Resource extraction responsible for half world’s carbon emissions

Massive dump trucks by the Syncrude upgrader plant, Canada. The tar sands are the largest industrial project on the planet, and the world’s most environmentally destructive. Photograph: Rex/Shutterstock

Extraction also causes 80% of biodiversity loss, according to comprehensive UN study

Jonathan Watts | The Guardian | 12 March 2019 

Extraction industries are responsible for half of the world’s carbon emissions and more than 80% of biodiversity loss, according to the most comprehensive environmental tally undertaken of mining and farming.

While this is crucial for food, fuel and minerals, the study by UN Environment warns the increasing material weight of the world’s economies is putting a more dangerous level of stress on the climate and natural life-support systems than previously thought.

Resources are being extracted from the planet three times faster than in 1970, even though the population has only doubled in that time, according to the Global Resources Outlook, which was released in Nairobi on Tuesday.

Each year, the world consumes more than 92b tonnes of materials – biomass (mostly food), metals, fossil fuels and minerals – and this figure is growing at the rate of 3.2% per year.

Since 1970, extraction of of fossil fuels (coal, oil and gas) has increased from 6bn tonnes to 15bn tonnes, metals have risen by 2.7% a year, other minerals (particularly sand and gravel for concrete) have surged nearly fivefold from 9bn to 44bn tonnes, and biomass harvests have gone up from 9bn to 24bn tonnes.

Up until 2000, this was a huge boost to the global economy, but since then there has been a diminishing rate of return as resources become more expensive to extract and the environmental costs become harder to ignore.

“The global economy has focused on improvements in labour productivity at the cost of material and energy productivity. This was justifiable in a world where labour was the limiting factor of production. We have moved into a world where natural resources and environmental impacts have become the limiting factor of production and shifts are required to focus on resource productivity,” says the study.

The economic benefits and environmental costs are broken down by sector. Land use change – mostly for agriculture – accounts for over 80% of biodiversity loss and 85% of water stress as forests and swamps are cleared for cropland that needs irrigation. Extraction and primary processing of metals and other minerals is responsible for 20% of health impacts from air pollution and 26% of global carbon emissions.

The biggest surprise to the authors was the huge climate impact of pulling materials out of the ground and preparing them for use. All the sectors combined together accounted for 53% of the world’s carbon emissions – even before accounting for any fuel that is burned.

“I would never have expected that half of climate impacts can be attributed to resource extraction and processing,” said Stefanie Hellweg, one of the authors of the paper. “It showed how resources are hiding behind products. By focusing on them, their tremendous impact became apparent.”

The paper highlights growing inequalities. In rich countries, people consume an average of 9.8 tonnes of resources a year, the weight of two elephants. This is 13 times higher than low incomes groups. Much of this is unseen because huge amounts of materials are often needed for a small end product, such as a mobile phone.

Izabella Teixeira, former environment minister of Brazil, said the report highlighted how rich consumer nations have exported environmental to poor producing countries. With this model now hitting climate and biodiversity boundaries that affect everyone on the planet, she said it was time for change. “Currently decisions are being based on the past but we need to base them on the future. That means leadership.”

Where leadership could come from is difficult to see in the current political environment. The US and Brazil are slashing existing environmental regulations. China has moved ahead on renewables and pollution, but its growth is even more material-intensive than developed nations. According to the report, Asia is driving the fastest demand for minerals among upper-middle income countries, which now – because of their big populations – have a greater combined material weight than wealthy nations.

The authors said it was essential to decouple economic growth from material consumption. Without change, they said resource demand would more than double to 190bn tonnes a year, greenhouse gases would rise by 40% and demand for land would increase by 20%.

However, they said this dire scenario could be avoided if there is a faster transition towards renewables, smarter urban planning to reduce the demand for concrete, dietary changes to lower the need for grazing pastures and cut levels of waste (currently a third of all food), and a greater focus on creating a cyclical economy that re-uses more materials. They also called for a switch of taxation policies away from income and towards carbon and resource extraction.

