PNG’s bold nickel play: Madang to become national processing hub

Papua New Guinea is drawing up ambitious plans to turn Madang into the country’s premier nickel processing centre, in a move that would see far more of the nation’s mineral wealth refined on home soil rather than shipped overseas in partially finished form. The proposal, unveiled by Kumul Minerals Holdings Limited, signals a major shift in how PNG approaches its vast nickel resources, with the State-owned enterprise pushing for a domestic refining powerhouse that could reshape the industry.

The vision was laid out in Brisbane on Tuesday by Kumul Minerals Managing Director Sarimu Kanu, who addressed delegates at the Business Advantage PNG Investment Conference. Speaking during a question-and-answer session with Andrew Wilkins from Business Advantage International, Kanu outlined a strategy that hinges on dramatically scaling up the existing Ramu nickel-cobalt operation and building a new refinery capable of turning out nickel cathode and nickel sulphate – two products with booming global demand.

 PNG’s bold nickel play: Madang to become national processing hub/Photo supplied

At the heart of the plan is a near-twofold increase in production at Ramu, lifting output from roughly 32,000 tonnes per year to around 74,000 tonnes. Kanu stressed that the expansion is still dependent on securing regulatory green lights, finalising financing arrangements, and completing detailed engineering work, but he made it clear that Kumul Minerals is pressing ahead with urgency.

“What is unique about that particular strategy in Ramu is that we are driving the expansion of Ramu from about 32,000 tonnes a year to about 74,000 tonnes of nickel produced a year,” Kanu told the room.

Kumul Minerals has already locked in a small stake in Ramu NiCo and is actively pursuing a larger slice. The Independent Consumer and Competition Commission gave its blessing earlier this year to the company’s purchase of a 1.97 per cent participating interest from Mineral Resources Ramu Limited, and Kanu revealed that another 20 per cent is expected to be secured within months, though he declined to elaborate on the specifics of that deal.

Currently, the Basamuk processing plant turns out mixed hydroxide precipitate, but the long-term goal is to climb the value chain. Nickel cathode feeds the stainless steel industry, while nickel sulphate is a critical ingredient for batteries – markets that PNG is keen to tap directly.

Kanu made it plain that the ultimate objective is for nickel to become the first base metal that PNG exports as a fully refined product, rather than in intermediate forms. He also flagged that the existing Basamuk and Kurumbukari operations could anchor new power projects, and that cheaper electricity would be a game-changer for the long-stalled Madang Pacific Marine Industrial Zone, which has struggled to compete using diesel-generated power.

“We want to aggregate all the nickel prospects in the country to feed into the refinery,” Kanu said. “We want to drive the strategy that nickel will be the first base metal that will be exported in metal cathode form. All the processing will be done in PNG.”