Solomon Islands govt reinstates Gold Ridge mining lease


Radio New Zealand | 24 January 2017

The mining lease for a closed gold mine in Solomon Islands is being reinstated by the government after having been cancelled by the mines minister last year.

A government statement said the relevant framework for the Gold Ridge mine to reopen was being finalised.

But the chairperson of the customary land-owning company, Gold Ridge Community Investments Ltd, which is the minority shareholder in the mine, said this basically referred to cancelled mining lease.

Walton Naezon said the majority shareholder, the Chinese-owned AXF Group, wanted to begin reconstruction of the mine in early February provided the lease has been reinstated.

“There is two things, one is to start the mine, doing the roads, rehabilitating the mill, doing constructions and doing explorations and assessing the tailings dam. Those are mining activities that can be taking place quickly from February upward. The actual production was look at end of 2018.”

He said it was projected that the cost of bringing the mine back into production would be between $US80 and 90 million.

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Illegal firearms at Exxon-Mobil LNG a concern

Police and soldiers in Papua New Guinea wait to board a flight to the Hela Province highlands. (ABC News: Eric Tlozek)

Police and soldiers wait to board a flight to the Hela Province highlands. (ABC News: Eric Tlozek)

Ramcy Wama | Post Courier | January 24, 2017

THE building up of illegal firearms at the Exxon-Mobil LNG project sites in Hela Province is alarming and leaders have raised concerns that it might affect the LNG project.

Hela Governor, Francis Potape when welcoming the police and PNGDF soldiers said there are alot of illegal firearms that are building up at the projects sites and security forces, leaders and the people have to work together to curb the building up of illegal weapons at the project sites and the whole of Hela Province.

He said the amount of illegal firearms at the projects sites is alarming and can affect the LNG project.

“The amount of firearms at the LNG project sites is alarming and has the potential to affect the PNG LNG Project in Hela,” Mr Potape said.

He said the ‘call-out’ in the province is very important and urged leaders not to politicise the whole operations but let the security forces carry out what they are assigned to do.

“We don’t want the call out to be involved with the politics of Hela leaders and politicians in the province. The outcome of the security operation must be police and soldiers driven and not politics,” Mr Potape said.

He said the people of Hela want the operation to be successful and the end result must be positive.

“We don’t want a third call out in the province. If this operation fails, I don’t think the third operation would work out for the province.” Mr Potape said.

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LNG security callout: a holiday for Hela’s warlords?

Hela Province Tribesmen Photo: RNZI / Johnny Blades

Hela Province Tribesmen Photo: RNZI / Johnny Blades

Johnny Blades | Radio New Zealand | 23 January 2017

Late last month, 300 police and military personnel were deployed to Hela, which is home to the lucrative LNG gas project, after months of tribal fighting and a build-up of high-powered firearms.

There are warnings that a major security forces callout to Papua New Guinea’s Hela province will not provide a long-term solution to ongoing tribal fighting.

Dozens of people are understood to have died last year in fighting and lawlessness which has been particularly bad around Hela’s capital Tari.

Since the callout, police have been on a province-wide drive to collect illegal firearms in Hela, with an amnesty is in place for tribes to surrender their guns by the end of February.

The proliferation of high-powered guns in the region is not a new concern, but remains a concern for the operations of the ExxonMobil-led LNG project.

Deputy governor of Hela Thomas Potabe said that since the callout, fighting had largely cooled off.

“Now the province is quiet and we have almost 300 police and soldiers on the ground, so I don’t think we will get big fighting like before we did,” he said.

However there’s scepticism from NGO worker James Komengi, who has worked with facilitating mediation between warring tribes since 2008.

He said merely taking some guns out of the equation would not help in the long term because tribal fighting was entrenched in Hela as a result of the lack of public services and development.

The Highlands’ warring tribes have a source of illicit firearms trade which they can tap, along the border with Indonesia – both via Indonesian military and West Papuan tribes.

In Mr Komengi’s view, warlords could easily seek more weapons if they felt exposed.

“We are giving a holiday to the warlords,” Mr Komengi said of the current callout.

“It looks like it’s only a callout for the arms, and they don’t have any programmes that will be left behind to help us transform the communities. And that’s something I think the politicians will seriously have to get into to transform the province. Otherwise it’s more like a temporary break for the warlords.”


For others, addressing the lawlessness and fighting is a question of leadership.

A Hela community leader, George Tagobe, said local police had the resources to deal with fighting before a callout was needed, but that direction was lacking.

“Our leaders, when they are in there, when they show their presence in the area where the fighting is, people respect. When there’s no leaders, people run around like animals,” was Mr Tagobe’s summary.

“Now the local police, they can be able to perform, but they’re waiting for orders to come. They can’t just go in and conduct raids and go into the fighting zone without any orders from the hierarchy,” he said.