“It is possible to grow in a different way with fewer side-effects. This report is clear proof that it is possible and with higher growth,” said Janez Potočnik, co-chair of International Resource Panel and former environment commissioner for the European Union. “It’s not an easy job to do, but believe me the alternative is much worse.”

Small Pacific country roasts Australia over its coal mining policies

Barbara Dreaver | TVNZ | 10 March 2019

One of the smallest countries in the Pacific has given Australia a roasting over its coal mining policies.

The low lying island of Tuvalu faces the full impact of climate change, and given the Regional Pacific Forum meeting is to be held there, fireworks are likely.

It wants firm action from Australia on its coal mining policies.

“I would implore and impress on the leaders of Australia to reconsider their coal mining policy and the $64 million dollars they are getting from selling their coal,” says Tuvalu’s prime minister, Enele Sopoaga.

It’s a big call for financially strapped Tuvalu to tell Australia to keep its aid.

“There is no point in giving ODA (Official Development Assistance), we appreciate it of course but giving it at the same time as continuing polluting the atmosphere and increasing the cost of adaptation I think just doesn’t work well,” Mr Sopoaga says.

But Tuvalu has a trump card. Its tiny shores will be hosting and driving the upcoming forum.

The small island states will be expecting to have their voices heard and with Frank Bainimarama attending for the first time in years, Fiji won’t be sitting on the side lines either.

As a world driver on climate change action, this could be an opportunity for Fiji to flex its muscles.

Despite a lot of diplomatic healing in recent times, Fiji’s prime minister still wants New Zealand and Australia out of the forum.

New Zealand First’s Winston Peters says much time has been spent resetting New Zealand’s relationship with Fiji.

“We are talking about a very expanded partnership going into the future, understanding it’s just not the interests of Fiji that we are talking about or the interests of New Zealand we are talking about but indeed our whole neighbourhood,” he said.

The whole neighbourhood will converge in Tuvalu in August and with 18 Pacific leaders at the table, it knows it has a captive audience.

Court rules out Hunter Valley coalmine on climate change grounds

A judge has rejected the Rocky Hill coal mine at scenic Gloucester Valley in the Upper Hunter because of its ‘visual and social impacts’. Photograph: David Angel/Alamy Stock Photo

Judge rejects Rocky Hill mine near Gloucester, NSW, because of its impact on the town and ‘dire consequences’ of increasing emissions

Michael McGowan and Lisa Cox | The Guardian | February 7, 2019

The controversial Rocky Hill coalmine in the Hunter Valley will not go ahead after a landmark ruling in the land and environment court on Friday that cited the impact it would have had on climate change.

Chief judge Brian Preston dismissed an appeal by Gloucester Resources, which was seeking to overturn a New South Wales government decision to reject an open-cut mine because of its impact on the town of Gloucester, north of Newcastle.

The EDO joined the case last April, arguing on behalf of its client, Groundswell Gloucester, that the mine’s detrimental impact on climate change and on the social fabric of the town should be considered as part of the merit appeal.

David Morris, the chief executive of EDO NSW, called the decision “momentous” and said it would be “profoundly influential” in the approval of future fossil fuel projects.

“It’s very difficult to see how any future coal project avoids the judge’s finding about this being the wrong time for it,” he said.

In his judgment, Preston explicitly cited the project’s potential impact on climate change, writing that an open-cut coalmine in the Gloucester Valley “would be in the wrong place at the wrong time”.

“Wrong place because an open cut coal mine in this scenic and cultural landscape, proximate to many people’s homes and farms, will cause significant planning, amenity, visual and social impacts,” he wrote.

“Wrong time because the GHG [greenhouse gas] emissions of the coal mine and its coal product will increase global total concentrations of GHGs at a time when what is now urgently needed, in order to meet generally agreed climate targets, is a rapid and deep decrease in GHG emissions. These dire consequences should be avoided. The project should be refused.”

In a “first of its kind” hearing, the EDO had argued that the mine should be refused in part because of its impact on Australia’s commitments to the Paris climate agreement.

In his judgment, Preston noted that while there was “no proscription” on the approval of new emissions sources such as coalmines under the agreement, approval of the project “cannot assist in achieving the rapid and deep reductions in GHG emissions that are necessary” to meet the goals of the agreement.

