Papua New Guinea
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30-day emergency declared over fuel issue

The 30-Days Declaration of Emergency sets out a Plan of Action to investigate, amongst other issues, the Bank of PNG’s 13 Allegations against Puma Companies.

In a press statement, Minister for Petroleum and Energy, Kerenga Kua announced on behalf of the National Government that a Declaration of Emergency has been made as per the National Executive Council Decision No. 215/2023.

The declaration is pursuant to Section 136 (1) of the National Energy Authority Act 2021 (NEA Act) and Section 4 of the Essential Services Act 2002 (ES Act).

“This Declaration of Emergency is made as a direct result of the current disruption in the supply and distribution of fuel and petroleum products and foreign exchange,” said Minister Kua.

He states that the Declaration of Emergency intends to achieve two objectives;

  1. The first being an interim measure to maintain the fuel and petroleum products supply in PNG; and
  2. The second being the long-term objective to ensure that the country’s energy demand, including fuel and petroleum products, is permanently stabilised and is readily available for the country.

“The Puma Energy Limited (PNG) and Puma Energy (PNG) Refining Limited (together to be known as ‘Puma Companies’) and the Bank of PNG’s current dispute over the availability of foreign reserves to purchase fuel and petroleum products for the country has disrupted supply and without the Government’s intervention,” stated Minister Kua.

He said the crisis will directly affect the country’s energy security, disrupt government services and businesses, and generally have a negative impact on the economy and welfare of our people.

The following departments and statutory bodies’ administrative heads will constitute the State Parties in the Roundtable Talks to review the allegations:

  • Chief Secretary to Government, Managing Director of National Energy Authority, Secretary for NEC,
  • CEO of Kumul Consolidated Holdings, Secretary for Department of Petroleum, Director of Financial Assessment & Supervisor Unit (Independent body housed under BPNG), State Solicitor
  • Secretary for Justice & Attorney General, Commissioner General of Internal Revenue Commission, Secretary for Treasury, Chief Commissioner of PNG Customs
  • CEO for PNG Power Limited, Managing Director of Mineral Resources Development Company, Managing Director of Kumul Petroleum Holdings Limited and A/CEO for Air Niugini.

“The Government is aware of the Westpac and ANZ Banks' closure of the Puma Companies operating accounts,” said Minister Kua.

The Bank South Pacific has issued a notice of intention to close all the Puma Companies operating bank accounts upon expiry of 90 days from the date of notice which if effected would be the 8th of September 2023.

“This action taken by the BSP is occurring independently of the Government and Bank of PNG’s influence and is purely a global banking and finance response,” added Minister Kua.

In response to the action taken by BSP, the Government has directed the Minister for Petroleum & Energy to instruct the Bank of PNG to provide the Authorised Foreign Exchange Dealers.

This includes BSP bank for access by all consumers including the Puma Companies’ bank accounts to be maintained, and a continuous access to the supply of foreign exchange within the period of the declaration of emergency to enable unhindered production and supply of fuel and other petroleum products until the completion of the investigation.

Minister Kua said the Essential Services Act imposes very strong penalties against individuals and corporate persons should they fail or refuse to comply with directions issued under the emergency declaration.

He warned that the Government will not hesitate to enforce those penalties.

“I want to reassure all government institutions, business community, and the general public that the Government is prioritising to resolve this energy supply crisis and ensure that normalcy is returned.”