The buck stops with Mr O’Neill on Bougainville

O'Neill and Momis pose

O’Neill and Momis (photo Tony Kaybing)

Bougainville Freedom Movement

On 12 January 2016, Papua New Guinea’s prime minister, Peter O’Neill, took on the portfolio of Bougainville Affairs in his latest cabinet reshuffle. Mr O’Neill says this is because the autonomous region is a top priority for the government as it heads towards a referendum on possible independence.

The Leader of the Opposition Don Polye queried the motive behind the Prime Minister Peter O’Neill giving himself the Bougainville Affairs Ministry in light of the looming vote on a referendum. Don Poyle then described the minor reshuffle as ‘self-serving and not in the best interest of the country.’

Then on 21 January 2016, Papua New Guinea opposition MP Sam Basil warned about the prime minister Peter O’Neill’s interest in the Panguna mine in Bougainville.

“Mr O’Neill last month (December 2015) met with the president of the autonomous Bougainville region, John Momis, over a reported government proposal to purchase 53% of Rio Tinto’s shares in Bougainville Copper Limited.
Mr Momis, whose administration has been in recent discussions with BCL about a possible re-opening of the mine, rejected the proposal. The prime minister has since denied that the government is interested in buying in on Panguna.”

But Mr Basil says Mr O’Neill’s latest move to appoint himself Minister for Bougainville Affairs is ominous.

“With his actions, in terms of dealing with other mines – Tolukuma and Ok Tedi – I think the people of Bougainville should be very wary of the prime minister’s actions, and they should be very careful on how they allow the prime minister to deal with their mine. So we should be very careful with Mr Peter O’Neill. He has lied to us many times.”
See

It is very interesting now that the President of Bougainville, John Momis doesn’t mind that Peter O’Neill is the Minister for Bougainville Affairs because “the advantage is that the buck stops with Mr O’Neill, so there can be no excuses”.

But O’Neill has already stopped the bucks.

On 29 December 2015, John Momis said many millions of dollars is owed to Bougainville as per the peace agreement concluded with PNG in 2001.

In a lengthy statement, Mr Momis says his government estimates that PNG has underpaid Bougainville for the recurrent unconditional grant and owes at least US$33 million dollars, which must be paid immediately.”

“The president says Bougainville is owed another US$207 million under the Restoration and Development Grant. Mr Momis says the national tax office is also failing to hand over taxes collected in Bougainville.”

Is the PNG Prime Minister Peter O’Neill and his government holding President John Momis and the people of Bougainville to ransom?

Are Rio Tinto and Bougainville Copper Limited (BCL) influencing the PNG Prime Minister?

Leave a comment

Filed under Financial returns, Papua New Guinea

21st Century Colonialism: EU seeks profit from the seabed

polymetallic nodules

polymetallic nodules

E.U. Deepsea Mining Project Launched

The Maritime Executive | 05.02.2016

The European Commission is funding a deepsea mining project involving an international European consortium of industry and research organizations.

The Blue Nodules project, launched on February 1, is part of the Horizon 2020 program, which is helping to accelerate innovations that ensure secure and sustainable deepsea harvesting and processing of polymetallic nodules.

Polymetallic nodules occur on the seabed in most oceans around the world and contain large quantities of critical raw materials, such as nickel, copper, cobalt and manganese, as well as gallium and rare earth elements. They are vital for Europe’s innovative technologies, for manufacturing crucial alloys and for new and innovative products like batteries for electric cars, photovoltaic systems and devices for wind turbines. The project is part of E.U. recognition of the strategic importance of a sustainable supply of these raw materials.

The extreme conditions found on the ocean floor raise specific technical and environmental challenges, which are demanding and entirely different from land-based mining. To meet those challenges, the project will develop the seafloor and surface processes and equipment for sustainable deepsea harvesting of the nodules.

This project addresses the challenge of creating a viable and sustainable value chain to retrieve polymetallic nodules from the ocean floor. It will develop and test new highly-automated and sustainable technologies for deep-sea mining with minimal environmental pressures.

The technical side of the project is dedicated to subsea harvesting equipment in addition to the insitu seafloor and sea surface processing of polymetallic nodules. The operational aspect focuses on sea operations and logistics, including compliance with, and development of, rules and regulations, and the business case.

The independent, dedicated environmental part will focus on environmental pressures and on an Environmental Impact Assessment. In all areas, Blue Nodules will build on the results of the European FP7 projects, MIDAS and Blue Mining and the EcoMining pilot action funded by the JPI Oceans initiative of the European science foundations.

