PROJECT UPDATE: PMIA PRIVATE PUBLIC PARTNERSHIP (PPP)

BACKGROUND

The Government of Papua New Guinea (GoPNG) has approved the National Airports Corporation’s Redevelopment of Port Moresby (Jacksons) International Airport (PMIA) to develop and operate the airport as a world class international airport in the region by a Private Public Partnership (PPP) arrangement. A Master Plan was prepared by Jacobs Consulting in 2008, which estimated total annual traffic to be 2.5 million by 2030.

The ADB, through its Office of Public Private Partnership (OPPP) has been mandated by National Airports Corporation (NAC) of Papua New Guinea (PNG) to advice on the proposed brownfield development and expansion of PMIA for PPP.

The PMIA PPP Project was initiated and endorsed by the NAC Board and subsequently approved by the GoPNG National Executive Council. A major milestone was achieved on the 02/03/2017 where Asian Development Bank (ADB) advanced their Transaction Advisory Services team (TAS) to prepare the groundwork for the commencement of the project.

ASIAN DEVELOPMENT BANK

The ADB is the mandated PPP transaction advisor to the NAC in relation to the development and operation of the PMIA. This also includes advice for related infrastructure and facilities required to meet forecast air services growth for the next 30 years using a PPP scheme.

ADB will procure and engage the services of a Consultant firm as the Technical Advisor to execute the Project.

ADB TAS scope includes:

- reviewing NAC’s existing feasibility study and assist the NAC in updating it,

- preparing the Project for two staged tender process, and

- assisting the NAC in both running a competitive tender process as well as in the selection of preferred bidder and negotiation leading to signing of the concession agreement and financial closure.

The Technical Advisor (Consultant) engaged by ADB will directly support the TAS team for the Project. The main objective is to carry out technical studies, develop technical specifications for the concession structure and assist ADB during the bidding process.

The scope of services is divided into two phases:

Phase 1: update and review the existing pre-feasibility studies and prepare a feasibility study for the Project including PPP options analysis; and

Phase 2: support ADB and the NAC during the prequalification stage of the PPP transaction, bidding process, bid award and financial close.

The Consultant will deliver a feasibility study for the Project, including detailed traffic forecast over a 30 year projection period, which will be used to verify the scope of the Project and to assess viability of the Project as a PPP. The Consultant will develop the feasibility study taking into account issues relating to the technical, financial, commercial, social, environmental, and other relevant considerations, and conclude with an approved transaction structure.

Consultant Services Terms of Reference

(i) prepare a feasibility study for the expansion and development of new passenger terminal facilities;

(ii) define the technical and commercial parameters of the expansion;

(iii) determine the appropriate PPP modalities and commercial structure;

(iv) support NAC during the Project development with technical and operational expertise including supporting NAC’s capacity building;

(v) invite the private sector for the development of the project and;

(vi) bring the project to commercial and financial close.

PROJECT SCOPE

The Consultant will review the existing pre-feasibility studies and will deliver a feasibility study for the Project taking into account issues relating to the technical, financial, commercial, social, environment, and other relevant considerations. The feasibility study will look into the following components:

- Traffic forecast

- Owner’s Requirements Analysis

- Technical Assessment and Solutions

- Environmental and Social Impact Assessment

- Economic and Financial Assessment

- Model

- Transaction Structuring

- PPP Project Scope

PROJECT STATUS

Status update for the PPP Project: 

1. Consultant Terms of Reference completed

2. PPP Scope and application for ADB funding completed

3. TAS preparing to tender for Consultant Services

PROJECT SCHEDULE

Tentative Timeline

Phase 1: April 2017 – November 2017

Phase 2: October 2017 – June 2019