects our State Owned Enterprises are 

involved in. This is certainly an exciting time for our people. 

We must not forget our stated ambition to provide electricity to 70 percent of all households in PNG by 2030. This again requires PNG 

Power Ltd and the rest of us to perform more efficiently than ever before. 

During the past six months, we have also seen significant developments in our agriculture and food projects. One notable example 

is the Sepik Plains Special Economic Zone which will see KCH joint venture with local companies to develop a commercial chicken, 

hatchery and egg farm. The 5,000 hectare land title will also be used to grow cocoa using new technology that will greatly improve 

the yield of each cocoa tree. 

Another project is the Pacific Marine Industrial Zone which is likely to provide employment for up to 30,000 people through either 

direct employment or associated enterprises. Adding to the viability of the project will be the PMIZ’s multi-function capability; being 

able to cater for large container and general cargo ships. The PMIZ will be a high class facility located in Papua New Guinea, providing 

exceptional tuna fish products to the rest of the world. 

At this juncture, I would like to remind ourselves that it is vital to national interests for our State Owned Enterprises to improve 

on their performances as companies competing in the private sector, strive to recruit the best of our young people, train them 

and develop them so that they become capable of working anywhere in the world, and more importantly, help our State Owned 

Enterprises consistently provide good financial returns to the shareholders, the people of PNG. 

Address by Mr Garry Hersey 

Managing Director, Kumul Consolidated Holdings 

When you read through the pages of our latest edition of The Kumul Review you will learn 

of projects that will have a profound effect on our economy and the position of Papua New 

Guinea within the region and the world. 

Such projects will propel Papua New Guinea into the 21st century and improve the quality of 

life for millions of people within the country. 

Improved employment prospects, improved infrastructure, improved trade, greater 

knowledge and more opportunity – and this will be achieved at minimal cost to the 

environment. We have called it our “green future.” 

By “green future” we mean a focus on renewable energy sources as can be found in our 

Ramu 2 and Karimui Hydropower Projects. Our “green future” also means a focus on food and 

agriculture as can be found in our Sepik Plains Special Economic Zone Project and the Pacific Marine Industrial Zone Project. 

It has been said that “food is the new oil and land the new gold”. Papua New Guinea’s national wealth and potential is further 

evidenced in its rich and abundant marine environments. It is our ambition to overcome various obstacles, whether they are 

geographic, economic or demographic, to achieve a better future for the nation of Papua New Guinea. 

A “green future” also means a “clean” future. On this note I can report that we have also made significant progress on the 

Port Moresby Sewerage System Upgrade Project (POMSSUP). 

In the following pages you will learn how we are on track to deliver this important project that will protect and reinvigorate 

the marine ecosystems around the coastline of our capital city. 

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Kumul Review July 2016 


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DECEMBER 9, 2015 Launch of the Ramu 2 Hydro Project, Kainantu, 

Eastern Highlands Province. See pictorial pp 8-11 

JANUARY 27, 2016 Handover of the Department of Public 

Enterprises and State Investments Ministerial portfolio. See pp 4-7 

JANUARY 29, 2016 Presentation of the Karimui Hydro Dam 

Feasibility Report. See story pp14-15 

FEBRUARY 18, 2016 KCH was a proud co-sponsor of the Small to 

Medium Enterprise (SME) Policy and Master Plan launch. 

FEBRUARY 19, 2016 Minister William Duma hosted a luncheon to 

meet heads and board members of KCH and the SOEs. 

THURSDAY MAY 5, 2016 Three proponents shortlisted for the 

Ramu 2 Hydropower Project. See full story pp 12-13 

JANUARY 1, 2016 WE MOVED! KCH started the year with a change of scenery. We are now located on level 3 of the new Harbourside West 

Building in Port Moresby. We also migrated our website from IPBC to KCH. You can now find us at www.kch.com.pg 


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Time for change 

To everything there is a season. And on Wednesday January 27, 2016 the time had come for Hon. Ben 

Micah to hand over the portfolio of Public Enterprises & State Investments to Hon. William Duma as part 

of a cabinet reshuffle by Prime Minister Peter O’Neill. 

The handover came less than two months after the launch of Kumul Consolidated Holdings on 

December 1, 2015 – a milestone that capped a brilliant term by Minister Micah. 

The job done, it was time for Minister Micah to move to the portfolio of Petroleum & Energy. 

But as the incoming Minister Duma pointed out “I don’t think you’ve left the State Owned Enterprises 

or that you’ve left this Ministry – we’ve just changed titles.” 

And as Minister Micah observed “The Prime Minister has aligned both of us in areas where we 

complement each other.” 

Here is how the event unfolded with both Ministers complementing - and complimenting - each other. 