“It matters not that the aggregate of the project’s greenhouse gas emissions may represent a small fraction of the global total”, he said.

“The global problem of climate change needs to be addressed by multiple local actions to mitigate emissions by sources and remove greenhouse gases by sinks.”

He rejected GRL’s argument that the project should be allowed because emissions from the mine would be abated by other emissions reductions schemes as “speculative and hypothetical”.

“There is no evidence before the court of any specific and certain action to ‘net out’ the GHG emissions of the project,” he wrote in his judgment.

“A consent authority cannot rationally approve a development that is likely to have some identified environmental impact on the theoretical possibility that the environmental impact will be mitigated or offset by some unspecified and uncertain action at some unspecified and uncertain time in the future.”

The judgment also rejected the mine on the grounds of its visual impact and the social impact of factors such as dust and noise on the surrounding community.

Morris said the ramifications would be felt by state and federal ministers and other decision makers who assess fossil fuel projects.

“This is necessarily a case-specific judgment. It relates to this coalmine proposed in the Gloucester Valley,” Morris said. “It is persuasive, influential but it is not binding on any future decision.

“But it will weigh heavily on the minds of decision makers.”

He said the judge’s comment that the mine was being proposed at the “wrong time” was “applicable to every fossil fuel project that’s proposed in this country and internationally going forward.”

Morris said Australia was increasingly approaching a moment when approval of a fossil fuel project could be considered “unreasonable”.

“And unreasonableness is a ground of legal challenge,” he said.

Climate Council chief executive Amanda McKenzie also welcomed the decision.

“The NSW Land and Environment court has effectively ruled that coal – just like tobacco and asbestos – is bad for us,” McKenzie said.

“I’m thrilled to see the law catching up with the science.

“If I was proposing to build a coal mine right now, I’d be feeling pretty nervous.”

NSW planning minister Anthony Roberts was asked for the government’s reaction to the court’s decision.

“That is the legal process and we respect the court’s decision,” he said.

A spokesman for the NSW planning and environment department said the department was pleased the court had agreed with its recommendation on the proposed coal mine. He said the decision supported the current process of assessing developments on a case-by-case basis.

In 2017, the independent planning commission rejected the mine because of its proximity to the town of Gloucester, its visual impact, and contravention of the city’s zoning plans.

“The judgment confirms the Department of Planning and Environment was correct in its decision to recommend refusal of the application to the Independent Planning Commission, and the Commission was correct to refuse the application,” the spokesman said.

“This decision shows NSW has a robust and transparent planning process that is delivering the best outcomes for the whole community.”

K400M Lae Coal Plant In Jeopardy

Benny Geteng | Post Courier | February 7, 2019

THE proposed K400 million coal-fired power plant to be built in Lae is in jeopardy as PNG Power Limited is not considering the power option put forward by developer Mayur Resources.

PPL acting managing director Carolyn Blacklock, when responding to questions posed by the Post-Courier in regards to the power purchasing agreement sent by Mayur to PPL and how the PPL is handling the proposal at present, said PNG Power is not considering the Mayur proposal.

This means the bid to have the coal power plant in Lae is in limbo since the PPA approval will grant Mayur the green light to go ahead with the project construction phase.

Ms Blacklock said PNG Power has a clear IPP Policy that supports competitive bidding of planned generation, transmission and distribution investments.

“It is not a planned activity of PNG Power and is not being considered,” she said.

Mayur managing director Paul Mulder said PNG Power is under obligation to assess the power purchasing agreement (PPA).

“The PPL board has the obligation to assess our bid and make recommendations this year,” he said.

Energy minister Sam Basil had earlier written to PPL board chairman Peter Nupiri in October to request PPL board to assess Mayur’s proposal since their bid was solicited by PNG Power through a letter by Chris Bais (PPL director strategic planning and business development) in 2015, granting Mayur leave to send a PPA proposal for assessment.

Mayur Resources submitted a proposal that is still yet to be assessed by the PPL board.

