Puma Energy PNG Ltd has announced the implementation of temporary supply restrictions, effective from midnight on January 25, 2024.
Puma Energy PNG Ltd Chairman & Managing Director, Hulala Tokome made this known in an official notice to its aviation customers on Wednesday, January 24. The move comes as a result of an ongoing issue with its primary banking services provider, Bank South Pacific (BSP), which withdrew access to banking services on January 19, 2023.
“Despite efforts to delay supply reductions, Puma Energy is now compelled to limit ordinary daily demand, with a focus on accommodating emergency supplies as long as the remaining stock allows,” According to Puma Energy.
This measure is a response to the inability to fulfill obligations under supply agreements, citing the situation as a greater force event.
The banking predicament has left Puma Energy unable to order further fuel stock from international markets, as uncertainty looms over the ability to pay suppliers. Puma Refining, the primary supplier and affiliate, is also forced to curtail operations, exacerbating the fuel supply crisis in Papua New Guinea.
In response to the escalating crisis, Prime Minister and Treasurer James Marape addressed the nation's fuel security during a crucial meeting with BSP CEO Mark Robinson on January 23, 2024. Emphasizing the potential threat to national security, Marape urged that the Puma Energy issue should not be allowed to escalate further. The BSP notice directing the closure of Puma Energy's accounts by March 8, 2024, adds urgency to the situation.
During the meeting, Marape revealed that the Bank of Papua New Guinea is actively investigating the matter, collaborating with stakeholders to find a favourable resolution. The government is exploring alternative fuel suppliers and implementing strategies to strengthen foreign exchange reserves to address challenges posed by the Puma Energy issue.
Expressing concern for the country's economy, Marape highlighted the need to retain a significant portion of export revenue within the country to bolster foreign exchange reserves. The government remains committed to resolving the national fuel security crisis promptly, ensuring stability in the country's economic landscape.
As discussions continue, stakeholders are hopeful for a swift and comprehensive resolution to prevent further disruptions.