Rodney Norman, Director at IHC Mining, which is coordinating the project, explains that Blue Nodules is significant because it allows the European consortium to expand technological development beyond the vertical transportation system of the earlier Blue Mining project to the seafloor mining vehicle and other components of the system.

DEME, through Dredging International, is one of the industrial partners. On January 14, 2013, the International Seabed Authority signed a 15-year contract with DEME’s subsidiary Global Sea Mineral Resources (GSR) for the prospecting and exploration of polymetallic nodules. Under the contract, GSR has exclusive rights for exploration over 76,728 square kilometers of seabed in the eastern part of the Central Pacific Ocean.

Blue nodules is the third E.U. initiative that DEME has participated in, in addition to the Midas and Blue Mining projects.

Other project partners include:

Continental AG, United Kingdom & Hungary
IHC MTI, The Netherlands
De Regt Marine Cables, The Netherlands
Uniresearch, The Netherlands
Seascape Consultants Ltd., United Kingdom
GSR, Belgium
Bureau Veritas, France
NIOZ, The Netherlands
RWTH Aachen, Germany
NTNU, Norway
Aarhus University, Denmark
UPC, Spain

1 Comment

Filed under Financial returns, Pacific region

Ok Tedi board approves PNG copper mine restart from March 1

The mighty Fly River twisting through the Western Province

The mighty Fly River twisting through the Western Province

Melanie Burton | Reuters | 5.02.2016

Papua New Guinea copper miner Ok Tedi Mining Ltd said its board has approved a restart of its operations on March 1, more than five months after the mine was put on care and maintenance when drought cut off its transport links.

The move will bring further metal to a copper market which is already reeling from a prolonged downturn in prices and a surge in mine supply just as demand from China cools, forcing high cost producers to cut output or shut down.

Ok Tedi, which declared force majeure on its sales contracts on Aug. 17, said at the time that it expected to lose 65,000 tonnes of copper in concentrate after the El Nino weather pattern sank river water levels.

“Our plans for the progressive restart of operations on 1 March 2016 were today approved by the OTML Board of Directors,” Managing Director Peter Graham in a statement on its website on Friday.

The company was still awaiting safety approval from the country’s Mineral Resource Authority prior to the restart, the statement said.

Drought made river traffic on the Fly River into Ok Tedi’s main river port at Kiunga unreliable and also affected operations at the Ok Menga power station, the mine’s main source of power.

El Nino disrupted production across a swathe of commodity producers from late last year, parching countries across the north west of the Pacific rim such as Papua New Guinea and Philippines and bringing heavy rains to others like Chile and Peru.

Indonesian neighbour Freeport-McMoRan also blamed El Nino as it cut its 2015 forecast for copper concentrate sales from Indonesia in September as water shortages affected its milling operations.

Leave a comment

Filed under Financial returns, Papua New Guinea

Harmony back in black, eyes Golpu advancement

Harmony Gold and partner Newcrest Mining look for further profits out of PNG

Natasha Odendaal | Mining Weekly | 05.02.2016

Shares in dual-listed Harmony Gold surged some 15% on the Johannesburg bourse on Thursday after the gold mining group turned the corner in the second quarter of the current financial year, posting positive earnings after a prolonged period in the red.

Harmony achieved headline earnings of R74-million for the three months to December 31, a jump of more than 100% on the headline loss of R523-million reported in the quarter to September.

Headline earnings a share reached 17c, compared with the headline loss a share of 120c in the September quarter.

“We ticked all the boxes [this quarter . . . and] revealed a solid set of results for the second quarter of this financial year,” new CEO Peter Steenkamp said in Sandton on Thursday, presenting his first set of results after five weeks at the helm.

Harmony’s production profit increased 84% to R1.29-billion quarter-on-quarter, as the average gold price increased 7% in rand terms to R507 490/kg, or $1 109/oz.

Revenue for the quarter under review increased 10% to R4.57-billion, attached to a 3% increase in gold sold to 289 323 oz during the second quarter.

Gold production increased 2% to 287 074 oz and underground grade was 7% higher, with the majority of Harmony’s operations producing higher kilograms and generating net free operational cash flow.

Despite a traditionally weak March quarter, owing to late start-ups post the December quarter and the upcoming Easter holidays, Harmony’s guidance for the full year of 1.1-million ounces would be maintained.