Photography by: Isaac Tauno 

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10:49 

WEDNEsday JANUARY 27, 2016 

Minister Ben Micah and Minister William Duma make their way toward the 

Ministerial handover function at Crowne Plaza, Port Moresby. 

Kumul Consolidated Holdings Chairman Paul Nerau and KCH Managing Director 

Garry Hersey follow. 


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A JOB WELL DONE: To commemorate Minister Micah’s term of office Chairman of KCH Mr Paul Nerau and Minister Duma presented Minister 

Micah with three frames - one featuring the launch of Kumul Consolidated Holdings; another featuring the Lae Port Project; and a third frame 

containing his final speech as Minister for Public Enterprises and State Investments, made at the launch of KCH on December 1, 2015. 

Speaking at the handover ceremony at the Crowne Plaza 

Hotel, in front of a capacity audience that included the heads 

of the State Owned Entities, Chairman of KCH Paul Nerau 

said: 

“Minister Micah successfully implemented the Kumul 

agenda; he facilitated the move of the Port Moresby Wharf 

to Motukea and the expansion of the Lae Wharf which will 

allow for the further expansion of the PNG economy. His 

contribution to Papua New Guinea has been monumental.” 

“It was less than two months ago we celebrated the launch 

of Kumul Consolidated Holdings – a milestone that capped a 

brilliant term by Minister Micah.” 

On handing over the portfolio Minister Micah said to Minister 

Duma: 

“I will be handing over to you an area that is not new to 

you. You yourself a very successful lawyer, you come from a 

business background, you were involved with me already in 

the Privatisation Commission, the PNG Harbours Board, the 

PNG Ports Corporation, and I believe that this is not going to 

be a new thing for you.” 

“I totally trust you and believe that you will rise up to the 

occasion to take these companies (the SOEs) that are 

no longer sick babies, they are robust strong companies 

now with very capable Board members and very capable 

management teams. 

There is a wealth of Papua New Guinean people out there 

waiting to enter the workforce and now they have an 

opportunity to work in Telikom, in Air Niugini, in Ports… 

getting much better pay in State Owned Enterprises than 

they would in the private sector, had we not helped these 

companies grow into the success that they are today.” 

“I can speak very confidently that you will provide the same 

level of professionalism and the same level of leadership. 

The Prime Minister has aligned both of us in areas where we 

will complement each other. I will be counting on you and 

your knowledge and your experience in the Petroleum and 

Energy Ministry and I am sure likewise you will consult me 

when needed.” 

The handover follows the recent appointment of Hon. Ben 

Micah as Minister for Petroleum and Energy. 

Hon. William Duma was formerly the Minister for Transport and 

Infrastructure. He is a long-standing Member of Parliament 

under successive governments and once held the office of 

Minister for Petroleum and Energy. 

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‘I will continue the good work’ 

Edited transcript of Hon. William Duma’s acceptance speech. 

Wednesday January 27, 2016 

I’d like to simply acknowledge and commend and thank our 

Prime Minister, the Honorable Peter O’Neill for recognising 

the rare qualities of the outgoing Minister Honorable Ben 

Micah and for having made the very important decision to 

appoint him to this very, very important and challenging 

portfolio – one of the most challenging portfolios in the 

country. 

I would also like to commend the Prime Minister and thank 

him for allowing me this opportunity to continue the very 

good work that has been carried out by my brother and 

Minister Ben Micah. 

Let me say this (to Minister Micah). I have known you for a 

very long time. You are a reformer and you are a visionary. 

When the Governments of the day in the past were talking 

about much-needed reforms to the provincial government 

system, you put your hand up and you wrote the agenda and 

as a result – and not many of us would know – but I do know 

that this was one of the factors that led to you losing your 

seat of Kavieng Open. You made up your mind and you were 

of the view that it was in the interest of the country – you took 

the risk and you lost. But the people of Kavieng were much 

wiser and decided to bring you back. And I don’t believe for 

once they made a mistake. 

You were also at the forefront of the Government’s agenda 

to reform our State Owned Enterprises and at that time 

you were the First Executive Chairman of the Privatisation 

Commission and in many ways you were my boss when I was 

Chairman of Ports Corporation. 

So these are small praises Honorable Ben Micah. I don’t think 

you’ve left the State Owned Enterprises or that you’ve left this 

Ministry – we’ve just changed titles. As you know Minister 

Micah in Cabinet I have always been one of your supporters. 

There was only one occasion when I had some strong views 

about your decision to relocate the wharf (from Port Moresby 

to Motukea) but in hindsight I admit you were right and I was 

wrong. 

As you know I have always been there for you and you are 

just a phone call away. You have given a very solid three and 

a half years with this very important organisation. I have only 

one and a half years to do it. You have left me with a strong 

structure, very good people, and good boards. 

