Monthly Archives: March 2012

PNG troops to be deployed against their own people

Papua New Guinea’s Prime Minister says Defence Force soldiers will be deployed in parts of the Hela region and Porgera to assist police curb rising lawlessness in those areas.

Illegal and unlawful behaviour of individuals and groups in Tari and nearby areas have disrupted early works associated with the PNG liquified natural gas project.

On Thursday, hundreds of illegal miners converged on the Porgera mine, attacking workers and damaging equipment there, halting operations at the open pit mine.

In a statement, Prime Minister, Peter O’Neill, says it is totally unacceptable that law and order has broken down in those areas.

Mr O’Neill says such behaviour has placed the lives of innocent people at risk, and disrupting work at the LNG project and operations at a mine that is a key contributor to the national economy.

He says the government cannot sit back and allow hooligans in the community to threaten and disrupt normalcy, and place vital economic projects at risk.

Peter O’Neill says no criminal behaviour that threatens the well being of the country will be tolerated.


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Filipino rebels threaten new attacks on mine firms

Philippine communist guerrillas warned three mining companies Wednesday that they may be attacked again if they continue to use methods the rebels say harm the environment.

New People’s Army regional spokesman Jorge Madlos said the nickel mining companies in remote Claver town in southern Surigao del Norte province have refused to discuss the guerrillas’ concerns about the environment and the treatment of mine workers. Mining officials have denied the rebel allegations.

Military spokesman Col. Arnulfo Marcelo Burgos said attacks by more than 200 guerrillas on the sprawling mining compounds last October were part of extortion attempts. Government forces have bolstered security at the mines, he said.

The Maoist guerrillas disarmed guards, briefly held company staff, and burned company offices and heavy equipment during the Oct. 3 attacks, one of the largest rebel assaults in recent years. One of the companies was forced to temporarily shut down its operations.

Madlos acknowledged the rebels wanted what he called “revolutionary taxes” from the mining companies but said the attacks were primarily sparked by their concern over mining methods that have allegedly caused sea and land pollution in Claver, about 430 miles (700 kilometers) southeast of Manila.

The New People’s Army, which is listed by Washington as a terrorist group, has staged smaller attacks on mining companies and banana plantations in the south in the past, accusing them of exploiting the country’s resources and workers. The rebels are estimated to number slightly more than 4,000.

Peace talks with the guerrillas stalled last year after the government refused a rebel demand for the release of several of their captured comrades.

The Communist Party of the Philippines urged its armed wing, which celebrates its 43rd anniversary on Thursday, to intensify attacks on government forces, including small assaults that employ homemade bombs, land mines and booby-traps, “to demoralize and disintegrate the enemy.”

The Marxist insurgency, one of Asia’s longest-running, has been weakened considerably by battle setbacks, surrenders and factionalism but remains the country’s leading security threat, the military says.


Filed under Corruption, Environmental impact, Human rights

Porgera mine raided

ONE of the country’s biggest gold mines was yesterday raided by an unruly mob who went on a rampage injuring employees and damaging equipment, reports The National.

Porgera mine general manager Greg Walker and Enga province Governor Pater Ipatas have sent an urgent message to the government, police and the defence force in Port Moresby to provide security and address the deteriorating law and order problem in the area.

Mine workers were injured and three were taken hostage as scores of illegal miners went on a rampage through the open pit early yesterday morning. The three workers were later freed, with one sustaining serious injuries. Substantial damage was done to mine equipment although no estimated cost has been released.

The Porgera Joint Venture (PJV) mining operations in the open pit had been halted until the safety of workers could be guaranteed.

Walker said: “We have reported this serious incident to the government and to police. We are calling on them to act swiftly to restore law and order in Porgera. There is no excuse for the illegal and violent behaviour of these trespassers – they place our employees and themselves in grave danger when they act outside of the law in their attempts to steal gold from the mine,” Walter said.

“The behaviour of these illegal miners, virtually all of whom have migrated in from outside of Porgera, has also contributed to the steep decline of law and order in the Porgera valley, affecting the community at large.

“This simply has to be stopped and I call on the government to undertake its responsibility to protect our legal right to peacefully conduct our business.”

Ipatas condemned the actions of the illegal miners, which the mine management said numbered over a thousand, saying many of them were from outside Porgera.

He has asked the police and soldiers in Port Moresby to come to Enga and help restore law and order.

Ipatas said illegal miners in the area continued to be stubborn despite the number of them killed or maimed by mining explosions. The most recent case was on March 3 in which five men who had illegally entered the mine were killed during a routine blast underground.

“They have not learned from the recent incident in which five people died, that they should not be in there,” he said.

“They should know by know that the PJV has been given the lease to do the mining and exploration. They have the legal right.

“The actions of these illegal miners have an impact on Porgera, Enga and PNG. We can’t allow criminal to take control of the area.

“I call on police to strengthen their presence in the Porgera Valley so that the interests of the country can be protected.

“I wouldn’t mind a call-out of the PNGDF soldiers to help police in the area. These are not locals doing this illegal mining. They are people from other areas.

