Company Interview / Small cap teams up with PowerChina in PNG

Key Points:

PowerChina PNG becomes development partner for Arakawa Bay Magnetite Sands projectPacific Units replaced due to internal issues impacting project timelineCentral lime and cement project is progressing debt-free and on budgetProximity to ExxonMobil’s PNG LNG facility supports efficient logisticsStake in Synergy Alliance secures skilled construction workforce

Pacific Lime and Cement has secured PowerChina PNG as its new development partner for the Arakawa Bay Industrial Magnetite Sands project in Papua New Guinea. Paul Mulder expresses enthusiasm about this agreement, noting Power China PNG’s reputation as one of the world’s largest EPC construction companies. Under the arrangement, PowerChina PNG will provide development funding, working capital, and operational support, while Pacific Lime and Cement retains full ownership of the asset and 60% of future profits. Mulder sees this as an excellent outcome for shareholders, allowing the company to drive value without balance sheet risk.

Mulder explains that this partnership replaces a previous arrangement with Pacific Unison, which was terminated due to internal challenges at Pacific Unison that threatened project timelines and cash flow targets. With PowerChina PNG on board, Mulder says Pacific Lime and Cement can focus on advancing its central lime and cement project, now under construction and tracking well both on time and on budget. He highlights that the project is fully equity-funded and debt-free, providing a unique risk profile compared to industry peers such as Wagners (ASX:WGN).

On project logistics, Mulder points to the strategic coastal location near ExxonMobil’s PNG LNG facility, which enables efficient development and operations. An equity stake in construction company Synergy Alliance provides direct access to skilled labour, further de-risking the undertaking.