Lihir, which is currently working on adding a 20MW facility to its existing 36MW geothermal power station, says it is the first company in PNG to be granted the right to accumulate and trade carbon credits.
“The international organisation responsible for administration of global emissions trading this week confirmed that it had registered the Lihir geothermal power project under the clean development mechanism of the Kyoto Protocol,” the company said in a release to the Australian Stock Exchange Friday.
Lihir said it was now able to begin generating carbon credits which can be sold on global markets.
“At current world prices, the carbon credits are worth approximately $US3 million per year in additional revenues for Lihir Gold,” the company said.
The company expects to reduce carbon dioxide emissions by up to 280,000 tonnes per annum with the geothermal power station providing enough electrical power to run the entire operation.
Lihir Island, located on the Pacific Rim, has an abundant source of naturally occurring underground steam reserves which power the geothermal facility.
“This has been a great project for Lihir Gold, and an environmental landmark for Papua New Guinea,” chief executive Arthur Hood said.
“It is environmentally beneficial, and it provides a cheap source of power to underpin the future expansion of this project and this company. The announcement recognises the benefits of the facility and provides a valuable source of revenue to assist in the implementation of the project.”
The company expects the new 20MW facility to be completed by the end of the year with a future expansion of the facility also being investigated as the company seeks to meet previously announced increased production targets.
Lihir has previously flagged its intentions to reach the illustrious 1 million ounce per annum operation status sometime after 2010.
Lihir produced a total of 596,000oz in 2005 and expects to produce a record 670,000oz this year.