This now contradicts Ms Blacklock’s response since according to Mr Basil’s letter, until the review of Mayur’s proposal is assessed, then he will accept the PPL’s board decision.

The coal power plant in Lae is to be spearheaded by Mayur Resources Limited and is expected to utilise coal seams extracted from the seas of Gulf province and is anticipated to generate revenue for Lae City Authority and the Morobe provincial government.

Mr Basil, Lae MP John Rosso and Morobe governor Ginson Saonu have backed the proposed project to be built in Lae .

It is expected to generate K4m annually to the provincial coffers, among other benefit

Coal Power not a Favorable Option

Stret Pasin:  Good news but I hope she has locked in her support as she will come in for attack from the coal proponents and their cronies. They will try to get rid of her if she does not follow their line.

Adelaide Kari | EMTV | February 5, 2019

Mayur Resource when speaking to EMTV News stated that they had submitted a Power Purchase Agreement proposal to PNG Power and was confident they had tick all the boxes.

Today, PNG Power Acting Managing Director, Carolyn Blacklock, commenting on the proposal of coal, said the company is looking towards renewable energy.

PNG Power confirmed they had received the Power purchase agreement for Mayur Resources but were not confident that the proposal showed a commitment that would last 25 years.

Blacklock also stated that PNG Power was looking more towards hydro and solar, and coal power would not be a part of PPL Plan.

The Minister for Energy, Sam Basil, an open supporter of the Coal Power station, has publicly said the ball was now in PNG Power’s corner. With PNG Power weary of the idea of a coal power station, what does this mean for Mayur’s prospect of a coal power station?

But the prospect of a Coal Power station may still be pushed with the National Energy Bill that is currently being drafted, exact specifics of this touted National Energy Bill have not been given out to the public just yet. The Minister for Energy, Sam Basil, stated it will allow other energy companies, provincial governments and landowners to enter into agreements to supply energy without approval from the State-owned PNG Power.

Northern Governor, Gary Juffa, who has openly gone against the idea of coal mining in PNG, says the National Energy Bill needs to be structured properly, and should be based on renewable energy. Governor Juffa stated that the bill will allow provincial government to create revenue and is a positive to the bill.

The argument for cheaper vs cleaner energy has become the source of a debate that will continue until the National Energy Bill is tabled in Parliament, and even that information, is still unclear.

Aussie Coal Use Impresses Tuke

Benny Geteng | Post Courier | February 1, 2019

MINING Minister Johnson Tuke is impressed with coal-powered technology used in Australia and has indicated strong backing of the Lae coal-powered plant project.

Mr Tuke’s trip to one of Australia’s coal mines in January assured him that the similar technology that will be used by Mayur Resources for the K400 million proposed project for Lae will be beneficial.

He said globally, coal is a resource of immense proportions and PNG has never mined coal, while neighbouring countries, especially Australia and Indonesia, continue to reap the rewards of this commodity by exporting and empowering their people with far higher living standards than what we have in PNG, while using inferior coal quality compared with our PNG coal.

“This coal has remained in the ground and until recent years this was the same story for gas, which now is a thriving LNG sector,” Mr Tuke said.

“If you look at Australia, they are benefiting by creating large revenue from coal exports and domestically, coal still provides more than 60 per cent of all their electricity generation. Coal is forecast to be Australia’s largest export earner at AUD$58.1 billion (K137.5bn) in 2018-19, this one commodity is two times PNG’s GDP for the entire country per year.

“That’s K138 billion and while we may not have this volume to export or use internally, even imagine if a coal industry could add K1-2 billion to government revenue. Gulf Province is endowed with extensive far cleaner coal seams than what Australia uses and you can even touch it at the surface.

“I saw houses around the power plant, I saw clean water, I saw abundant fish life in the cooling water channel leading into Lake Macquarie, I saw trees and parks, and no black smoke, only very minor clean filtered steam from the power plant.”

He said Vales Point (NSW, Australia) operating coal power plant produces 1330 megawatts, 2 two times bigger than PNG’s total installed electricity and that is 26 times bigger than what is proposed in Lae.