“Higher production means that Harmony’s cash flow is strengthened, our margins are growing, we are able to repay our debt and [we are able] to fund Golpu. The higher rand per kilogram gold price is simply an added bonus,” said Steenkamp.

During the period under review, all-in sustaining costs for all operations decreased 7% to R434 834/kg in the December quarter, compared with R466 061/kg in the September 2015 quarter. This translated into a 15% decrease to $950/oz.

Further, cash operating costs for the quarter decreased 6% to R360 153/kg and 15% to $787/oz.

The group had also repaid R1.12-billion of its debt and reported net debt of R2.52-billion as at end-December.

EXPLORATION

Now all eyes were on Papua New Guinea (PNG) as exploration activities rated high on Harmony’s “creating future value” agenda.

Harmony and its joint venture partner Newcrest Mining completed the feasibility study for Stage 1 and the prefeasibility study for Stage 2 for the Golpu project in December, with the outcomes expected to be released mid-February.

Harmony said discussions continued with PNG’s government on the appropriate terms to progress the premining development agreement, the completion of which would add more certainty to the development of the mine.

The greenfield copper-gold Golpu project was expected to expose Harmony to a one-billion-tonne resource, comprising 9.3-million tonnes of copper and 20.2-million ounces of gold, providing the group with a heavier exposure to copper than its mature South African gold assets.

Stage 1 would see the development of two block caves, with first production in 2020, ramping up to six-million tonnes a year in 2024.

Stage 2 would entail the development of an additional block cave.

Harmony noted that it had sufficient funding for the first three years of development; thereafter, the directors would seek out the best option for further funding.

Meanwhile, drilling activities had been accelerated at Harmony’s other exploration site, the Kili Teke copper-gold deposit, also in PNG, which was thought to be another Golpu.

The Kili Teke resource was the first new porphyry copper-gold deposit defined in PNG since the Golpu discovery in the early 1990s.

Following the declaration of the greenfield project’s maiden resource of four-million gold-equivalent ounces last year, current drilling efforts would be amplified by the addition of a second drill rig during the third quarter.

The drilling programme of the copper-gold deposit on Harmony’s 100%-owned exploration licence EL2310 showed an initial inferred mineral resource of 128-million tonnes at 0.4% copper, 0.3 g/t gold and 170 parts per million molybdenum, containing 506 000 t of copper, 1.2-million ounces of gold and 22 000 t of molybdenum.

Leave a comment

Filed under Exploration, Financial returns, Mine construction, Papua New Guinea

Ongoing military deployment a sad indictment of Barrick’s Porgera mine

State of emergency porgera

There is no immediate end in sight for the continuing military deployment and State of Emergency around the Porgera mine owned by Barrick Gold and Zijin Mining. Barrick and the government like to describe large-scale mining as ‘development’ but with both the PNG Defence Force and a police mobile squad required to keep the fragile peace it is clear that ‘development’ is not for the local people. Mining puts plenty of profits into the hands of foreign mining companies and their investors and into the pockets of corrupt politicians and bureaucrats in Port Moresby but life for local people is a misery…

Porgera State-Of-Emergency Operations Successful
PNG Today | 3.02.2016
The National Government State-of-Emergency (SOE) call-out seeks to put in place an ‘exit plan’ by December 2016, according to outgoing contingent commander Superintendent Joseph Poma.
He said this move will be to ensure that Porgera Police, Enga Provincial Police command, and the Enga Provincial Government execute their own plans on policing duties in Porgera district.
“This year 2016 is the time we have to put our exit plan in place the PPC, the PSC, and provincial government to take over the security operations.
“We’ve got strategic plan in place so to ensure those plans are in place come December 2016.
“General SOE operation has been very successful. Our presence here has seen a great reduction in illegal mining in the pit”, he said as he also thanked Paiam Police Station commander Inspector Peter Yambun for the support as well.
And at least 64 people were arrested for minor offences during the festive period in the district, and credit goes to the Porgera community for a peaceful festive period.
The minor offences included drunk and disorderly behavior as well as causing willful damages, among others.
Mr.Poma said these at the conclusion of the Christmas and New Year security operations conducted by members of the SOE call-out contingent and members of Paiam police.
He said unlike previous years, the festive season in Porgera was quiet, thanks to the general Porgera community for ensuring there were no major law and order issues.
“My encouragement is to the people of Porgera to continue to maintain that. Where there is peace, there is development. No peace, no development. So they must see that as an example and
I want them to continue to support that.“…also my thank you to the SOE operations unit.
They’ve been very supportive”, a very satisfied Mr Poma said.Mr Poma also attributed the peaceful festive period to the pre-Christmas and New Year operations which included awareness, conducted by the call-out members of the security forces made up of the PNG Defense Force (PNGDF) Second Royal Pacific Island Regiment (2RPIR), and Police Mobile Squad 14 (MS14) from Eastern Highlands.
The call-out members were Wewak-based 2RPIR Charlie Company under the command of L/P Mark Akasitai with the assistance of Military Liaison Officer (MLO) Captain Valentine Mok, and members of MS14 led by acting commander Senior Constable Ikani Bile.
Raids were also conducted during the operation which resulted in the confiscation of homebrew and other illicit items.
The items included five (5) 20L containers with the brew, and 394 of the 500mL pet bottles containing the homebrew with a street value of about K11,000.
Mr.Poma also said the security forces confiscated 151 cartons and 21 bottles of alcohol from a local eatery which had the license to operate as a restaurant, but had allegedly sold alcohol to members of the public.
He said his troops came upon some people who were under the influence of alcohol, who led police to the restaurant.

