Tag Archives: Mt Kare

Government blindly pursuing a failed model of development

Even the United Nations has warned more mining activity in PNG will NOT improve the lives of ordinary people – but Byron Chan and the O’Neill government don’t care. Instead they are rushing ahead with five new major mines. So who will take the profits? A small elite of politicians, lawyers and bureaucrats in PNG and the global mining companies – and unfortunately they are the ones who seem to be running the whole show…

More projects ahead

Gorethy Kenneth | Post Courier

PAPUA New Guinea expects to see about five mining development projects with a combined capital investment expected to exceed $US 10 billion or over K25 billion within the next decade.

The country’s 22-year old mining legislation and its policies will be revised so it can accommodate those projects, Mining Minister Byron Chan has announced.

Speaking in Sydney at the Mining and Petroleum Conference, Mr Chan also said the most significant initiative of the Government and the Mining Ministry is the development and implementation of several key mining policies and the subsequent revision of the current mining legislation.

He said PNG currently has 12 mining operations approved under special mining lease or mining lease tenements which have advanced to production or are at the development stages.

Within the next decade alone, we expect to witness the development of the following projects: Frieda copper, Wafi/Golpu copper, Yandera copper molybdenium, Mt Kare gold and a host of other alluvial mining projects

“These may include known mineral sands, nickel, coal and gold, silver and copper deposits. “I can report that progress is being made on the finalisation of the policy development, with the revisions of the mining act and regulations to follow.

“Working groups, comprising state and industry representatives, are now refining the policy settings and moving towards settlement of key issues and final drafting,” Mr Chan said.

“The sustainable mining policy is completed. “The geothermal policy, subject to the reservations already expressed, is also completed.

“It remains this Governments’ intention, to present the remaining policies for cabinet approval, and this legislation, to parliament mid next year.

“The Prime Minister has already given his assurance to industry and potential investors in the mining sector of PNG that policy settings will be progressive, based on best practice and allow compromise between competing interests,” he told the conference.

“They will build upon the template of the success of the current legislation, by providing the right mix of incentives and practicality to ensure a balanced regulatory regime to underpin the next generation of mineral investment in PNG,” he said.

“Finally, the most significant initiative of Government is the development and implementation of several key mining policies and subsequent revision of current mining legislation,” he said.

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Indochine makes breakthrough at Mt Kare in PNG

indochine-logging-drill-core

INDOCHINE logging drill core at Mt Kare in Papua New Guinea. The company signed a “groundbreaking” land agreement with local landholders this week, ahead of a recapitalisation of the company, according to insiders. Photo: Indochine Mining

Global Mining Observer

ASX-listed Indochine Mining is set to announce a financial recapitalisation of the company before the end of the year, Global Mining Observer has learned, after securing a breakthrough land deal with local tribes this week at its Mt Kare gold project in Papua New Guinea.

In a ceremony marked by “singsing” and “pig killing”, Indochine ended a 30-year land ownership dispute with local tribes on Tuesday. The news is seen internally as a “groundbreaking” moment in securing the future of Mt Kare, a bonanza grade gold asset in the politically volatile world of Papua New Guinea.

In conjunction with an equity raising, the company is working on a debt-to-equity swap with its secured creditor, according to sources involved, pumping money into the company, removing its debt overhang and kickstarting mine construction.

Indochine announced a boardroom overhaul in July, thought to have had the backing of underground mine contractor Brian Rodan, the company’s largest shareholder.

Valued at A$23m ($20m), or A$1.9c per share, the market appears to be pricing the company for liquidation, but in response to questions this week, interim chairman and restructure specialist Dermott McVeigh said he is “extremely confident that we’ll be here in not just 18 months, but that we will develop this project.”

The company has had expressions of interest for the full acquisition of the asset, according to McVeigh, but Indochine is “exactly the vehicle” to develop Mt Kare, he said. “The main reason I say that is because of the approach the company has taken to our relationship with landowners. On the ground in PNG, it makes an enormous difference.”

Mt Kare sits along trend from Barrick Gold’s giant Porgera mine, yielding 17m gold ounces since opening in 1990. The mine produced 482,000 ounces last year, but Barrick recently downgraded its mine life from 13 to 9 years and is trying to offload the asset, according to sources.

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Indochine share price tumbles after Mt Kare landowners declare their opposition

The share price of Australian mining company Indochine Mining has tumbled since landowners from its flagship Mt Kare project declared their opposition to the company on this blog two weeks ago: Mt Kare landowners call on government to cancel exploration licence.

Landowners say studies done by Indochine do not accurately provide for the cultural and traditional land owners of Mt Kare and they have asked the government to not to renew the company’s exploration licences

graph showing share price fall

IDC share value has tumbled since landowners voiced their opposition

The Indochine share price has dropped over 20% from 3.4 cents in the days before the story was published to just 2.7 cents today. Even more dramatic, shares in the company have lost almost 30% of their value from their August high of 3.8 cents one week before the story broke.

graph showing share price over 12 months

Current Indochine share values are a far cry from the heady highs of March. Since then the shares have crashed, loosing more than 65% of their 7.7 cent value.

Indochine Mining says it is engaged in the exploration and development of gold, silver, and copper mineral properties in Papua New Guinea and Cambodia. Its flagship property is the Mt Kare gold/silver project. The Australian Stock Exchange website says the company is based in Sydney, Australia and its two key executives between them earn over $700,000 a year.