My view is that in a country like Papua New Guinea our 

State Owned Enterprises are very, very important and if we 

were to ignore them it would be at our own peril. Papua 

New Guinea is a unique country, as you all know. Unlike 

countries in Europe such as France, England, Germany, Spain 

and Italy who have one common language per country, one 

culture, they understand each other; we in this country have 

more than 800 different languages, more than a thousand 

tribes, many cultures. In effect we are so many different 

countries all living under one country. That in itself can be 

a strength but in terms of development it can prove to be 

a major obstacle. When you have so many different views 

from so many different ethnic groups who react and think 

differently it is in fact one of the most difficult countries to 

run on Earth – yet many don’t seem to recognise this. When 

our foreign friends blame us and point fingers and remind us 

of all the statistics they overlook the fact that we are many 

different countries living under one roof as wan kantri. We 

have actually demonstrated that we are smarter than most 

of them. Again, that is also reflected in the way our SOEs are 

run. They are also made up of people from different cultures, 

a different way of thinking, yet we all try our best to run the 

SOEs for the interests of our people. 

There is frankly speaking nothing much for me to do in the 

remaining one and a half years. I can only think of continuing 

the good work that you (Minister Micah) have done, 

consolidating everything that you’ve done. If there are any 

weaknesses that we all identify, then we will try and work on 

them. And of course, I will still call on you and pick your brain 

– maybe a bigger brain. 

As I said earlier, I do not plan to reinvent the wheel. For me it 

will be very challenging but the bulk of the work has already 

been done by Minister Ben Micah and the current Boards and 

Management and I intend to consult each and every one of 

you. We will maintain the status quo until the elections. 

Minister William Duma addresses the audience at the handover ceremony held at Crowne Plaza Hotel, Port Moresby. In the audience are Board 

Members of KCH and the SOEs, along with senior management and members of the media. 


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OUR GREEN FUTURE 

RAMU 2 HYDRO PROJECT LAUNCH: Wednesday December 9, 2015 

For the thousands of people congregated in Kainantu to witness the launch of the Ramu 2 Hydropower project on 

Wednesday December 9, the arrival of the Minister for Public Enterprises by helicopter heralded the beginning of an 

era of green power in Papua New Guinea – an initiative that would expand the potential of the country in a way never 

before imagined. 

With the Minister came the announcement of the commencement of the Ramu 2 project – a project that is expected to 

increase the existing Yonki Dam electricity capacity by 194%. 

The Ramu 2 Project coupled with the Karimui Dam Project will have a profound effect on the future of our country. 

Harnessing power from water - renewable energy - is a win for the environment; and a social and economic win for the 

people of the Eastern Highlands and Morobe Province and a win for Papua New Guinea. 

Here is how the day came down. 

Learn more: www.kch.com.pg/minister/launches/project 

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08:33 

Wednesday December 9, 2015 

Air Niugini charter arrives at Goroka. KCH Chairman Paul Nerau leads the delegation of the Boards and heads of SOEs; KCH senior 

management, invited guests and the media as they make their way from the aircraft to a convoy of PMVs that will transport them to 

Kainantu. Meanwhile a large crowd gathers at the Kainantu playing fields in preparation for the event. 

10:40 


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10:57 

wednesday 

December 9, 2015 

Faces in the crowd. School children join the large crowd gathered in Kainantu, proud 

Highlanders dressed in traditional bilas, and others showing their patriotism during the historic 

launching of the project. Local school children then sang the National Anthem of 

Papua New Guinea at the commencement of the Official Program. 

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12:33 

KCH Chairman Paul Nerau delivers his speech ahead of Member for Kainantu Hon. Johnson Tuke, 

Governor for Eastern Highlands Julie Soso and then the keynote address by Hon. Ben Micah. 

15:18 

17:09 

Group photograph followed by a media conference at the end of the Program. 

wednesday December 9, 2015 

The long road home. A short stop for a group photograph to 

celebrate the natural beauty of the Papua New Guinea highlands. 

Later that day... DRAFT LOGO 

21:46 Time to go home at the end of a long and historic day. Back to work in the morning. 




RAMU 2: PROGRESS UPDATE 

Thursday May 5, 2016: Kumul Consolidated Holdings (KCH) today released details of progress on the Ramu 2 Hydropower 

Project, a proposed 180MW hydroelectric power station on the Ramu River. 

The Project was launched on Wednesday December 9, 2015 in Kainantu in the Eastern Highlands Province. Since then 

KCH has focused on Phase 1 of a three-phase transaction management process, seeking Expressions of Interest (EOI) from 

suitably qualified development partners to develop the project and operate under a Public-Private Partnership (PPP) 

model. 