Leave a comment

Filed under Corruption, Financial returns, Human rights, Papua New Guinea

Axiom Mining nears Q1 nickel shipments and $10M funding deal

Proactive Investors | 02.02.2016

Axiom Mining is expecting first shipments from Isabel in Q1 2016

Axiom Mining is expecting first shipments from Isabel in Q1 2016

Axiom Mining is edging closer to a milestone first shipment of nickel ore form the Isabel project in the Solomon Islands during Q1 2016 as a A$10 million financing facility and long-term offtake deal unfold.
Planning, design and development work at the project with an eye on this near-term export scenario has paralleled a due diligence process with global independent trading house Gunvor Singapore for financing and offtake continues.
This follows from an initial offtake agreement for 500,000 tonnes of nickel ore and A$5 million ore pre-payment facility executed with Gunvor in December 2015.
Other recent activities at Isabel have included several ecological surveys, environmental fieldwork and the completion of both a development strategy for a life-of-mine pit and a field component of social impact assessment.
Negotiations with key suppliers of marine services, vessels and heavy machinery are completed and they are on standby to move into production.
Ongoing infrastructure development includes camp upgrade, laboratory, roads, barge ramp and stockpile areas.
Preliminary work on San Jorge Island includes survey and environmental baseline monitoring.
Axiom, its landowner partners and the Solomon Islands government secured a definitive victory against Japanese major Sumitomo in the Solomon Islands High Court in 2014.
The subsequent appeal by Sumitomo was completed in June 2015 and a decision is expected to be delivered shortly.

Leave a comment

Filed under Mine construction, Solomon Islands

Nautilus Minerals gets seafloor mining tools for Solwara 1 project in Papua New Guinea

nautilus robots wet testing

The SPTs will undergo wet testing at Duqm Port in Oman.

Mining Technology | 2 February 2016

Nautilus Minerals has received three seafloor production tools (SPTs) from Soil Machine Dynamics’s (SMD) facility in Newcastle-upon-Tyne, UK, for its underwater Solwara 1 mining project in the territorial waters of Papua New Guinea (PNG).

The Solwara 1 joint venture consists of Nautilus with 85% and Eda Kopa (Solwara) with 15%.

The SPTs are set to undergo wet testing at Duqm Port in Oman and will be stored at United Engineering Services’ (UES) facilities in Duqm for preservation and maintenance.

Later on, they will be integrated on UES’s production support vessel (PSV), which is expected to occur in 2017.

Nautilus plans to use the SPTs to cut and extract copper and gold from the seafloor at the Solwara 1 JV’s project site in the Bismarck Sea, Papua New Guinea.

Seafloor production operations are planned to begin in the first quarter of 2018.

Nautilus Minerals CEO Mike Johnston said: “The Solwara 1 JV partners are delighted to have achieved this major milestone and we are looking forward to undertaking the extensive wet testing programme that we have planned.

“We look forward to continuing our relationship with SMD during the wet testing programme and into the production phase of the Solwara 1 project.”

SMD CEO Andrew Hodgson said: “SMD, together with our parent company China Railway Rolling Stock, are leading the way in the construction of remote mining and deepsea excavation technology.”

The Solwara 1 project development includes the recovery of high-grade seabed sulphide deposits from the floor of the Bismarck Sea, a major resource of base metal sulphides, gold and silver.

Leave a comment

Filed under Mine construction, Papua New Guinea