Limestone Mining Expert
Period of Performance:
On/about January 1, 2020-April 30, 2020
Place of Performance:
Arawa, Bougainville, Papua New Guinea and remote
INVEST Strategic Investment Advisor
In April 2017, the Office of Private Capital and Microenterprise (PCM) at the United States Agency for International Development (USAID) launched a co-creation process for private sector partners to collaboratively design approaches to blend government funding with private sector capital to improve development impact.
In September 2017 following this co-creation process USAID awarded a contract to DAI as the INVEST apex partner to set up a buy-in mechanism that would allow USAID missions and Washington D.C. offices flexible access to a wide set of partners to support activities aimed at catalyzing private investment.
Papua New Guinea Buy-in Activity
Ninety percent of Autonomous Region of Bougainville’s 280,000 inhabitants have no electricity. Challenges have persisted in expanding electricity service on this remote island in Papua New Guinea with daunting topography and limited physical infrastructure. In Arawa and Buka, the only two towns on the island with grids, PNG Power operates two small, diesel-powered systems on a concessionary basis at a significant loss, charging a 22 cent per kilowatt-hour tariff that is significantly lower than their actual costs.
A private sector solution, however, has emerged that could significantly expand access to clean, affordable electricity on the island at the same time that it generates significant income for the local customary landowners, most of them women in this matrilineal society. An American investor with decades of experience in the power sector has formed a local corporation with these landowners and proposed a 12-megawatt run-of-river hydroelectric utility, building off existing installations on the island that can be recommissioned at limited social and environmental cost. This investor and his local community partners intend to raise $48 million to finance this venture and are in active discussions with the USDFC. The hydroelectric utility will also feed electricity to a proposed limestone mining operation at the former Panguna Limestone Mine. To complement an ongoing feasibility study of the hydroelectric plant, technical experts are sought to complete a feasibility study of reopening this limestone mining operation and its linkages to the hydroelectric plant by completing due diligence with some base line economic, environmental, technical and financial analysis.
The role of the Limestone Mining Expert is to provide technical assistance on any task related to the feasibility report development and finalization. The Limestone Mining Expert will coordinate and work in tandem with a Financial Advisor who will be performing a financial analysis and market assessment. Additionally, the consultant will liaise with a team of engineers supporting a feasibility study of the hydroelectric plant and will provide inputs as needed for the linkages between the two projects. Specific tasks are defined below.
Site visit and work plan
The identified consultants will develop a preliminary concept design, set forth information gathering, plan initial site visits, perform the site visits, and gather and review initial information. Based on this initial data collection and field visit, an inception report will be developed summarizing the initial data, design basis, and methodologies for the field and design work.
A technical analysis of the quarrying and processing plant will be completed by mining experts and will evaluate the material, identify the appropriate equipment and outline the operational scenarios. Elements to be included in the technical analysis include:
- Material Testing
- Overall Site Design
- Process Description for the Limestone Quarry Plant
- Lime Production System and Hydration Plant
- Plant Operations and fuel needs based on the equipment and level of automation
- Project Design Drawings
- General Arrangement Drawing
- Site Plan
- A plot plan of the site with the Quarry plant, New kiln System, Hydration Plant, Office, Amenities.
- PFDs and P&IDs.
- A Process Description for the Limestone Quarry Plant, including recommendations for Mobile equipment such as trucks, bulldozers, and front-end loaders.
- A Process Description for the complete Lime Production System and Hydration Plant.
- A Block Flow diagram of the site with the new plant, showing Quarry Equipment, Limestone Receival, Stockpile, Material Handling, Oil Firing system, Lime kiln, Steel silos for product storage and Hydration Plant.
- A Detailed Process Flow diagram of the oil-fired Kiln System.
The scope of review will include the financing, regulatory compliance, equipment procurement, and scheduling. The implementation plan will be developed though the following general steps:
- Review the overall project and process design and schedule.
- Engage and interview the developer and their onsite construction company for their feedback on the design, resource requirements, access plan, human resources plan, construction capacity and other features.
- Develop milestones for on-site construction and the logistics of delivering new equipment.
- Evaluate obligations and responsibilities of major Project participants, including but not limited to contractors and subcontractors, equipment suppliers, operators, etc.
- Assess the capability and experience of major Project participants to implement the Project.
- Review potential EPC and O&M contracts and subcontract documents and compare with industry best practices. Identify any unusual features and issues which may impact the risk assessment of the Project to the lender.
- Assess the compatibility of the EPC and O&M contract documents with all relevant Project documentation for the purposes of identifying missing, inconsistent or unresolved issues relating to the design, construction, and operation of the Project.
- Assess the combined level of warranties, guarantees and third-party support as compared with industry best practices for construction and for operations.
- Review all other contracts required for the construction and operation of the Project.
- Review the overall construction cost for the Project taking into account the contract price, scope, and terms of the EPC and all of the other Project documents.
- Review the overall operations cost for the Project taking into account the contract price, scope and terms the O&M and any related Project documents. Provide detailed comparative analysis of project costs with other projects of similar size and scope in developing countries.
- Review the assumptions made for the Lender’s cash flow model and confirm their consistency both internally and with regard to the Project documents and that it correctly represents the Project from a technical and cost perspective; recommend downside construction (including cost overrun reserves) and operating scenarios to test Project financial robustness including carbon credit assumptions.
- Based on the input, revise the overall project execution plan.
The consultant will report to the INVEST Strategic Investment Advisor, who will be responsible for technical supervision and acceptance of all deliverables.
PERIOD AND PLACE OF PERFORMANCE
The assignment is anticipated to begin remotely in January 2020 and continue through April 2020. Place of performance will be both in Papua New Guinea and remote.