Pacific Lime and Cement Limited has secured a strategic advisory partnership with the International Finance Corporation to advance Papua New Guinea’s inaugural vertically integrated clinker and cement production project.
- Strategic partnership formed with IFC, part of the World Bank Group
- Project aims to establish PNG’s first fully integrated clinker and cement facility
- IFC to provide advisory support across technical, commercial, and ESG areas
- Effort to align project with international standards for financing and sustainability
- Project targets import substitution and domestic market supply in PNG
A Landmark Step for PNG’s Cement Industry
Pacific Lime and Cement Limited (PLC) has announced a pivotal collaboration with the International Finance Corporation (IFC), the private sector arm of the World Bank Group, to support the development of its Phase 2 Central Cement Project in Papua New Guinea’s Central Province. This partnership marks a significant milestone for PNG, as the project is set to become the country’s first vertically integrated clinker and cement production facility.
The initiative is designed to reduce PNG’s reliance on imported cement by establishing a local manufacturing base capable of meeting domestic demand. This aligns with broader national goals of fostering industrial self-sufficiency and economic development.
IFC’s Role – Expertise and ESG Standards
IFC’s involvement brings a wealth of global expertise, particularly in emerging markets, and a strong emphasis on environmental, social, and governance (ESG) standards. Their advisory support will focus on four integrated workstreams – updating feasibility studies to ensure bankability, refining market and financial assumptions, and enhancing environmental and social management systems.
These efforts are crucial for de-risking the project and positioning it to attract international financing. IFC will also assess and recommend improvements to PLC’s Environmental and Social Management System, aiming to meet IFC Performance Standards; a key requirement for multilaterals and global financiers.
Strategic Implications and Future Outlook
Paul Mulder, Managing Director of PLC, highlighted the significance of IFC’s engagement, noting it as recognition of the project’s transformational potential for PNG’s industrial landscape. The partnership not only enhances the technical and financial credibility of the project but also underscores PLC’s commitment to sustainable development and community engagement.
Beyond cement production, PLC’s broader strategy includes supporting decarbonisation efforts in the Asia-Pacific region through diversified renewable energy initiatives and nature-based solutions. This integrated approach positions PLC as a forward-thinking player in the materials sector, balancing growth with environmental responsibility.
While the announcement does not specify financing timelines or capital expenditure details, the collaboration with IFC is expected to accelerate due diligence and funding processes, bringing the project closer to construction and eventual operation.
Bottom Line?
With IFC’s backing, Pacific Lime and Cement is poised to transform PNG’s cement industry, but key financing and construction milestones remain ahead.
Questions in the middle?
- What is the anticipated timeline for securing full project financing and commencing construction?
- How will the partnership with IFC influence the project's capital expenditure and cost structure?
- What specific ESG improvements will be implemented to meet IFC Performance Standards?