PNG MINERAL EXPORT EARNINGS ON RISE

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By Baeau Tai

PORT MORESBY, Papua New Guinea (The National, Mar. 31) - There has been a slightly increasing trend in mineral export receipts over the past three years.

Total receipts for 2004 were K5.9 billion (US$1.9 million), an increase of 1.1 percent from K5.8 billion (US$1.8 million) in 2003 and 23.3 percent up from K4.7 billion in 2002.

The Central Bank reported in its 2004 December quarterly economic bulletin that last year's increase was due to higher kina prices of all mineral exports, which more than offset declines in export volumes.

Gold export volumes were 66.2 tons in 2004, a decline of 3.2 percent from 68.4 tons in 2003. The decline was due to lower production from all the mines, except Lihir Gold, resulting from the mining of lower ore grades combined with declines in shipment.

The average free on board (FOB) price for Papua New Guinea's gold exports was K41.6 million (US$13,370 million) per ton in 2004, 1.2 percent higher than in 2003. The increase reflected higher international prices, which more than offset the effect of the appreciation of the kina against the US dollar.

The decline in the export volume more than offset the increase in the export price, resulting in a decline in export receipts by 2.0 percent to K2,755.9 million (US$885,000) in 2004, compared to K2,811.2 million(US$903,000) in 2003.

Copper export volumes were 173.9 thousand tons in 2004, a decline of 24.6 percent from 230.6 thousand tons in 2003.

The decline was due to lower production and shipment of copper ore from the Ok Tedi Copper mine as a result of lower water levels at Fly River.

The average FOB price of PNG's copper exports increased by 44.7 percent to K8,880 per ton in 2004, due to higher international prices.

The increase in the export price more than offset the decline in export volume resulting in an increase in export receipts by 9.1 percent to K1,544.2 million in 2004, compared to K1,415.0 million in 2003.

Crude oil export volumes were 12,395.1 thousand barrels in 2004, a decline of 17.3 percent from 14,983.4 thousand barrels in 2003.

The decline was attributed to a lower extraction rate from wells at the Kutubu, Gobe Main and South East Gobe oil projects reflecting the natural decline in reserve levels.

The average export price of crude oil increased by 20.2 percent to K131 per barrel in 2004.

The decline in the export volume more than offset the increase in the export price and resulted in a marginal decline in the export receipts by 0.4 percent to K1,625.2 million in 2004, from K1631.9 million in 2003.

April 1, 2005

The National: www.thenational.com.pg/

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