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Mt Kare landowners call on govt to cancel exploration licence

kappa man

Mt-Kare-in-Papua-New-Guinea

Mt Kare exploration zones

The previous results of the Indochine/Summit Land owner study does not accurately provide the cultural and traditional land owners of Mt Kare.

We the Incorporated Land Groups of our Mt Kare land area EL1093 have requested MRA and the PNG Government to cease any license renewal to this Indochine/Summit circus, and do not authorise any current PNG Government/PM to consent these 2 companies to our EL1093.

The majority of the IDC board has recently resigned, IDC is being managed by an Accountant, who have moved IDC offices to Perth.

The ASX IDC share price is being manipulated and still is only gathering capital to feed its management.

Mt Kare ILGs have irrevocably dismissed any leases or authorisation to IDC/Summit.

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Summit Development gets LO’s praise for Melanesian approach

Mt Kare landowners

Mt Kare landowners

Post Courier

A principle landowner of Mt Kare gold and silver project praised the Summit Development limited for the inception of Melanesian approach strategy.

Chief of Yolo clan and principle landowner of Mt Kare in Enga province, Andiki Hayagu said he was very pleased with the Melanesian approach theory which was put in place to counter the white-man’s imaginary boundaries to identify the true landowners.

“It’s awesome to learn that the Melanesian Approach’ theory about using customary landownership methodology was put that rest the landownership issues,” Chief Hayagu said.

He said under the theory, the Landowner Investigation Study (LIS) was successfully underway on-site at Mt Kare, which included the marking out, on the ground and location of the land boundaries amongst the clans identified in the LIS.

“It was being surveyed as required by the Lands Act to be included in the final submission of the Landowner Investigation Report (LIR).

“Therefore, all principle landowners of Mt Kare from both Enga and Hela provinces need to have patients because I don’t see any logic why landowners should make information to obstruct the amazing work done by the licensee,” he said.

Chief Hayagu added that in depth commitment shown by the licensee was unusual and unique which past exploration companies failed to produce results.

“Landowners must be aware and advised and be mindful of the sensitivity and expectations that the issues of mineral ownership were addressed through the Land Identification Report (LIR) development and only the ones validated by the LIR will be recognized by both customary and State law.

“Many have formed organizations recently but are driven by individuals rather than clans identified as landowners of Mt Kare, However, they will still fail one day,” chief Hayagu said.

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Mt Kare miner out to raise millions

Freddy Mou | PNG Loop

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Indochine Mining Ltd has announced an equity capital raising of A$3.1 million (K6.67m) via a private placement of 73.4 million new IDC shares at $0.042 (K0.09) per share.

The placement is being made mainly to major existing institutional and sophisticated investors and new investors.

Chief executive officer Stephen Promnitz said the funds will provide working capital to allow the company to advance ongoing discussions with potential parties interested in investing in the company and the flagship high grade Mt Kare gold project in the Highlands.

“While most of our emphasis is on administration and corporate functions right now, it is important for shareholders to understand that we have to keep the project in good standing and that means keeping our site secure, our people on site gainfully employed, and our administrative and corporate function operating,” he said.

“It is also important to note that these are challenging market conditions for many junior exploration and development companies. However, Indochine has been able to count on the support from many of its shareholders, some of which are very large funds, and this gives us a clear distinction in the market. This is again a very strong endorsement of the unlocked value inthe Mt Kare project. “

The funds also will be used for working capital, exploration and project development, which is anticipated to partly include advancing a production scale development drive, associated drilling and sampling, and related access.

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Indochine Mining investors lose patience and force out board

Brian Robins | Sydney Morning Herald

Interests associated with Brian Rodan’s Australian Contract Mining are believed to be behind a board coup at Indochine Mining, which has been battling to develop the giant Mt Kare gold deposit in Papua New Guinea, which a Rio predecessor, CRA, famously abandoned 20 years ago.

Indochine has been seeking to raise funds from a cornerstone investor for months – most recently, it is believed, from China – to help it get the project under way.

But investors lost patience, on Thursday forcing out the recently installed chairman, Hugh Thomas, along with the chief executive, Stephen Promnitz, and another director, Robert Thomson.

In their place, a restructuring specialist, Dermott McVeigh, has been appointed the chairman.

Trading in Indochine shares has been suspended, with the company saying it is in discussions with “a substantial shareholder” regarding the future funding of the company.

In mid-2013, Mr Rodan’s Australian Contract Mining was brought in to handle plans to launch underground mining, with another Perth operator, GR Engineering, brought in for a range of engineering and construction advisory work on the project.

It is believed that Mr Rodan has about a $10 million exposure to Indochine, through a direct holding in its equity along with a loan facility provided to the company.

At the time, Indochine claimed it had boosted the size of the Mt Kare resource to 2.5 million ounces of gold equivalent, along with the outlining of some high-grade zones. The intention was to focus on extending these high-grade zones since they presented the option of a low-cost underground mine at lower costs than its earlier feasibility studies had indicated.

Subsequently, Indochine claimed it was targeting producing up to 200,000 ounces of gold annually at grades of 10 grams of gold a tonne from early 2015, at an all-in capital cost of less than $100 million, arguing the Mt Kare deposit bore many similarities with the nearby Porgera mine operated by Barrick mines.

But the decline in the gold price, which exacerbated fund-raising difficulties, slowed work on the project.

In March, for example, Indochine signalled a $20 million raising at 9¢ a share, which included selling a stake to a cornerstone investor along with a direct stake in the mine, although ultimately the issue raised just $3.4 million.

The shares last traded at 2.7¢, well below the most recent issue price.

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