Speaking at the KCH media conference, Minister for Public Enterprises & State Investments Hon. William Duma said: 

“Kumul Consolidated Holdings is following a process of full transparency and due diligence. For a project of this size such 

processes, while time consuming and thorough, are mandatory. Inevitably we will be in a position to give the National 

Executive Council a detailed, thorough and informed recommendation regarding the Ramu 2 Project.” 

Minister Duma thanked all parties who responded to the call for Expressions of Interest (EOI), in particular the shortlisted finalists. 

Minister Duma also thanked and commended the Kumul Consolidated Holdings Ramu 2 Project team on the thoroughness 

and professionalism of the EOI process and expressed full confidence in the team during future transactions and processes. 

Minister Duma also thanked all those that attended the media conference, and was honoured to have the presence of 

Hon. Charles Abel, Minister for National Planning. 

TOP THREE SUBMISSIONS 

The assessment process ultimately saw 7 EOI submissions 

reduced to the top three. The process rated each proponent 

based on a number of factors related to their capability and 

understanding of the project. 

The top three proponents were: 

• Posco Daewoo, Korea Western Power, Daelim Energy, 

Hyundai Engineering Consortium 

• Sinohydro Corporation Limited 

• Shenzhen Energy Group Co. Ltd 

NEXT STEPS 

The next steps in the three-phase process is for KCH to issue 

a Request for Proposal (RFP) from the top-three proponents 

and then as the final phase close the financial arrangements 

for the Project. 

The milestones are as follows: 

• Request for Proposal (RFP) issued: May 6, 2016 

• Closing date of RFP: October 28, 2016 

• Announce preferred development proponent: Dec, 16, 2016 

• Close of financial arrangements: March 2017 

Thursday May 5, 2016: Minister Duma addresses the audience at the 

Ramu 2 Media conference. 

KCH Managing Director Garry Hersey makes a point during the media 

Q&A session. 

Minister Duma and KCH Chairman Paul Nerau congratulate KCH Ramu 2 

Project Director Parkop Karua 

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Minister Duma (centre) with Minister Charles Abel and 

KCH Chairman Paul Nerau 



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ABOUT RAMU 2 

Ramu 2 is a major infrastructure project being managed 

by Kumul Consolidated Holdings (KCH). The project site 

is located downstream from the existing Yonki Dam and is 

capable of generating 180 megawatts (MW) of renewable 

energy. 

It is expected to lift Yonki’s electricity capacity from the 

current 93MW (once all major refurbishment and upgrade 

works are completed) to 273MW, an expansion of 194% in 

the scheme’s generation capacity. 

More significantly, Ramu 2 is expected to increase total 

electricity generation capacity in Papua New Guinea by 36% 

by way of a low-cost renewable source. 

The development of the Ramu 2 project is in line with the 

PNG Development Strategic Plan 2010-2030 which outlines 

the following priorities: 

• increase household access to electricity from the current 

12% to 70% by 2030; 

• provide a national grid to increase reliability of electricity 

supply across the country; 

• provide a secure, renewable energy base for the PNG 

development pathway; 

• reduce energy costs through greater hydropower 

development; and 

• deliver on the Government’s commitment to support 

mining and industrial developments within the Highlands 

and Momase regions. 

The scope of the Ramu 2 project includes a new 471,000m3 

storage facility; three 61MW turbines; 30km of new 

project access roads; 7km underground headrace tunnel; 

powerstation; 12km of new 132kv transmission lines; and 

various other temporary works. 

KCH has engaged the services of a Golder / Tanorama Joint 

Venture (JV) to undertake an extensive Environmental & 

Social Impact Assessment (ESIA) and Environmental & Social 

Management Plan (ESMP) to comply with CEPA international 

standards such as the Equator Principles and Performance 

Standards. The JV will also have carriage over all land access 

requirements and landowner management on behalf of KCH. 

Ramu 2 will be based on a public-private partnership (PPP) 

model which, for the first time, will see traditional landowners 

also assume equity in the project. 

KCH has already achieved a number of milestones in the 

project, including a detailed feasibility study (February 

2015), and more recently selected expert transaction & legal 

advisors to support the project. KCH is also in the process of 

finalising the transaction structure to best attract a first class 

private sector development partner. 

KCH also laid the foundation for on-going developments in 

the Project with the appointment of Norton Rose Fulbright as 

a legal advisor and the Golder & Associates/Tanorama JV as 

environmental and land management advisors. 

Advisian was appointed as Transaction Advisor on the Project 

and has recently acted in the capacity of EOI Process Manager. 

All advisory appointments were made following an extensive 

advertising and procurement process. 

