1. what is gulf offering australia, and the rest of the...

Ihu Special Economic Zone Critical Capital Infrastructure Projects Program

Peter KenGemar, Shangri-La Hotel, Sydney. Monday 19th August 2019

IhuSpecialEconomicZoneProjectProjectManagementTeam

POBox7354,Boroko,NCD,PapuaNewGuinea

1.WhatisGULFofferingAUSTRALIA,andtherestoftheworld?

2.Why&WhenshouldYOUbeinterested

inGULF?



1. Introduction – Location Map

INFORMATION–GULFPROVINCE KIKORI:KIKORIDISTRICT

GENERALCAPITAL:KEREMA

POPULATION:200,000(2015Est.),158,197(2011census).LAND:34,472SQ.KM,PEOPLEETNICITY:MELANESIAN,PAPUANLANGUAGE:16LANGUAGES,ENGLISH,PIDGIN,HIRIMOTUURBANSETTLEMENT:15%,85%INRURALCOMMUNITIESWITHSUBSISTANTAGRICULTUREBASE

51,000(30%est.)27,154SQ.KM(80%)Melanesian8Language+HiriMotu+Pidgin+EnglishSubsistentfarming,fishing,hunting

GOVERNMENT

GOVERNOR:HON.CHRISHAIVETA,MPKIKORIELECTORATE:HON.SOROIEOE,MP,MINISTERFORFOREIGNAFFAIRS&INTERNATIONALTRADEKEREMAMP:HON.RICHARDMANDANIADMINISTRATOR:MR.MARCORISURUAVAI

KIKORIELECTORATEMP:HON.SOROIEOE,MP,MINISTERFORFOREIGNAFFAIRS&TRADEDEPUTYGOVERNORFORGULF:HON.CHARLESMAIU,MPA

LOCALGOVERNMENT

LOCALLEVELGOVERNMENTS:10(20,000HEAD)NUMBEROFCOUNCILWARDS:150(1,333HEAD)

KIKORI:4LLGKIKORI:77COUNCILWARDS

TRADEVOLUME GULFPROVINCE1.   FORESTRY:2.   FISHERIES:3.   KUMULCRUDEEXPORT

TERMINAL:

MAJORNEWINDUSTRIALPROJECTS1.   PAPUALNG:TARGETFIRSTGAS,20232.   PASCAGAS:TARGETFIRSTPRODCTION,20213.   WESTERNLNG4.   GULFINDUSTRIALCENTRE5.   ISEZ-FREETRADEZONE

Vailala1&2,Turama2ndlargest.OrokoloprawnshubKumulMarineTerminalPNGLNGPipelinesectionCoal&IronSandsLimeandCement14majorriversforhydropower

“GULF PROVINCE COULD BECOME PNG’S PREMIER NATURAL GAS PROVINCE” L. BROWN, VP, INTEROIL (2014)

GULFPROVINCE&KIKORIDISTRICTPROFILE



1. Introduction – Kikori Gulf

Oil&containershippingroutesandonairtrafficpath



2. Strategic Location

Locationnextto2ndLNGdevelopmentinPNG



2. Strategic Location



3. Natural Resource Base

GAS

1/89 80%

FORESTRY

2/89 20%

COAL

1/89 90%

IRONSAND

3/89 40%

FISHERIES

9/89 7 Lic

WATER14

Wednesday,21August19

7

6800

BC

F

2500

BC

F

500

BC

F

350

150

1000

BC

F

120

1000

BC

F

1000

BFC

480

250

{{



3. Resource Base - GAS

17,150 BCF IN TOTAL. REPRESENTS 80% OF PNG’S GAS RESERVES Development Cost

$35 Billion

8



4. CURRENT PROJECTS

GOVERNMENTPROJECTS PRIVATESECTOR

Gulf–HighlandsHighwayProject4Phases,Phase1completed,3TBC

US$13BillionPapuaLNGProjectGasAgreementSigned(review)

