31/07/2026
DUMA'S LEGAL STRATEGY ON THE PPAs WILL EVENTUALLY BE RECOGNIZED.
Much has been said about the controversial Power Purchase Agreements (PPAs), particularly the Dirio and Munum agreements. What is often overlooked is the legal strategy adopted by former Minister Duma during his tenure.
Recognising the significant financial implications of these agreements, Duma moved decisively through Kumul Consolidated Holdings (KCH) to engage reputable law firms to review all PPAs involving PNG Power Limited (PPL). This was not a political exercise but a calculated legal response to contracts that had the potential to impose substantial liabilities on the State.
The Dirio PPA became the subject of litigation after Dirio commenced proceedings against PPL and KCH in the National Court. The Court reaffirmed an important legal principle: PNG Power Limited is a separate corporate entity governed by its own Board and Management. The Court also noted that the Dirio PPA had received National Executive Council approval and had been executed by the then leadership of PPL, including the Acting CEO/Managing Director, J. Mangos, and Chairman Peter Nupiri, together with Dirio's directors.
The consequence of that finding was significant. The Court viewed the agreement as a binding commercial contract and ordered PPL to pay approximately K180 million to Dirio. While many focused on the judgment itself, Duma's response demonstrated that he understood the legal and institutional realities surrounding PPL.
As Minister, Duma could not simply direct PPL to challenge contracts that had already been executed by its own Board.
The law recognises PPL as an independent legal entity, and ministerial powers have clear limits. Rather than attempting to interfere with the company's governance, Duma used the legal standing of KCH, as the shareholder, to initiate court proceedings where appropriate.
That strategy also extended to the Munum PPA, which was challenged through KCH. Both matters have been placed before the courts, reflecting an approach that sought to work within the law rather than around it.
Following the National Court decision, Duma instructed PPL's legal team to prepare an appeal to the Supreme Court. However, before the appeal process could proceed under his leadership, ministerial responsibility was transferred to Minister Maru.
Minister Maru has inherited legal proceedings that were already underway. Rather than starting from scratch, he now has the opportunity to continue the work that was initiated before his appointment.
In politics, it is easy to judge outcomes without appreciating the legal constraints that shape government decisions. Duma could not rewrite contracts that PPL had already signed, nor could he disregard the corporate independence of a State-owned enterprise. Instead, he pursued what he considered to be the most effective legal avenue available through KCH.
Time will ultimately determine the outcome of the court proceedings.
However, if those challenges prove successful, history may well record that Duma's greatest contribution was not making the loudest political statements, but quietly laying the legal groundwork to protect the State's interests within the framework of the law.
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Hon. Jelta Wong MP
Hon Jason Peter member for Huon Gulf, MP
Hon. Richard Maru, MP