Pacific Lime & Cement, IFC partner on Papua New Guinea’s integrated clinker, cement facility

Pacific Lime and Cement Ltd has entered a strategic partnership with the International Finance Corp. on Phase 2 of Papua New Guinea's first vertically integrated clinker and cement production facility, aimed at substituting imports and meeting domestic demand, the company said Dec. 16.

Under the agreement, IFC will provide technical, commercial, environmental, and financial advisory support to improve the project's feasibility, refine market assumptions, and strengthen environmental and social management systems to meet global standards, PLC said.

Through the Central Cement Project, PLC aims to produce 1.65 million metric tons of clinker, including about 800,000 mt for sale as clinker and the rest for cement manufacturing, according to the company's factsheet.

The agreement with the World Bank Group corporation is aimed at supporting due diligence and reducing risks in the process of securing financing and building the project in Central Province.

"The project's co-located quarry, plant site and deep draft wharf drive competitive operating costs while providing direct access to both seaborne domestic and export markets such as Australia and other South Pacific nations," it said.

The "engagement recognises the significance of establishing PNG's first fully integrated clinker and cement operation for nation-building," Paul Mulder, Managing Director of PLC, said.

The project was officially launched in August and aims first production in H1 2027.

Once fully operational, CCP aims to replace key import origins for Australia and the surrounding region, with the advantage of lower shipping costs and a reduced carbon footprint due to shorter sailing times.

"Approximately 50% of cement in Australian concrete products is from Asian imports; sourcing cement from PNG is more efficient compared with shipping it from North Asia – positioning PLC to capture value by supplying its own cement into Australia for concrete and building products," PLC said.

Platts, part of S&P Global Energy, assessed Cement Clinker FOB Turkey at $45/mt Dec. 11, up 50 cents/mt week over week.