Mayur Resources managing director Paul Mulder said the proposed coal powered plant in Lae is similar and will rid Lae city of its blackout situation once given permission to supply power on the Ramu Grid.

He said power supply will be on 24 hours — 7 days a week, 100 per cent continuous supply for Lae city.

Mr Tuke said that people should not be blind to what is happening outside PNG in neighbouring countries.

Rugby League stars’ promotion of coal in PNG questioned

Brisbane and Queensland rugby league player Sam Thaiday. Photo: PHOTOSPORT

Radio New Zealand | 23 January 2019 

Questions have been raised in Papua New Guinea over the visit by Australian rugby league stars to promote coal development in the country.

The Australian company Mayur Resources has an environmental permit to mine coal in PNG’s Gulf Province, and is proposing a coal-fired power plant in Lae.

It’s recently deployed a second former league star, Sam Thaiday, to PNG in a promotional capacity.

Former Australian captain Darren Lockyer is Mayur’s head of Business Affairs.

Christian Lohberger of Nogat Coal PNG, which opposes Mayur’s plans, said the league stars, and Lockyer in particular, are idolised in PNG.

“Even though they’re just footballers, when they talk and say stuff, people listen. So I guess it’s a smart move by Mayur to bring them on board. But I don’t know if it’s really ethical that they should be using Papua New Guineans’ love of rugby league to promote something that’s not really connected.”

Mr Lohberger said that the proposed plant would create significant pollution and cause harm and death to local communities.

However, PNG’s Minister for Energy Sam Basil is supporting the coal project, saying it would open up access to cheaper energy that has long been lacking in the country.

Mr Basil has voiced concern that the current power plant in Lae uses imported heavy fuel oil and is cost inefficient.

He said that PNG should explore as many local energy options as possible, given the country’s range of natural resources.

However the plant backers have not secured a local customer or off-taker for the power produced at the plant.

The main power supplier in the country, PNG Power, has been reluctant to buy electricity from coal sources.

Mr Lohberger said he understood PNG Power was waiting on a pending World Bank report on a comprehensive electricity generation cost strategy, which could affect a decision on linking up with Mayur’s plant.

“I would say with the way global trends are going, the surge in renewable energy, and the fall in prices of solar and wind and hydro, that any report that takes a look at power prices is not going to be favourable to coal,” he explained.

But global shifts away from investment in fossil fuels, due to pressing climate change issues, are not deterring the minister who has cited PNG’s neighbours’ energy policies.

Mr Basil said that with both Australia and Indonesia heavily reliant on coal power, PNG should not deprive itself of a home-grown asset.

Tuke seduced by coal

Tuke Visits Coal Plant ‘For Perspective’

Post Courier | January 10, 2019

Mining Minister Johnson Tuke visited a coal fired power plant north of Sydney to gain a perspective on modern technology and the benefits of utilizing PNG’s own domestic coal resources.

The 15th Papua New Guinea Mining and Petroleum Investment Conference was held in Sydney, Australia last month, with an extensive focus placed on the future of mining and energy solutions for Papua New Guinea.

While attending the Conference last month, a senior PNG government delegation led by the minister conducted a visit to one of Australia’s longest running power plants.

The Mining Minister’s focus was to understand better how PNG could benefit from a more diversified energy mix at the lowest cost while also developing a more diversified resources and mining sector.

PNG, while strong in gold, copper, and recently in natural gas and nickel production needs to diversify its opportunities and create new revenue sectors for the nation. This was a sentiment echoed throughout the Sydney conference.

Power generation was also key topic of debate at the conference, including the nationwide electrification program that is essential for PNG to meet its commitments set out in the Alotau accords.

“I am looking at ways to expand opportunities in our extractives sector, how to increase Government revenue from Mining, and using global research in consultation with our international partners to review the sectors that PNG should be considering.”

“While it is a debated topic currently, especially in the Lae region, NEC has agreed that in our current state of energy poverty with only 13 per cent of our people having access to electricity, we will look at all forms of energy in our energy mix as all other nations around us have and will continue to do.