Artist’s impression of the Ramu 2 Hydropower Plant 


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KARIMUI HYDRO PROJECT FEASIBILITY STUDY 

During the last month of 2015 and the first month of 2016, 

two important milestones were achieved that will shape the 

future of Papua New Guinea. 

On Wednesday December 9, the Ramu 2 Project was 

launched - a project that is expected to increase the existing 

Yonki Dam electricity capacity by 194%. It was to be one of 

the final achievements of Minister Ben Micah during his term 

as Minister for Public Enterprises and State Investments. 

The other milestone came immediately at the start of Minister 

Duma’s term – the completion and presentation of the 

Karimui Hydro Dam Project Feasibility Study on Friday January 

29, 2016. 

The Karimui Hydro Dam Study follows a Memorandum of 

Understanding - between the Government of Papua New 

Guinea, the Simbu Provincial Government and Italian 

company Salini Impregilo - which came in to effect on May 

8, 2015. 

Salini Impregilo is a global industrial giant with over 100 years’ 

experience in the construction of major, complex projects 

such as dams and hydroelectric plants, hydraulic works, 

railways and metro systems, airports and motorways. 

Salini Impregilo is especially recognized as a world leader 

in the construction of infrastructure projects in the water 

sector, having built 257 dams and hydroelectric plants. The 

company is currently involved in the development of the 

Grand Ethiopian Renaissance Dam, one of the most complex 

and ambitious infrastructure challenges in the world, which 

will be the largest dam in Africa with a total installed capacity 

of 6,000 MW and an average estimated production of around 

15,700 GWh/year (see story opposite page). 

In the Karimui Hydro Dam Feasibility Study, Salini Impregilo 

highlights challenges that go beyond construction of the 

dam including the building of road and bridge infrastructure 

throughout Simbu province leading up to the dam site to 

facilitate construction activities. This will include the upgrade 

and replacement of 42 bridges between Lae and the site. 

The study also covered other aspects of the proposed project 

including social and environmental considerations. 

The installed capacity of the Karimui Hydro Dam Project 

is 1,800MW which will make it by far largest and most 

ambitious hydro-power scheme in Papua New Guinea to 

date. Construction is expected to commence in 2017 and be 

completed by 2023. 

Both the Ramu 2 Project and the Karimui Hydro Dam Project 

are part of the PNG Development Strategic Plan 2010-2030 

which outlines the following priorities: 

• increase household access to electricity from the current 

12% to 70% by 2030; 

• provide a national grid to increase reliability of electricity 

supply across the country; 

• provide a secure, renewable energy base for the PNG 

development pathway; 

• reduce energy costs through greater hydropower 

development; and 

• deliver on the Government’s commitment to support 

mining and industrial developments within the Highlands 

and Momase regions. 

It is significant that both events involved hydro projects, with 

renewable energy as a way of powering Papua New Guinea 

into the future. A win for the environment and a win for the 

people of Papua New Guinea. 

Mr Garry Hersey, Managing Director of Kumul Consolidated Holdings (centre) being presented with the Karimui Hydro Dam Feasibility Study by 

Mr Leopoldo Carlesimo, Executive Director, Salini Impregilo during the presentation at the Grand Papua Hotel on Friday January 29, 2016. 

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The Karimui Hydro Dam Project 

A visionary plan to address PNG’s energy challenge 

The following are excerpts from the Feasibility Study Executive Summary 

Background 

The move towards a Feasibility Study began in November 

2013 when the Simbu Province Governor and Salini lmpregilo 

entered into a Memorandum of Understanding (MOU) to 

study the development of a 1,800MW hydroelectric dam 

project at Karimui, Simbu Province. 

The MOU received constructive input from the National 

Executive Committee and was endorsed by the Minister for 

Public Enterprises and State Investments and the Minister for 

Treasury. 

On May 8, 2015 the MOU came into force requiring Salini 

lmpregilo to deliver a Project Feasibility Study, based on a 

Build Operate Transfer (BOT) structure. 

Outcome 

The Project Feasibility Study concludes that the Project will 

provide significant benefits to Simbu Province and Papua 

New Guinea in the following key ways: 

1. Power to support national economic growth 

PNG’s Gross Domestic Product (GDP) expanded 8% in 2014 

supported by mining and construction activities. Forecast 

economic growth is predicted at around 4%, but this growth 

figure, provided sufficient electrical power is available, 

may substantially be revised upwards. The Project, with its 

proposed 6 year construction period, will be delivered in 

time to provide up to an additional 1,800MW of sustainable 

growth-generating power. 