“I’m also mindful that there are people living on the special mining lease area. It’s time that they are resettled so that the area is free from local people and illegal miners.”

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Simberi locals concerned over alleged dumping of toxic waste

The New Ireland provincial government will not tolerate the continuous negligence by Allied Gold Plc and the national government in dealing with environmental and other problems at the Simberi Gold mine, a spokesman says, reports The National.

Mining chairman, Marius Soait said the landowners of Simberi and Tabar islands and the people of New Ireland were extremely upset over the reported dumping of toxic waste in a pond on Jan 24 when the tailing system pump was out.

“The alleged spill is the second in the waters of Simberi Island in one year, following the cyanide spill in 2011,” he said.

“This shows the reckless disregard of Allied Gold when it comes to safeguarding the environment and the health of the people of Simberi.”

He said the provincial government had made it clear it wanted Allied Gold removed because it had failed to adhere to its responsibilities under the mining agreement and the MOA, it had brought in mercenaries from Fiji and had “acted irresponsibly and in violation of national mining laws and regulations”.

“The LLG, landowners and provincial government must work together with the universal aim of terminating Allied’s operations on Simberi.”

He said the provincial government was disappointed at the failure of the national government to act decisively given the poor performance of Allied Gold.

“The state should be showing the way in protecting the people of Simberi, New Ireland and PNG, instead they seem to be turning a blind eye to repeated violations of laws and regulations.

“The people have not benefitted from the development, although the company has made millions of kina every year.”

Governor Sir Julius Chan has initiated a full revision of the Mining Act 1992, a motion which has been introduced to parliament since 2009 and is still pending.

The current act gives outright ownership of resources below six feet to the state, but the motion recommends the act be amended to return ownership of those resources to landowners who originally owned them.

The provincial government is pushing for a substantial increase in revenues from the mine for the landowners, the LLG and the province as well as sharing benefits with non-mining provinces.

“It is time for the minister responsible to protect and take care of the people,” he said.

Attempts to get comments from Allied Gold have been unsuccessful.


Filed under Environmental impact, Financial returns, Papua New Guinea

Probe needed into flaws in mine payouts

A new NRI report based on a case study on the Porgera Gold Mine has highlighted the need for a probe into the current payment system.

The report by Peter Johnson recommends the need for EITI (Extractive Industries Transparency Initiative) to look at the flaws in the current payment system and pave way for transparency.

Mr Johnson also believes that there is a need for the education of landowners and women especially in finacial literacy so they may be able to positively care for their families.

The report looks at Relations between the Memorandum of Agreement, financial benefit from the mine, institutional structures and development outcomes which could answer the question of why Papua New Guinea is resource rich yet its citizens are poor.

The report is titled ‘Lode Shedding: A Case Study of the Economic Benefits to the Landowners, Provincial Government and the State from the Pogera Gold Mine.’

The report also suggests a model on how to approach landowners and development issues in future resource ventures such as the LNG Project.

It also looks at the original Pogera mine agreements and over a period of twenty years of commercial activities; how well these agreements were implemented.

NRI Director, Thomas Webster also highlighted the need for a probe, illustrating some of the issues in Pogera and other mining townships. He brought to light the mentality of the people and their carelessness towards handling huge amounts of money without investing them for the future despite receiving regular handouts from mining companies.

The report emphasises that PNG has the expertise and resources to develop strong policies to ensure transparency and accountability.

Dr Ila Temu, President of the Chamber of Mines and Petroleum thanked NRI for pointing out these issues and then going on to conduct a case study that will be able to improve them.

Temu ended with a challenge saying, ‘now that we know what is going wrong, what are we going to do about it?’

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Mining does not bring real development for PNG people

By Patrick Talu

Audited payments made by Porgera Gold Mine to the Government and various stakeholders can be tracked, but not after they had reached the Government.

There remains a critical lack of transparency at both the National and sub-national government levels where the impacted communities who are supposed to be the ultimate beneficiaries of PNG’s mining and mineral wealth are let out.

Peter Johnson, former Economics Studies Program Team Leader and Senior Research Fellow with National Research Institute said: “Observing the details of how much of the revenues from the mining project that are spent are difficult if not impossible to access.”

He was speaking at the launch of a case study yesterday at NRI titled, Lode Shedding: A case study of the Economics Benefits to the Landowners, the Provincial Government, and the State from the Porgera Gold.

Mr Johnson said it was easy to track funds coming from the mine and going into the National and the provincial Government but how and where it ended up from the provincial government to the local level government and the development authorities in this case, the Enga Provincial Government (EPG), Porgera Development Authority) PDA) and Porgera Local Level Government (LLG) respectively were untraceable.

The report has indicated that to date over a billion kina in cash and benefits have gone out of Porgera mine yet not being translated to real developments.

He said the amount of funds held in trust accounts was more difficult to estimate as well as investment made by Kupiane Investments. This, he said, was even more difficult to trace except for an initial endowment of K9 million in 1997 while the study could not find information on the current state of the benefits or how those payment were distributed.

