PNG POWER may be partially sold and the country’s power generation outsourced following the completion of a review of the troubled generator’s operations.
“All parties agreed that PNG Power is in serious financial dire straits, and there is an urgent need for the government and Energy Worker’s Association (EWA) to find a solution,” Prime Minister Peter O’Neill said in October.
“The government cannot continue to bail PNG Power out of its financial woes.
“We must find a way to make PNG Power become a viable and efficient provider of power supply in the country.”
Minister for state enterprises Ben Micah described PNG Power as a “sick patient on a life support machine” and said the government must “find a viable solution to resuscitate this patient, otherwise we will face bigger issues”.
Mr O’Neill and Mr Micah met with executives of the EWA in October to discuss restructuring the business according to a public-private partnership business model.
Mr O’Neill stressed that contrary to media reports, the business would not be completely privatised.
“The government is proposing to invite the private sector to participate in the power generation sector in Papua New Guinea with any investment staying with PNG Power to expand infrastructure and capacity,’ he said.
“If we do not take a proactive approach to address power generation needs now, the gap between power generation supply and demand will only increase.
“As part of this, we agreed that any restructuring will be undertaken through consultation that will include the PNG Power board and management, unions and Independent Public Business Corporation.“
Among key outcomes from the meeting was an undertaking to ensure stakeholder consultation in the process and a commitment to meet employee entitlements.
EWA president Edward Gisa thanked Mr O’Neill for the opportunity to meet with members to discuss issues and welcomed the government’s commitment to address worker entitlements.
He pledged the support of the union to work with the government in addressing issues relating to the future of the company.
A strategic working group comprised of stakeholder parties will be established to conduct an in-depth assessment of PNG Power and recommend options to the government.
“I also made the commitment to staff that before any restructuring is completed, outstanding entitlements owing to PNG Power workers will be paid in full,” Mr O’Neill said.
“The national government and PNG Power have a responsibility to ensure these entitlements are met.”