2. Project location in an uninhabited area close to 

construction materials 

The Project is located in the Simbu Provence, upstream of 

the Wahgi and Asaro junction on the Wahghi River side. The 

ETHIOPA’S GREEN REBIRTH – A MODEL FOR PAPUA NEW GUINEA 

The Grand Ethiopian Renaissance Dam (GERD) Project is Salini Impregilo’s most challenging fast-track project. The site is 

located 700 kilometers northwest of Ethiopia’s capital Addis Ababa along the Blue Nile. The impounded reservoir will 

cover an area of 1,874 square kilometers and once completed, it will be the biggest dam in Africa, producing a massive 

6,000 MW of electricity for the country and its neighbours. 

Compared to the Karimui Hydro Dam Project with its installed capacity of 1,800MW, the GERD at 6,000 MW is a giant. 

Nonetheless, the Karimui Project is just as challenging, and the 

rewards just as great. 

In a recent interview the Ethiopian Prime Minister Hailemariam 

Desalegn said his country was living a “green” rebirth. This is 

partly thanks to the GERD, where 9,000 people are working at 

full speed to complete the project by 2017. The dam will enable 

Africa’s second most populous country– where 77% of its 

people don’t have access to electricity and other basis services 

– to power its growth with the production of renewable 

energy. Ethiopia has the aim of becoming carbon-neutral as it 

works towards becoming a regional economic power. 

Similar fortunes await our country with both the Karimui Hydro 

Dam Project and the Ramu 2 Hydro Project working in tandem 

to power Papua New Guinea into the twenty-first century. 

advantages of this location include: 

• no known habitation of the catchment basin reduces social 

impact concerns; 

• suitable construction materials can be sourced locally 

reducing transportation impacts on roads; and 

• the natural drop distance from the Wahgi River power 

intake to the power house on the Tua River is about 5OOm 

which ensures excellent power generation performance. 

3. Upgrade and expansion of national infrastructure 

The Project’s remote location means road upgrades between 

the Port of Lae and the dam site will improve the Lae- 

Goroka-Chuave highway as well as other ancillary roads. 

These visible road refurbishments will benefit permanently 

the people of Papua New Guinea as well as support further 

economic activity. 

4. Employment and high skill jobs 

The Project, including the Port of Lae and road upgrades, 

is a significant infrastructure project on a global scale. At 

the peak of construction (during the 6 year development 

phase) several thousand people will be employed including 

construction workers and foremen as well as professional 

engineers and specialists. A large portion of this work force 

will be PNG nationals who will have the opportunity to acquire 

technical and infrastructure development knowledge. 

5. Secondary economic activity 

The Project will generate secondary demand for goods 

and services including: transportation, importation 

of construction materials, work for local construction 

companies, security services, general suppliers and 

engineering and consulting services. 

Photo courtesy of Salini Impregilo image library 


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Kch: harvesting agriculture projects 

FOOD FOR THOUGHT 

Approximately 795 million people in the world currently 

don’t have enough food to lead a healthy, active lifestyle, 

according to an estimate by the World Food Program. 

And by 2050 the global population could go from 7.2 

billion to 9.6 billion. 

It is also estimated that between 2005 and 2030, the 

amount of arable land available per capita in the world will 

shrink by almost 20%. 

With that in mind, Papua New Guinea has the potential 

and the pedigree to be the food bowl of the Asia-Pacific 

region. After all, growing food is what Papua New Guinea 

has been doing for thousands of years. 

Our Highlands are abundant with food crops and some of 

the best arable land in the world. At Kuk near Mt Hagen in 

the Western Highlands Province there is PNG’s only world 

heritage site - archaeological evidence of importance to 

humanity that 10,000 years ago the Highlands people 

were among the first gardeners in the world. 

Download Minister Micah’s speech: www.kch.com.pg/ipbc-library/publications 

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It is not surprising to learn that Kumul Consolidated Holdings 

(KCH) is now considering a number of agriculture initiatives, 

ranging from small joint ventures to massive infrastructure 

projects. Projects that complement each other. Synergies that 

benefit our people and protect our environment. Projects 

that work across multiple agencies and departments. 

In the world today, it all makes perfect sense. 

According to Managing Director Garry Hersey, KCH is 

perfectly positioned to be the implementing agency for 

agriculture and fishing projects in Papua New Guinea. 

Although many are still in their infancy, Hersey identified a 

few projects that KCH is now actively pursuing. 

Including: 

• major investments in palm oil and tropical fruit in the 

Islands and Central regions for export to Asia; 

• projects to improve yield of crops in the Highlands, the 

establishment of cooperatives and the facilitation of produce 

to market, especially through the improved transport 

infrastructure to the port of Lae that will allow for further 

transport to national and international ports; 

• a Sepik Plains Special Economic Zone project that will see 

KCH joint venture with local companies in the Yangoru- 

Saussia District to develop a commercial chicken, hatchery 

and egg farm. The 5,000 hectare land title will also be used 

to grow cocoa using new cutting-edge technology that will 

improve the yield of each cocoa tree by 400-500%; and 

• the further development and protection of our fishing 

industry through the establishment of the Pacific Marine 

Industrial Zone (PMIZ) (see story below). 