Police operations commander, Assistant Commissioner David Manning, said Hela people had lost confidence in the region’s governance, and that needed to be restored in order to end lawlessness.

Tribal divisions are entrenched in Hela Province, Papua New Guinea. Photo: RNZI / Johnny Blades

Tribal divisions are entrenched in Hela Province, Papua New Guinea. Photo: RNZI / Johnny Blades

“Over the years the thinking of the people of Hela has been that the national government has abandoned them, has really not given much focus on addressing some of the socio-economic challenges that the people face up here,” he said.

“As such, there was a building resentment towards the government [at] the national, provincial and district level.”

Part of the resentment that exists in Hela stems from the perception among of communities in the LNG Project area that promised benefits from this massive commercial venture have not materialised.

While their grievances have tended to be with government rather than developer, landowners mounted various protests last year, demanding outstanding project payments, and greater share of equity in the project.

Both police and local authorities deny that the tribal fighting is directly related to the LNG project, yet the project’s footprint, and expectations surrounding it, remain important and potentially epxlosive in Hela.

Mr Manning said that ending the fighting was a huge task that wouldn’t be completed quickly.

“The success of this operation hangs all over the shoulders of the people of Hela and how we – the operations – can engage in effective and productive partnerships with them in resolving the future of the province.”

Hela provincial government officials said the security forces callout had sparked constructive peace talks between warring tribes, and they were hopeful of a lasting settlement.

As PNG’s five-yearly general elections are due in mid-2017, it’s likely the government will maintain a boosted security forces presence in Hela.

With unrest around polling having hampered previous elections in parts of the Highlands, prime minister Peter O’Neill has indicated that security around the upcoming elections will be a priority.

However, people in Hela are concerned that settlement of tribal fighting may collapse after the polls.

A school burnt out as a result of tribal conflict in Papua New Guinea's Hela province. Photo: RNZ / Johnny Blades

A school burnt out as a result of tribal conflict in Papua New Guinea’s Hela province. Photo: RNZ / Johnny Blades

Dialogue and understanding

James Komengi has been involved with the Ambassadors for Peace programme which was instrumental in the signing of a peace agreement between 32 warring communities in Hela region in 2008.

He said that since then none of the communities had resorted to violence.

Mr Komengi said the programmes which civil society facilitated have brought warring tribes together at workshops to develop the skills to dialogue and understand each other as well as the causes of conflict.

These workshops and dialogues were generally mediated by trained local facilitators like him.

He said that peace agreements between previously warring communities or tribes were based on their own agreements, publicly declared, and monitored by facilitators.

These were the types of programmes he said were needed to cope with Hela’s current wave of conflicts.

Drought a factor

Adding to the sense of despair and frustration among people in Hela, and other parts of the Highlands, is the hobbled government response to the recent drought.

Farmers and crop gardeners in many parts are still recovering from devastation caused by the El Nino-induced drought from 2015 to 2016.

A dry creek bed during the drought. Photo: Supplied

A dry creek bed during the drought. Photo: Supplied

Mr Komengi said that in response to the drought there was little effective help from provincial or central government.

According to him, government relief supplies or funds were often misused or misdirected.

Now, the National Agriculture Research Institute is partnering with civil society in the Highlands to help build resilience to future droughts.

Mr Komengi said that NARI has chosen the United Church to work with in Hela because it led the drought impact assessment and response programmes.

The notion of not waiting around for government to help, but instead of getting on with a community-driven response, has gained currency in PNG’s Highlands.

But taking matters into one’s own hands, particularly where justice is concerned, is also at the heart of the tribal fighting problem.

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St Barbara considers dividend payment

Abandoned Gold Ridge mine processing plant. (Stefan Armbruster SBS)

St Barbara shareholders set to cash in after abandoning Solomon Islands mine – funny how The Australian manages to leave out the whole Gold Ridge saga from its story…

The Australian newspaper airbrushes history and completely ignores the fact St Barbara was condemned as ‘immoral’ by the Solomon Islands Environment Ministry for selling its abandoned ‘disaster’ mine to traditional landowners for A$100.

Read More: Australian real estate investor circles Solomons ‘disaster’ gold mine

The West Australian via The National aka The Loggers Times | January 20, 2017

ST BARBARA is weighing the potential for dividend payments as the cashed-up gold miner closes in on an end to its debt nightmares, according to the mine.
St Barbara’s assets include the Leonora operations in Western Australia and the Simberi operation in New Ireland.
Managing director Bob Vassie admitted in an analyst conference call yesterday that the St Barbara’s board was facing pressure from shareholders to outline a dividend policy as the company built its cash war-chest and eyed debt-free status.
Its position is a far cry from 2014, when St Barbara owed about AU$320 million and was on corporate death row as the gold price weakened.
It produced 99,000 ounces of gold from its Leonora and PNG operations in the December quarter, spitting out AU$76 million in free cash flow and repaying AU$121 million of debt.
It will pay another AU$20 million before the month’s end and says lenders will be fully repaid in March.
St Barbara had AU$87 million cash at the end of December and 14,500oz of unsold gold worth about AU$23 million.
It plans to spend AU$85m to $95m on a ventilation and waste infill project that will take the miner to the bottom of its Gwalia mine’s known reserve – 2000m below the surface.
Vassie said St Barbara was looking at growth options, including acquisitions and AU$22 million of exploration.

