Kumul Petroleum Holding Limited today criticised Puma Energy for leaking to the media the contents a commercially sensitive letter written to the Prime Minister and senior ministers, without the courtesy of informing or consulting KPHL or its Trustee Delegate Minister, Hon William Duma, who were deliberately not copied on the letter.
Kumul Petroleum Managing Director, Wapu Sonk said, “The inference in the letter is that KPHL has not been cooperative. This is in fact far from the truth.”
“KPHL has been negotiating with Puma on long term supply only because they couldn’t sell us spot cargo. For example, when we brought a cargo of 8 million litres of JetA1 from ExxonMobil in early June they didn’t want to buy it because we hadn’t signed their proposed long term supply deal – one that was for almost US$800 million over 24 months at today’s prices.”
Mr Sonk then explained in detail about the shipment KPHL purchased from ExxonMobil.
“The cargo arrived on 1st June and after Puma’s refusal to accept, despite having capacity at Napa Napa, the ship sat in Port Moresby harbour for about 3 days then continued its journey to other PNG ports. Puma eventually agreed to purchase the JetA1, at a discount, to be unloaded in Lae from the 17th June. That is why Puma is having to transport JetA1 from Lae to Port Moresby, and the Air Niugini flight cancellations.”
“The end result of this exercise is that KPHL has lost money due to demurrage costs and having to accept a lower price from Puma for this shipment. It concerns me that KPHL has stepped in to assist the country and fill the gap left by Puma, and yet Puma is attempting to transfer the blame to KPHL.”
“KPHL, acting at the request of the NEC, has brought in three fuel cargoes in recent months, in reality taking on the role of financial institutions, the commercial banks and BPNG, as financier for Puma, a significant financial commitment, to the detriment of our foreign reserves and operational requirements, in order to assist the country address the fuel crisis.”
Mr Sonk explained further, “It must be remembered that PNG’s fuel crisis has been brought about by Puma’s inability to comply with PNG banking practices and other regulatory requirements and to imply through this leaked letter that KPHL is now somehow to blame for fuel shortages is unethical and grossly unfair.”
“The reality is that KPHL operations are constrained by our annual operating plans and only approvals from the KPHL Board and the NEC can enable major transactions outside of these plans. KPHL has made a commercial decision not to engage on long term fuel supply but only on a spot basis.”
“I hope that the approach by Puma in leaking this letter is clearly seen as ‘blackmail’ to put KPHL and the Government under pressure. I reiterate that KPHL will continue to assist in alleviating the fuel crisis, especially for Jet A1, and will do so commercially on a spot basis.”