“Apart from being involved in projects and joint-ventures 

we are also looking to improve yield and efficiencies by 

exploring and developing models that provide cost-effective 

access to domestic and international markets,” Hersey said. 

“The projects will have huge benefits for small-holders, and 

small to medium enterprise. They will help propel Papua New 

Guinea on the road to a sustainable economic prosperity.” 

“To achieve favorable outcomes we look forward to working 

closely with other departments and agencies, as many of the 

projects are broad-ranging and have environmental, social 

and economic implications,” he added. 

PACIFIC MARINE INDUSTRIAL ZONE (PMIZ) 

The PMIZ project has been placed under the control and 

management of Kumul Consolidated Holdings by the 

National Executive Council, reporting to the Minister 

for Public Enterprises & State Investments Hon. William 

Duma. KCH has the resources to ensure that the PMIZ is 

delivered as a transformational project for the Madang 

province and PNG. 

The Pacific Marine Industrial Zone was first initiated by 

the National Fisheries Authority and Fishing Industry 

Association in 2006. 

The project was finally launched in November 2015 

and announced as a joint venture between Kumul 

Consolidated Holdings and the Madang Provincial 

Government. 

The PMIZ is located approximately 23km by road north 

of Madang. It is intended to cater for up to 10 tuna 

fishing and processing canneries, which will underpin the 

government’s policy direction of moving away from only 

licencing fishing to more onshore processing. 

This strategic move could employ up to 30,000 people 

through either direct employment or associated 

enterprises. Adding to the viability of the project will be 

the PMIZ’s multi-function capability of being able to cater 

for large container and general cargo ships. The PMIZ will 

be a high class facility providing exceptional tuna fish 

products from Papua New Guinea to the rest of the world. 

The size of the project is 100 hectares for the industrial 

zone and 115 hectares for residential and commercial 

purposes. 

A Commencement Order for construction of Phase 1 of 

the PMIZ project was issued by the Department of Trade 

Commerce & Industry on Thursday April 7, 2016. The 

Order, with a value of US$95 million was issued to China 

Shenyang International Economic & Technical Cooperation 

Corporation Limited (CSYIC). Funding is currently being 

sourced by the PNG Government. 

Following on, CSYIC will commence work and Phase 

1 is expected to be completed within 33 months. KCH 

will be seeking other private sector involvement for the 

remainder of the project. 

CSYIC is very experienced in similar large scale projects 

and has been associated with the PMIZ project for many 

years and to date has clearly demonstrated a commitment 

to achieving success in the project. 

Tuesday November 24, 2015 : 

Launch of the PMIZ attended by Prime Minister Peter O’Neill 

Artist’s impression of PMIZ Phase 1 


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p17 



OUR CLEAN FUTURE 

POMSSUP construction phase on target 

A green future also means a clean future. 

Kumul Consolidated Holdings has partnered with Eda Ranu, contractor Dai Nippon-Hitachi JV, engineer NJS Consultants, with 

financial backing from JICA (Japan International Cooperation Agency) to deliver a project that will improve the health and 

quality of life of thousands of people in the national capital of Port Moresby. 

The Port Moresby Sewerage System Upgrade Project (POMSSUP) is on track to clean-up our coastal environment. 

Special report by Baeau Tai, 

Public Relations Officer, Port Moresby Sewerage System Upgrade Project ( POMSSUP) 

The month of April 2016 ended on a colourful note for Port 

Moresby Sewerage System Upgrade Project (POMSSUP) 

amidst the hive of construction activities at the Joyce Bay 

project site in Kilakila. 

On Friday April 29, principal contractor Dai Nippon – 

Hitachi JV organised a safety ceremony for all stakeholders 

involved in the project. The POMSSUP team together with 

staff from Project Engineer NJS, sub-contractors and other 

invited guests converged at the project site to celebrate the 

occasion. 

Vaga landowners of Kilakila village took an active part in the 

ceremony by providing catering and music to set the mood 

for the occasion. 

The safety ceremony marked the traditional acceptance of 

the government’s key infrastructure project, POMSSUP on 

Kilakila land. This was evidenced in the “killing of a pig” that 

demonstrated in the Motu Koitabu culture trust and respect 

for the project and for all stakeholders including the local 

communities. 

