8 Feb 2007

PNG's Lihir gold mine to develop its own geothermal power plant

7:14 pm on 8 February 2007

The Papua New Guinea gold producer, Lihir Gold Ltd, is commissioning a geothermal power plant expansion at its flagship PNG mine.

Lihir says the 20 megawatt plant would significantly reduce the consumption of heavy fuel oil for power generation and is expected to save the company about 40 million US dollars next year.

The chief executive Arthur Hood says geothermal power was expected to account for 75 per cent of the operation's 2007 electrical requirements and would help to reduce costs.

He says access to low cost power provides the company with a significant advantage, reducing the costs and underpinning the long term future of the project.

Mr Hood says at a projected one cent per kilowatt hour, compared to the current costs of 12 cents per kilowatt hour, geothermal power will provide Lihir Gold with a cheap, reliable and renewable power supply that also offers significant environmental benefits.

Lihir says the geothermal plant would also generate revenues of about three million US dollars annually from the sale of carbon credits on global markets.