Pacific Lime and Cement is looking for strategic investors to develop a 1.8-billion-litre diesel and jet fuel storage facility at its Kido port in Papua New Guinea, a move intended to enhance energy security across Australia, PNG, and the wider Pacific region.
The company has finished a feasibility study for the project, which would accommodate 11.25 million barrels of fuel distributed across 52 tanks on a 70-hectare waterfront site. Located 35 kilometres from Port Moresby, the proposed storage hub sits within the 4,500-hectare Kido/Rearea Special Economic Zone (SEZ). This initiative supports Australia’s broader efforts to strengthen fuel supply chains following recent global disruptions.
The first phase would consist of 41 diesel tanks and 11 jet fuel tanks, occupying roughly 46 hectares of the site. The development would utilise Kido’s deep-water port, which features two liquid bulk berths and ongoing infrastructure improvements. Mayur Industrials PNG Limited (MIPL), an 87%-owned subsidiary of Pacific Lime, holds the 99-year land leases required for the project, with liquid fuel storage explicitly permitted under the SEZ’s licensing framework. The PNG government maintains a 13% stake in MIPL.
Australia’s daily diesel consumption averages 92 million litres, while jet fuel demand stands at 26 million litres annually, based on 2025 projections. The Kido facility, if constructed, would exceed Australia’s planned one-billion-litre government-controlled fuel reserve, announced in May as part of a $3.2 billion national security package, by nearly double. However, Australia’s reserve target of 50 days of stockpiled fuel does not automatically include PNG-based storage unless formal intergovernmental agreements are established.
The reserve’s geographic positioning provides a distinct advantage: it lies 1,830 nautical miles from Australia’s east coast, roughly half the distance to Singapore. Laden tankers could reach Townsville in two to three days and Sydney in six to seven days, offering faster transit than Asian supply routes. The project could expand in three phases, contingent on funding availability, market demand, and regulatory approvals.
Pacific Lime and Cement is adopting a capital-light approach, where external partners would fund construction and retain ownership of the fuel infrastructure. The company will not finance Phase 1’s tank farm development from its own balance sheet, though it expects to contribute to shared landlord infrastructure costs. Potential revenue streams for MIPL could include lease agreements, sublicensing arrangements, and port-related income, all subject to finalised contracts.
The proposal follows Australia’s recent policy shifts, including the establishment of a $7.5 billion Fuel and Fertiliser Security Facility and a 10-day increase in mandatory industry reserves. While Australia’s reserve policy targets 90 days of net import coverage, aligned with International Energy Agency standards, the Kido facility could supplement regional storage capacity, reducing dependence on Asian supply chains.