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Western Province people given 33% mining shares


The National Government has fulfilled its commitment gifting the people of Western Province shares in Ok Tedi Mine

Sounds great, but will the people actually see any improvement in their lives?

Charles Yapumi | LOOP PNG | January 23, 2017

The historic benefit sharing agreement (BSA) signing happened in Alotau on the weekend between the six mine area villages and the 152 villages from the Community Mine Continuation Agreement (CMCA) regions will share the 33 per cent direct equity interest in OTML. 

The National Executive Council’s (NEC) decision relating to the granting of the free equity was made in 2014.

The benefit sharing Memorandum of Agreement (MoA) took over two years of negotiation amongst landowners, the Fly River Provincial Government and the State.

The breakup of the shares will see CMCA group owning 12 per cent, the Mine Area Villages 9 per cent while the Fly River Provincial Government (FRPG) will own 12 per cent.

 “Now you’ve got one third direct participation. It is for the first time in the history of this country and it’s a big decision the Government has made for landowners to have direct participation in OTML,” Chief Secretary to the Government, Isaac Lupari said.

According to the MoA signed, 40 per cent of the benefits from the respective shares will be paid in cash to landowners while the other 40 per cent will go towards investment purposes and 20 per cent will go towards infrastructure development programs and projects.

MRDC’s Managing Director Augustine Mano said it was not an easy part but to manage the interests is a huge responsibility on MRDC.

“Thank you for the confidence given to us to manage your interest. We will do our best. We will not let you down,” Mano said.

The Fly River Provincial Government is yet to sign the MoA and will do so at a later date. Once all parties have signed, the agreements will be submitted to NEC for approval for the transfer of the shares in OTML.

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Landholders will still have to wait for LNG dividend payments


No immediate dividend payment, says Sonk

Shirley Mauludu | The National aka The Loggers Times | January 19, 2017 
DIVIDENDS “will not be paid right away” to the beneficiary groups which have signed agreements to acquire Kroton equity in the PNG LNG project, an official says.
Kumul Petroleum Holdings Limited managing director Wapu Sonk made the statement on Tuesday when PDL (petroleum development licence) 4 from Gobe in Southern Highlands signed their unit application form to buy their share of the Kroton equity.
“What we are doing will maybe go through two steps. After the signing, it does not mean that we will release the dividends right away,” he said.
“We will wait for all the green field areas to go through the normal process of clan vetting, ADR (alternative dispute resolution), to properly identify and register all the landowner groups, ILGs (incorporated land groups), landowner representatives of the ILGs.
“We will allow for that to complete and then we will release dividends. That will take some time.”
Ten (10) groups had signed their share transfer documents as well as the vendor finance offered by KPHL.
“After their signing of the PDL, KPHL will work with these beneficiary groups to complete the corporate or statutory aspect of the transaction for their shareholding interest in KPHL to be registered,” Sonk said.
He assured the landowners that KPHL’s board and management were committed to ensuring that all landowners and provincial governments receive their entitlements under the Umbrella Benefits Sharing Agreement which was passed in 2009 at Kokopo, East New Britain.

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MRA says mine MoAs should be public and independently audited every year…


… so what are Philip Samar and MRA doing to make sure that happens? 

Freddy Mou | Loop PNG | 18 January 2017

The Mineral Resources Authority (MRA) is calling for an improvement on how revised mining projects Memorandum of Agreements (MoA) are administered.

MRA Managing Director Philip Samar made this call when presenting six revised MoAs to the Mining Minister Byron Chan on Monday.

The revised MoAs are for Hidden Valley, Tolukuma, Ok Tedi, Simberi and Sinivit. The only new mining project MoA is for Woodlark.

Samar said that there is definitely a need to improve on how these MOAs are administered.

“The negotiations, as difficult and challenging as they might be, is actually the easy part.

“The real challenge is, and has always been, for the various parties to these MOAs to fulfil and deliver on their various commitments.”

Samar added that the MRA is proposing that an open and transparent process be built into these respective MoAs.

He said this is to enable each MoA to be self-administered where an independent party is engaged under the respective MoAs to conduct an annual audit of how each of the parties have performed in terms of fulfilling their various commitments and to have this report made available publicly to the various stakeholders and the general public.

“A complimentary initiative given PNGs participation in the EITI protocols is for these MOAs to be made public documents.

“The MoA review process itself is a public process involving various stakeholders in numerous public forums and as such the final product itself should therefore be a document that the various stakeholders and the general public can have access to.”

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