He reminded those critical to idea of a coal producing PNG, not to forget that for the last 43 years since independence most of PNG’s electricity has come from high polluting imported heavy fuel oil and diesel.

“I need to remind them we have our own cleaner low cost, low ash, low Sulphur high quality coal right here in PNG in the Gulf Province.

“Globally coal is a resource of immense proportions. PNG has never mined Coal, while our neighbouring countries (especially Australia and Indonesia) continue to reap the rewards of this commodity by exporting and empowering their people with far higher living standards than what we have in PNG while using inferior coal quality compared with our PNG coal,” Mr Tuke said.

Govt will support coal power plant, says Basil

Peter Esila | The National aka The Loggers Times | November 29, 2018

THE Government will support any type of energy-producing sources developed in the country, including coal, says Minister for Energy Sam Basil.
Basil, one of the major proponents of the coal project in Lae together with Lae MP John Rosso, said this on FM 100 talkback radio yesterday in reference to that project.
Bulolo MP Basil and Ross have already encountered fierce resistance to the project in light of environmental implications.
This includes biomass energy project landowners in the Markham Valley of Morobe.
“We will continue to support all the different power-producing companies using different methods that are coming into PNG to operate, coal being one of them,” Basil said.
“The important thing that we must also look at is that when we start putting new power plants in districts and provinces, I’d like to look more into the landowners, the local level government, districts, towns and the provinces.
“What kind of benefits will we have in return for those people who may have their land and resources available for those projects to take stage?
“We should now be looking at more benefits rolling back into the host districts and provinces, and landowners.”
Basil is aware of resistance to him and Rosso.
“I would like to test new ideas, new ways of doing things because PNG has been neglected for awhile,” he said.
“Our neighbours Indonesia and Australia are heavily dependent – more than 50 per cent – on coal.
“We should be asking ourselves: How can we progress PNG forward? I think that one of the answers is having access to energy.
“We have a lot of raw resources to burn, to produce products for us, decapitating international prices by having access to our own energy here like gas, coal and others.
“It is one of the things that we should be promoting,”
Of solar energy, Basil said: “We are looking for solar places.
“For example, we are asking the DDA (district development authority) of Markham and other districts that have ample land, good sunlight, to make land available.
“Register with the Energy Department so that when people come and look around for putting up solar plants, we have got land there.
“We can also identify potential sites for geothermal.”
Basil said that the National Energy Bill, which would allow for energy investments, was in its final stages.

Australian company pushing to open Papua New Guinea’s first coal-fired power plant

PHOTO: A new 60 megawatt power station would have the ability to burn coal as well as use renewable biomass. (ABC News: Peter Giafis)

An Australian company is pushing ahead with plans to open a coal-fired power plant and coal mine in Papua New Guinea, despite the recent call from the world’s most authoritative climate science body to completely cut greenhouse emissions by 2050.

Key points:

• Mayur Resources plans to open a power plant and possible coal mine in PNG
• A new power facility is expected in just over two years, the Energy Minister says
• Activists say the move would be counter to PNG’s commitments under the Paris accords

Yara Murray-Atfield | ABC News | 19 October 2018

Australian-based and PNG-focused Mayur Resources is proposing the establishment of an “Enviro Energy Park” in the industrial hub of Lae in PNG’s Morobe province.

Mayur has been in talks for the project since at least 2014, but now a new memorandum of agreement (MOA) has been signed between the company, the Lae City Authority, and the Morobe Provincial Government.

The MOA details plans for a new 60 megawatt power station, with the ability to burn coal as well as use renewable biomass, solar energy, and by-product heat.

Mayur Resources’ managing director Paul Mulder told the ABC the company was essentially at the stage of being “construction-ready” for the project, which he said would significantly reduce the energy cost for Papua New Guineans.

On Tuesday, Mayur released a statement to the Australian Stock Exchange detailing further non-binding plans to work with coal exporter Square at a coal mine in another province, touting the “low-ash, low-sulphur coal” found at Gulf Province’s Depot Creek.

If the projects are built, they would mark the first coal-fired power plant and coal mine in the country.

