MOST resource owners in the country must be made aware that for so long considerable wealth has been siphoned through public equities and not from the actual sale of minerals. They are misled to believe that resource developers make millions of kina through the sale of commodities such as gold, copper, silver and nickel.
Mining Minister Byron Chan highlighted this during his first ministerial visit to the landowners and company executives of multi-million kina Lihir and Simberi mines respectively.
“Most of us have little knowledge about the way resource developers actually make money. We’ve been led to believe that their benefit comes from the sale of gold, copper, silver, nickel and carbon energy.
“But since taking office I have come to learn that significant wealth is accumulated in the public equities that are bought, sold, and traded on international stock exchanges using our resources. Company stocks soar on news of the granting of exploration and mining licenses and, to date, no party in Papua New Guinea has seen any tangible benefit,” Minister Chan said.
Chan who is also the Member for Namatanai, the richest electorate in Papua New Guinea that houses world class mines in its backyard such as Lihir, Simberi and Nautilus wants to see new changes for resource owners and the nation at large.
“So today, in the dawning of the new paradigm for mining in Papua New Guinea, my office is exploring ways to insure that the expansion of shareholder value in the global equity markets for announcements made, and rights granted by my office include benefit that flows to landowners and the nation.
“Using state-of-the art quantitative market tools, we have begun a process of learning the value of our intangible asset announcements – our granting of licenses – and we will develop world-class methods to insure that when our resource developers win, our people win alongside them.”
He also would like to see more dialogue between mining companies and industry partners to fully understand clearly the motive behind his proposed amendments to the Mining Act 1992.
The minister raised this concern after learning that both foreign and local commentators in the media misunderstood the nature of his move and what it meant for resource owners in Papua New Guinea.
“In my capacity as the Minister for Mining, it is well known that I have long stood with citizens of Papua New Guinea in calling for a more equitable participation in the benefit extracted from the land and sea of this country.
“For many years, ministers before me have been advised to favour mining operators under the veiled threat that, standing up for our rights and interests would intimidate investment in development of our country’s resources. This advice has placed our interests secondary to those of the international markets.
“However, as we see the global markets transform, with economies from the U.S to Europe to Asia undergoing considerable stress, the assets of this country are highly desired and, in this time, the maturing Papua New Guinea must now stand side by side with nations of the world, expecting and receive mutual respect, dignity for our people, and appropriate sharing in the abundance of our resource wealth.
“My office is undertaking a comprehensive review of a number of initiatives that you will hear about in the coming weeks and months. Abuse of our land, sea and people will be addressed. But even more than that, abuse of our government’s actions will be addressed,” Minister Chan said.
- Recognition and protection of traditional landowner’s right to mineral ownership on or under their traditional land and seabed;
- Urgent review of the mining legal regime;
- Deep-sea mining; and
- Environmental Protection.
The minister noted the four policy directions would take time to be properly assessed with other existing policies and an appropriate case study will be done by the mining department and MRA and local and international advisors and consultations with all industry stakeholders to properly substantiate the proposed changes.
The policy would take at least six (6) months before the “policy changes” will be brought to Parliament for debate.