New name, new logo and a renewed sense of direction

Baeau Tai
With the minerals boom, growing economy and the ever changing nature of shipping technologies, the once known PNG Ports Limited is head on with its drive to overhaul its main ports throughout Papua New Guinea.
With a new name—PNG Harbours Ltd—it has given the corporate entity a new sense of direction.

“We are determined to drive the vibrant organisation forward to new heights to achieve what is best for our stakeholders and we will continue the capital maintenance programmes to ensure our ports function to serve our people,” acting chairman, Job Suat, said at the official launch of the company’s new name and logo recently.

Suat said the administrative and operational mechanisms are designed to enable the ports to grow and be the economic nerve centre for PNG.

Despite the vital role the board of PNG Harbours Board is being entrusted to perform in the development of the country, this company has sailed through some rough seas to bring it to what it is now.

Like many other statutory organisations, “the all too common norms of mismanagement both at the political and management levels”, unfortunately did not do any good to the organisation.

Over the years, the company despite having a huge revenue base had continued to operate at successive losses until 2004, when it began to realise profits.

Since then, its revenue has increased and the company continues to make profits and improve its services.

The profits and improved services have been the result of good management with strict expenditure controls.
Since 2000, the organisation’s financial performance has been such that it made successive losses from 2000 to 2003.

Real profit was realised in 2004 when it declared a K18.1 million profit. In 2005, its profit was K7.8 million. There was a fall due to major dredging works at major ports. In September 2006, the profit was K27.75 million.

Its total revenue from 2000 to 2003 fluctuated between K32.0 million and K34.0 million. Then in 2004, its revenue increased dramatically to about K50 million and in 2005 the revenue was K61.54 million.  In 2006, revenue as at September was K52.73 million.

The increased revenue has enabled the organisation to undertake substantial maintenance and capital works at its major ports.   Some of these major capital works include:
• Construction of a new APC wharf, dredging and upgrading of the container terminal at Port Moresby;
• Dredging, Berth 1 restoration, Berth 3 extension, storage area pavement repairs, tanker berth storage area upgrade, installation of a stand-by generator at a cost of K25.11 million in Lae;
• Dredging, pavement resurfacing and overseas wharf extension at a cost of K8.85 million in Wewak; and
• Dredging works planned for Alotau, Rabaul, Kupiano wharf rehabilitation and Oro Bay pavement resurfacing at a cost of K3.57 million.

“With improved financial position, PNG Harbours will continue its capital maintenance programme to rehabilitate its wharves to provide the much needed services at its ports,” Suat said.

A draft report of the PNG Coastal Shipping Industry produced by the consumer watchdog, Independent Consumer and Competition Commission (ICCC), noted that Lae port in particular, is suffering from severe limitations to its capacity—both in terms of wharves and landing areas, in addition to portside services such as storage and transshipment handling areas.

The report said while additional capital expenditure is projected for this port as part of a significant expansion programme, current limitations are putting heavy strain on the international and coastal shipping sectors with consequential additional costs to the economy.

The report said further investment is required as a matter of urgency to many of the ports servicing the coastal areas in PNG.

ICCC noted that based on preliminary estimates, PNG Harbours had spent a considerable amount on maintenance and new facilities in the last five years.

Actual expenses on capital projects since 2000 are: K3.2 million in 2000; K2.7 million in 2001; K4.4 million in 2002; K1.8 million in 2003; K6.0 million in 2004; K3.4 million plus another K11.0 million on dredging in 2005; and K15 million up to November 2006.

PNG Harbours is a fully corporatised entity owned by the state. The Independent Public Business Corporation is the sole shareholder. It holds shares in the company in trust for the state.