KikoriDeepSeaPortFeasibilityStudyatcompletionstage

US$2.5BillionPascaOffshoreGasProjectsFieldDevelopmentPlanSubmitted

KikoriFreeTradeZoneFeasibilityStudytobestart2020

VailalaCoalProjectExplorationStage

Purari2,000MWHydropowerSchemeFeasibilityStudyCompleted

OrokoloBayIronSandsProjectExplorationStage

VailalaForestryLoggingProject2025DownstreamProcessing

Private&PublicSectorProjectsinKikoriDISTRICT,GulfProvince

COREFreeTrade

Zone

PetroChemicals

PapuaLNG

PascaGasDMO

EnergyFuel

RoadSeaportAirport

FisheriesAgriculture

Forestry

DownstreamManufacturing

9



5. IHU SPECIAL ECONOMIC ZONE

LinkagebetweengasLNGdomesticgasrequirementIndustrialactivities

LinkagebetweengasLNGdomesticgas,cheapGTEpowerAnddomesticfuelsubsidy

Linkagebetweencriticalcapitalinfrastructure,Fuelcostsandgeneralbusiness

LinkagebetweenDMOgasPetrochemicalsandfertilizerforagriculture

LinkagebetweennaturalResources,internationalAndlocaldownstreamandmanufacturing

LinkagebetweendownstreamProducts,increasefoodProductionandagriculture

Linkagebetweeninfrastructure,DownstreamprocessingandreachLocalandinternationalmarket

LinkagebetweenFreeTradeZoneDownstreamproductsandInternationalexports

L I N K A G E S

10



5. GLOBAL SEZ’S GROWTH

11



5. IHU SPECIAL ECONOMIC ZONE

12



6. BACKBONE INFRASTRUCTURES CRITICALCAPITALINFRASTRUCTUREPROJECTS(CCIP)PROGRAM

q  DeepseaPort•  IndustrialJetty

q  Roads•  AccessRoad•  RingRoad

q  InternationalAirport•  UpgradeIhuAirstrip

q  Power•  25MWLohikiHydropower•  5%DMOGasPapuaLNG

q Water&Sewerage

q  IndustrialTownship•  GovernmentAdminCentre•  Military+NavalBases•  Gated+Secured

13



7. INVESTMENT PROGRAM CCIP&ISEZINVESTMENTPROGRAMS

K60 billion x 0.02% = K1.2 bil

K2.6 billion K1.2 billion K1.4 billion

•  LOCALSOURCEOFFUNDS•  Frontload2%DevLevy•  Refinance2%ProdLevy•  InfrastructureDev.Grants•  TaxCreditSchemes

1.   GOVERNMENTTOGOVERNMENTPARTNERSHIP

2.   PUBLIC-PRIVATEPARTNERSHIPSWITHFOREIGNDEVELOPERS

3.   JOINTVENTURES:FOREIGNDEVELOPERS&LOCALCOMPANIES

14



8. BENEFITS 1 - REVENUE

GLOBALSEZREVENUESTATISTICS GrowthRateGlobal:1985=$6B,1995=25B,2005=600B,2015=$1000 =5.5%Australia:GDPrate1985to2015 =2.5%PNG:GDPrate1985to2015 =5.5%

500newSEZplannedbeyond2019

Newstrategies-->newopportunities--->newREVENUE$$$

15



8. BENEFITS 2 - EMPLOYMENT

LOCALEMPLOYMENTSTATISTICSAustralia2019UnemploymentRate =5.2%represents713,400(24.415mil)UnemployedYouths(15-24)Rate =12.9%2018represents266,000

PNG2019UnemploymentRate =2.5%represents219,500(8.78mil)UnemployedYouths(15-24)Rate =4.65%244,590(5.26mil:60%ofpop)

Newstrategies-->newopportunities--->newEMPLOYMENTCREATION

Forty-fouryearsago,80specialeconomiczones(SEZs)in30countriesgeneratedbarelyUS$6billioninexportsandemployedabout1millionpeople.Today,5,000SEZsoperatein155countriesandaccountforUS$600+billioninexportsand85milliondirectjobs.Alargenumberofthemareoperatingindevelopingcountries.Year SEZs Countries Revenue Employment1975: 80 30 $6billion 1million1985: 170 47 $12billion 6million1995: 500 73 $25billion 23million2005: 3,300 130 $600billion 50million2015 5,000 155 $1000billion 85million2019 5,400

GLOBALSEZEMPLOYMENTSTATISTICS

16



9. PROGRESS UPDATE COMPLETEDTASKS2017Aug-17 CompleteionofNationalElection,FormationofNewGovernmentofPNGOct-17 CCIP&ISEZprojectsConceptDevelopmentNov-17 SWOTAnalysis,SiteSelectionPreliminarytownplanningandengineeringdesigns

Jan-18PresentationandmeetingwithallrelevantstakeholdersincludingGovernmentagencies,GulfProvincialGovernment,Stateownedenterprisesandpotentialforeigndevelopmentpartner

