Pacific Lime and Cement (ASX:PLA) said the project development agreement for its Central lime and cement project was formally initialed by the state negotiating team, representing the Papua New Guinea government, on Tuesday and publicly declared by its minister for international trade and investment, Richard Maru, according to a Wednesday Australian bourse filing.

The agreement will be ratified by the National Executive Council, following which it will be signed at Government House by the Governor General, Bob Dadae. The legally binding agreement provides the legal and policy framework for project implementation, while building upon and finalizing the community development agreement initialed in February.

The Papua New Guinea government will have the right to acquire a 13% equity stake in each of the project's two special purpose vehicles, Quicklime and Cement, with a further 5% option in each vehicle exercisable post-commissioning for each production facility.

The project was granted full special economic zone fiscal treatment, including corporate tax concessions, import duty relief, and contractual stabilization provisions. It was also formally deemed a development of National Significance under the Organic Law on Provincial Governments and Local Level Governments.

The firm's shares rose 6% in recent trading on Wednesday