Pacific Lime and Cement Advances Central Lime Project with Government Equity and Newmont Offtake

Central Lime Project Hits Major Construction Milestones

Pacific Lime and Cement Limited (ASX:PLA; PNGX:PLC) has marked significant progress on its Central Lime Project (CLP) during the March 2026 quarter, advancing from bulk earthworks to structural civil and foundation works. The project remains firmly on schedule and within its approved budget, with key infrastructure elements such as kiln foundations and access roads moving forward. Concrete pours for kiln foundations have already started, underscoring a critical path milestone towards core processing infrastructure installation.

Crushing and screening operations commenced on-site, reducing reliance on imported aggregates and supporting construction efficiency. Access infrastructure development also gained momentum, with bridge abutment construction and piling activities underway, connecting the Special Economic Zone hosting the CLP to Port Moresby. Meanwhile, batch plant installation was completed and commissioning is underway to ramp up concrete production for structural works.

Camp infrastructure is nearing full occupancy to support the growing workforce, and fabrication for the international export wharf is advancing, with shipment preparations for marine installation in progress. Early-stage sales of high-quality quicklime through an Alliance Partner are helping establish distribution pathways in Australia and the Pacific, providing operational insights ahead of commercial production.

Landmark Project Development Agreement Secures Sovereign Support

During the quarter, Pacific Lime and Cement executed a landmark Project Development Agreement (PDA) with the Papua New Guinea government, ratified by the National Executive Council and formalised by the Governor-General, His Excellency Sir Bob Dadae. This agreement establishes a sovereign framework underpinning the Central Lime and Cement Projects, including fiscal terms and government equity participation.

The PNG Government secured rights to acquire up to an 18% equity interest in the Central Lime Project for US$23.14 million, reflecting a 22% discount to the base project net present value. This equity stake supports long-term development plans, including scaling production capacity from two to five kilns, targeting approximately 1.1 million tonnes per annum. The government also has rights to acquire up to 30% equity in the Central Cement Project at an agreed valuation, supporting a planned dual listing of the cement operation on ASX and PNGX.

Landowners are incorporated into the ownership structure with free-carried equity interests, including 2% direct equity granted by the company and potential allocation of up to 8% of the state's equity to local stakeholders. On a combined basis, the projects could generate EBITDA of around US$178 million (A$249 million) assuming expansion and Stage 2 development scenarios. This sovereign backing and inclusive ownership model reflect a significant step in PNG’s industrial growth and infrastructure development, as detailed in the earlier sovereign backing for PNG’s projects.

Newmont Secures Quicklime Supply with Multi-Year Offtake Agreement

In February 2026, Pacific Lime and Cement signed a cornerstone quicklime offtake agreement with Newmont Corporation, covering approximately one-third of the Central Lime Project’s production capacity. The multi-year contract is contingent on project completion and commissioning, providing a strong commercial underpinning and risk mitigation for the CLP.

Newmont operates major mining projects in PNG, including the Lihir Gold Project and the Wafi-Golpu joint venture. Securing a local supply of high-quality quicklime enhances Newmont’s supply chain resilience, reduces exposure to international logistics disruptions, and aligns with environmental and social governance objectives by lowering transport emissions and fostering local value creation. This agreement builds on the company’s earlier Newmont quicklime offtake deal, reinforcing the strategic importance of local manufacturing capacity.

Central Cement Project Advances Toward Final Investment Decision

The Central Cement Project is progressing steadily toward a targeted Final Investment Decision (FID) later in 2026. Pacific Lime and Cement is collaborating with the International Finance Corporation (IFC), part of the World Bank Group, which is supporting updated feasibility and development planning workstreams.

Preparations for the Definitive Feasibility Study update were completed, with technical reviews, market assessments, ESG evaluations, and financial modelling underway. The project has optimised plant layout and initiated the Environmental and Social Impact Assessment (ESIA). Engagement with IFC has been reinforced through recent site visits by senior IFC officials, aligning on project scope and execution strategy.

Corporate structuring is advancing with discussions on a Special Purpose Vehicle (SPV) to facilitate financing and a potential dual listing. Early supply chain engagement has begun to support future cement and quicklime distribution. These developments continue the company’s efforts to establish PNG’s first integrated cement manufacturing platform, as outlined in the previous IFC partnership on cement project.

Broader Portfolio and Financial Position

Beyond its flagship lime and cement projects, Pacific Lime and Cement is advancing the Orokolo Bay Industrial Sands Project toward execution readiness, with marine logistics and land access progressing alongside community engagement. Its renewable energy subsidiary, Mayur Renewables, is developing geothermal projects following PNG’s new geothermal policy, with positive government feedback and early strategic discussions ongoing.

On the exploration front, a strategic review of the Star Mountains Copper-Gold Project has commenced to explore value realisation options including joint ventures and capital markets transactions. The company also holds a 16.3% stake in Adyton Resources Corporation (TSXV: ADY), which reported significant resource growth and exploration success at its Fergusson Island and Feni Island projects, supporting potential production in the second half of 2026.

Financially, PLC ended the quarter with A$46.05 million in cash, having spent A$11.5 million primarily on Central Lime Project development. Related party payments of A$1.25 million were made for director remuneration. The company maintains a USD 10 million convertible note facility maturing in October 2026, which provides additional capital flexibility.