Jun-18 KikoriDistrictDevelopmentAuthorityApprovalofconceptandplanningworkprogram

Oct-18MinisterialdelegationvisitISEZprojectsiteanddiscussedprojectsignificancewithlandowners.TeamincludesPlanningMinister,Commerce&IndustryMinister,ForeignAffairsMinisterandUrbanisationMinisterwithGulfProvincialAdministrator,KikoriAdministratorandISEZprojectteamleader

Nov-18FeasibilitystudyforKikoriDeepseaPortawardedtoChineseconsortium,ContractstoPNGArchitechsfirmandPhilippinesconsortiumforphysicalplanningandenginneringdesignandsimulateddevelopmentofISEZincluding3Dandphysicalscaledesign

Dec-18ISEZ3DdevelopmentsimulationandphysicalscalemodelpresentedatAPEC2018,withofficialopeningbyDeputyPrimeMinisterbeforeCommerce&IndustryMinister,ForeignAffairs&InternationalTradeMinisterandFinanceMinisternowPrimeMinister.

Dec-18 Projectmarketingandpromotions,discussionswithpotentialinternationaldevelopmentpartners

Jan-19 BoothpresentationatPNGPetroleum&EnergyInvestmentSummitPortMoresbyApr-19 NationalExecutiveCouncilapprovalofIhuSpecialEconomicZoneprojectconceptJun-19 FormationnewMarape/StevenGovernmentJun-19 BoothpresentationatAustraliaPNGBusinessCouncilConferenceinPortMoresbyJul-19 EngagementswithPNGPorts,HallContractingAustraliaandothersforearlyworksdesignselectionforISEZseaportJul-19 Submissionsfor2000budgetfundingforCCIP&ISEZprograms

Aug-19NationalExecutiveCouncilapprovalofkeySEZPolicysubmissionsincludingSEZestablishmentsinPNG,SEZAuthorityandSEZActtobedrafted.

Aug-19 ISEZsecondNationalExecutiveCouncilApprovalforworksprogramSep-19 PresentationsandpromotionsinAsiaOct-19 LandMobilisationProgramandSocialMappingNov-19 SigningafewProjectspecificMOU/MOAandContractsDec-19 DetailedFeasibilityStudies,ScopingStudies,EIS,SocialMapping

COMPLETEDTASKS2018

COMPLETEDTASKS2019

WORKPROGRAMGOINGFORWARD2019-2020

17



9. PROGRESS UPDATE

Deepsea Port Industrial Jetty

Deployment

18



9. PROGRESS UPDATE OfficialPublicationsnowavailable

KDDA5YDevelopmentPlan2018-2022

112Pages

CCIPProgram72Pages

ISEZProgram72Pages

1.WhatisGULFofferingAUSTRALIA,andtherestoftheworld?

2.Why&WhenshouldYOUbeinterestedinGULF?

8.BusinessAdvantageInternational:KevinMcQuillanandAndrewWilkins





Contents 1. INTRODUCE………………….DISTRICT & PROVINCE PROFILE

2. STRATEGIC LOCATION………....LOCAL & INTERNATIONAL TRAFFIC ROUTES

3. RESOURCE BASE………………OVERVIEW

4. CURRENT PROJECTS………......PRIVATE & PUBLIC SECTOR DEVELOPMENTS

5. IHU SPECIAL ECONOMIC ZONE…THE ECONOMIC ENVELOPE

6. BACKBONE INFRASTRUCTURES…CRITICAL CAPITAL INFRASTRUCTURES

7. INVESTMENT PROGRAM……….INVESTMENTS IN CCIP & ISEZ

8. BENEFITS……………………..EXPECTED REVENUE & EMPLOYMENT

9. PROGRESS UPDATE………..…...COMPLETED TASKS AND NEW WORK PROGRAM

10. FINAL REMARKS………………ANSWERS TO THE 2 QUESTIONS

21



9. FINAL REMARKS KeystoSuccess

Oil/Gas,Forestry,Fisheries,Agriculture,Water,Coal,minerals,

lime

Power,water,sewerage,telecom,waste,roads,airport,seaport

Fare,quantity,quality,capability,

Resourceaccess,accessroutes(sea/air/land),security,space

Tax,Procedures,Rights,Prices

Landaccess,infrastructure&socialservices,construction

&maintenance

6 Keys to ISEZ

Success

1. Location

6. Natural

Resource

Base

3. Incentive

s 5. Cost

Performance

2. Infrastructu

re

4. Work Force

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