By GEORGINA MICHAEL
MINISTER for International Trade and Investment and Minister Responsible for PNG Power Limited (PPL), Hon. Richard Maru, has engaged lawyers to review the company’s Power Purchase Agreements (PPAs) with Independent Power Producers (IPPs).
Speaking at a media conference, Mr. Maru said a legal review of the agreements is underway and warned that those responsible for signing deals that have disadvantaged PNG Power will be held accountable.
“PNG Power is our pride and we must not allow it to go down. Individuals who are responsible and contributed to the downfall, whether you are Board or Management, we will deal with all of you,” Mr. Maru said.
“PNG deserves better. Those who need to be investigated and taken to the Police Fraud Squad for entering into deals that are costing us a lot, we will do that. I shall not leave any stone unturned. I have only eight months and I am going to make sure we turn the business around.”
Mr. Maru said he has appointed two lawyers to examine how the IPP agreements were procured.
“I have two lawyers looking into this and we are going to take the IPPs to court under the laws of this country. If it’s fraudulent, we will refer them to police. The lawyers are going to sit down and study the IPP agreements and see how they were procured. Were they put out on tender or not? Did they follow the law to enter into contracts with the IPPs or not?” he said.
He stressed that he is not opposed to Independent Power Producers in principle, but to agreements that are causing financial losses for PNG Power.
“I am only against those agreements where we are losing money, including those who entered into and got us into signing those deals. That may include ministers who approved those deals. We have a duty to this country and to save PNG Power. We have to reduce the cost,” he said.
Mr. Maru said years of mismanagement and unfavourable agreements have contributed to daily power blackouts and increased electricity tariffs for consumers.
“The net result of all of this mismanagement and bad deals is power blackouts every day,” he said.
“We must deal with the IPPs, the losses, and those who are escalating costs out of control at PNG Power. This business should have been privatised a long time ago.”
Looking ahead, Mr. Maru said Papua New Guinea has the resources to develop hydro and solar hybrid power projects
that would reduce generation costs and lessen reliance on expensive IPP arrangements.
He confirmed government support for two solar projects in Lae-Yalu and Wawin.
“If they are completed within the six to eight months timeframe, the expensive Munum Power project will not be needed anymore,” Mr. Maru said.
The minister also issued a strong warning to Independent Power Producers, particularly Munum Power and Dirio Power.
“Munum Power, your days are numbered. We will not be cheated and robbed anymore. I call Munum and Dirio outright robbers. They are robbing the people of Papua New Guinea and we cannot allow it to continue. We must stop this broad daylight robbery with the IPPs,” he said.
Mr. Maru reiterated that lawyers are now reviewing the Power Purchase Agreements to determine whether any of the contracts are illegal or fraudulent.