The reports indicated that from the start of the mine in 1990 till 2009, the National Government received over K3.4 billion in income tax, company tax, customs, fuel levy, business contracts, education and other measures.


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

Ramu mine fight “under control”

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Cameron’s historic dive reinforces importance of marine environment in PNG

A Papua New Guinea social media practitioner says James Cameron’s historic diving mission has reinforced a message about the need to research and respect the undersea environment, reports Radio NZ.

The acclaimed film director used a specially designed submarine to dive nearly 11 kilometres to the botttom of the Mariana Trench.

He spent just over three hours under water after reaching a depth of 10,898 metres exploring and filming the ocean floor at the earth’s deepest known point.

Emmanuel Narakobi of Masalai Communications conducted a rare interview with James Cameron before his dive while he prepared for the mission in East New Britain.

He says a lot of local people are excited about Cameron’s combined interest in the environment and sense of adventure, in both his work in film and scientific study.

Mr Narakobi says the film director imparted some important messages:

“We don’t understand enough about the undersea world and for us it’s an issue in terms of deep sea mining – we have two mining projects specifically that are occurring which are affecting our undersea life – and we don’t understand enough to be playing around with these things. And the other message was that in terms of exploration, the human pursuit of going to see the unknown, to find out about the world.”

Emmanuel Narakobi says his interview with James Cameron will soon be available online on the Masalai blog,

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Four airlifted from Ramu mine after fight between Chinese and local workers

By Jayne Safihao

A fight over wages between employees at the Kurumbukari mine site resulted in four being airlifted by helicopter to hospital because of their injuries.

It followed a week of talks between employee representatives and company executives on employment conditions.

In their petition to the company, local employees want equal or reasonable hourly rates comparable to their Chinese counterparts.

Locals are paid K2.33 an hour, with those serving more than five years getting K3.50 a hour. The employees said they wanted K5 per hour.

The MCC management confirmed yesterday they were still negotiating on the pay rate when the attacks started.

Ramu NiCo’s Mathew Yakai said a rumour that the company was not willing to consider workers demands had provoked a landowner employed by the company who then hit a Chinese co-worker.

“That provoked the other Chinese to come to the aid of their countryman, resulting in the fight,” he said.

Provincial police commander Supt Anthony Wagambie Jr  said properties including vehicles and buildings were damaged as a result of the fight.

Three injured Chinese and a local worker were flown by helicopter to the Modilon General Hospital in Madang.

Meanwhile, the Department of Labour and Industrial Relations has condemned treatment of their officer by the employees.

The Labour office said in a statement:

“The so-called ‘Industrial Action’ taken by those employees was illegal, by the fact that there is no registered industrial organisation representing this group of employees.

“Despite the technical circumstances, a provincial labour officer in Madang, agreed to accept the invitation of the company to attempt a resolution to the 12th March 2012 industrial dispute.

“For his efforts however, he was verbally and physically abused and was held captive for a few hours by the workers concerned, in demand for a hearing from other various government agencies.”

The department demands a public apology from these workers.


Filed under Corruption, Human rights, Papua New Guinea

Nautilus reports end of year results


Nautilus Minerals says it ended 2011 in a solid financial position with US$149.4 million in cash and cash equivalents, after a milestone year which saw the Company granted the first deep sea “hard rock” Mining Lease for its Solwara 1 project in the Bismarck Sea, Papua New Guinea (“PNG”).

The Company yesterday released its 2011 full year financial results and Annual Information Form.

Nautilus says it delivered several key achievements during the year, with the highlights being:

  • Mining Lease ML154 (the area containing Solwara 1) granted by the PNG government for subsea production in the Bismarck Sea
  •  Agreement to form a mining joint venture with the State of PNG for the Solwara 1 project
  •   Agreement to form a vessel joint venture with Harren & Partner to own and operate a production support vessel
  •   Nautilus awarded exploration tenements in the Eastern Pacific and Fiji
  •    C$98.1 million raised in private placement of common shares
  •    Increased mineral resources at Solwara 1 and a declared maiden inferred resource at nearby Solwara 12
  •    Continued progress and development advances for the Solwara 1 project

Since the year end, the Company has continued to work with the PNG Government and Petromin PNG Holdings (“Petromin”), a company wholly owned by the State of PNG, to finalise contracts and financing arrangements for Petromin’s 30% holding in the Solwara 1 project.

At year’s end the company reported a loss of US$34 million, with total expenses of US$35.0 million, including US$14.2 million in exploration costs, and general & administrative expenses of US$17.2 million. Total assets increased to US$282.6 million with the capitalization of expenditure for mineral properties following the grant of the Mining Lease and the increase in assets under construction. The cash and cash equivalents balance was also positively impacted by the receipt of funds from the private placement in Q4 2011.

“Nautilus achieved several milestones in 2011 that has positioned the Company well to reach its production target in Q4 2013,” said Nautilus CEO Stephen Rogers.”2012 is going to be another productive year as equipment takes shape on the project, the treatment and marketing route is finalised and we continue our exploration work in the Bismarck Sea and other areas to build the production pipeline.”

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