“The killing of pig signifies our respect for the land in which 

the project stands and we pay homage to our ancestors,” 

Chairman of Vaga Incorporated Land Group (ILG), Goasa 

Geita said during the ceremony. 

Dressed in colourful traditional bilas, Mr Geita told the 

gathering that the landowners would work together to move 

the project forward until its successful completion in 2018. 

Notable achievements in the journey towards construction 

phase in the first half of 2016 are: 

• the installation of three Project Signboards at the access 

road in front of Kilakila Primary School, Konedobu Pump 

Station in the vicinity of the Waterfront Shopping Mall and 

Joyce Bay project site; 

• commencement of STP site earthworks; 

• pipeline works from Seapark at Paga Point (soon to 

commence). 

p18 



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Learn more: pomsSup was featured in the July 2015 edition of The IPBC Review 

Available as an e-magazine at: www.kch.com.pg/ipbc-library/publications/ipbc-review-july 

In October 2015 the much-anticipated contract award 

signing eventuated between contractor Dai Nippon – 

Hitachi JV and the government of Papua New Guinea 

in Tokyo, Japan with our Prime Minister Peter O’Neill 

there to witness the signing. 

The project scope will initiate construction of the 

sewer network, the rehabilitation of 9 pump stations, 

the construction of 4 new pump stations and a state 

of the art, sewerage treatment plant (STP) at Joyce Bay. 

This system upgrade will keep the sewage out of 

waterways and protect the marine ecosystem. This 

upgrade will also restore coastal water that is currently 

unusable because it is polluted. 

In preventing discharge of untreated sewage into the 

ocean, the maritime environment is protected thus 

improving the diversity of the coastal eco-system 

which will in turn uplift commercial fishing and 

recreational development potential. 

The STP is designed to the highest international 

standards and will service the coastal area of Port 

Moresby with capacity for future expansion. It will be 

the largest wastewater treatment facility in the South 

Pacific. 

This is a milestone achievement for KCH as it manages 

POMSSUP as a key-impact government infrastructure 

project with the aim to improve hygiene and sanitation 

for Port Moresby coastal residents and improve the 

coastline marine system. 

For Port Moresby city residents living along the coast, 

the sewerage upgrade will go a long way to improving 

their lives. 

Expected completion date is September 2018. 

(L-R) Chairman of Vaga landowner company of Kilakila, Goasa Geita 

sharing a moment with POMSSUP Project Director, Craig Mecklem 

and Project Manager, Aloysius Aihi during the safety ceremony. 

POMSSUP Team in front of the new project sign board at the Joyce Bay 

construction site. 


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iStock.com/ Tatiana Belova 

p19 



Vision.Mission.Values. 

Unchanged. Shared. 

RELIABILITY 

LEADERSHIP 

& EXCELLENCE 

EFFICIENCY 

GOOD 

CORPORATE 

GOVERNANCE 

VISION 

To enhance and transform all 

State Owned Enterprises to deliver 

premier services and economic returns. 

MISSION 

To steer the holding entity and its 

respective SOEs to become profitable 

organisations; delivering reliable, 

whilst adhering to good corporate 

governance and best practice. 

BEST PRACTICE 

INTEGRITY 

& PASSION 

PROFESSIONALISM 

PROFITABILITY 

VALUES 

VALUES 

IPBC’s 

Kumul 

unifying 

Consolidated 

values 

Holding’s 

of integrity, 

unifying 

passion 

values 

and 

of 

professionalism 

integrity, passion 

are 

and 

epitomised 

professionalism are epitomised in one common goal: to ensure quality SOE service 

in one common goal: to ensure quality SOE service provision to the people 

provision to the people of PNG that is sustainable. These three core values are 

of PNG. These three core values are supported by a culture of hard work 

supported by a culture of hard work and a drive for results; where individual efforts 

are augmented by strong team collaborations, professional development, and 

team informed collaborations, leadership; professional culminating development, in an environment and of informed excellence. leadership; 

culminating in an environment of excellence. 

p24 p20 

Kumul Review is a publication of Kumul Consolidated Holdings 

PO Box 320, Port Moresby 121, National Capital District, Papua New Guinea. 


Editor: Lae Tidal Glenn Basin Armstrong Project. | Layout: Our Future. Kala Komu Our | Port. Photography (unless otherwise indicated): Rocky DRAFT LOGO Roe Photographics 

PH: A publication +675 321 2977 of the | FAX: Independent +675 321 0192 Public | Business Email: media@kch.com.pg 

Corporation of Papua New Guinea. 


Website: Written and www.kch.com.pg produced by | Glenn Like us Armstrong. Facebook The IPBC Layout Review & Design December by Kala Komu. 2014Photography by Rocky Roe 

® Copyright 2014 

Copyright: July 2016

KUMUL Review July 2016

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