Coal generates mixed reaction

The project has attracted high-profile supporters, including Energy Minister Sam Basil who did not respond to an ABC request for comment, but said in a Mayur press release that “we can expect a new power facility in just over two years from now”.

“Whilst there are always those that will criticise, I take this opportunity to outline that Australia enjoys its first world developed lifestyle with 70 per cent of its total energy coming from coal,” Mr Basil said in the release, adding that this project would only be a much smaller fraction of PNG’s total energy.

PNG is a signatory to the Paris Agreement and, like Australia, recently signed the Pacific Islands Forum’s Boe Declaration, which says climate change “remains the single greatest threat to the livelihood, security, and wellbeing of the peoples of the Pacific”.

An assessment from PNG’s Conservation and Environment Protection Agency has given its endorsement to the plan, but it still faces community backlash.

“Our neighbours are really facing an existential crisis from sea level rise,” Christian Lohberger, head of anti-coal activist group Nogat Coal, told the ABC.

“So we think it’s irresponsible for Papua New Guinea to invest in coal, especially because there are many, many alternatives in Papua New Guinea for energy generation,” added Mr Lohberger, who also works for the Astra Solar company in PNG.

In 2016, World Bank data suggested only 23 per cent of the population had access to electricity, and even larger, electrified cities like the capital Port Moresby and Lae experience severe and frequent power outages.

Mr Mulder of Mayur Resources said PNG was an “energy-starved nation” and that the proposal “reduces the emissions footprint of what is currently the state of play in Papua New Guinea.”

Most prominent businesses in Lae use diesel-powered generators, which can produce carbon dioxide and other particulate emissions, and are known to reduce air quality.

“We’ve got the emission thing, but by the same token, if you lived in Lae, you would understand,” Lae MP John Rosso told the ABC.

“We have huge power fluctuations and we [sometimes] go a week without power.

“Our factories are suffering, our consumers are suffering, and I had to make that call, because we can’t keep sitting in the dark and letting our kids sit in the dark.”

The plan does have some resistance within government circles, with the Minister for Lands and Asia-Pacific Economic Cooperation (APEC) Justin Tkatchenko telling the ABC “for me personally … I am against coal fire, 100 per cent”.

Final hurdle is ‘unsolicited’ power agreement

The recent MOA is not an official contract, but Mayur said it had completed a feasibility study, selected a site, secured environmental approval, and received bids for the construction of the facility.

The plan also details a commitment to fully fund a research institute at the University of Technology, and provide $130,000 per year for 25 years to a local charity.

The sticking point for the project is now getting national provider PNG Power to sign a Power Purchasing Agreement (PPA) before energy could be sold to the country’s grid.

PNG Power’s acting managing director Carolyn Blacklock said they had received four “unsolicited” PPA proposals from Mayur over several years, without a public tender process, and that it was unlikely a deal would be signed without a competitive bidding process.

But Mr Mulder said the company received a written request for a PPA and was provided with PNG Power documentation to submit, which they did in March 2016.

The ABC has sighted a letter that appears to be from then-director of strategic planning and business development Chris Bais dated October 2015, which “welcomes” Mayur to submit a PPA proposal.

Ms Blacklock took on the acting managing director job earlier this year following a reshuffle of the company’s board and has overseen a massive restructure of the company.

She said regardless of what correspondence the company had engaged in to date, PNG Power had no obligation to accept any PPA proposal.

“In PNG we have very high costs over power, in part driven because what has been done at PNG Power: uncompetitive processes that have led to uncompetitive prices that leads to uncompetitive tariffs for our consumers,” Ms Blacklock told the ABC.

Meanwhile Energy Minister Sam Basil was quoted in the press release as saying “there is no cheaper alternative ready to be built” and that it was time for PNG Power to “act swiftly” to finalise the agreement.

“It doesn’t mean just because there’s pressure applied, that the PNG Power board or myself or management are going to be swayed,” Ms Blacklock said.

A month ago, Mayur resources was floated on the Australian Stock Exchange and raised $15.5 million in an over-subscribed initial public offering — money they say will go towards developing further projects in PNG.