FIJI: Parties meet to iron out mining issues

Apisalome Coka | Fiji Broadcsating Corporation

The Namosi Provincial Council has met with the Tikina Namosi Landowners for the first time to iron out issues pertaining to the proposed mine at Waisoi.

The two groups have been at loggerheads at the meeting as landowners raised issues of concern to their land.

According to the Chair of Namosi Provincial Council – Ratu Romanu Matanitobua – the TNLC has agreed to wait for the rehabilitation program by Namosi Joint Venture.

They have described that the Prime Minister has said to them to go ahead and do the rehabilitation work before it’s handed back to him for his decision.”

Meanwhile – the Council is also waiting for NJV to come back with their environment reports before any decision is made.

We would like the work to commence for the company to determine it’s exploration works. Let them finish whatever they exploring up there plus the EIA work that the company is undertaking.

Both parties have agreed to have the Prime Minister have the final say on the mat

FIJI: Waisoi mining proposal tops agenda

Apisalome Coka | Fiji Broadcasting Corporation

The Namosi Provincial Council will today – for the first time – meet face to face with the Tikina Namosi Landowners Committee.

Council Chair Ratu Romanu Matanitobua says the two parties will discuss issues regarding the proposed mine at Waisoi.

The TNLC has been campaigning for anti-mining in the province and claim they have the support of 92 percent of the people – following a survey.

Mining company Namosi Joint Venture says they have not seen the survey report as claimed – and cannot comment on the issue.

The Namosi Provincial Council says they are supposed to be working together with the TNLC

Australian arbitrator chosen for PNG mining dispute

Radio Australia

Long spined sea urchins on a seabed

A former Australian chief justice has been appointed to resolve a dispute between the PNG Government and mining company, Nautilus Minerals.

The dispute is delaying the opening of the world’s first seafloor gold and copper mine.

The PNG Government signed an agreement with Nautilus last March to take a 30 per cent stake in the firm’s Solwara 1 site in the Bismark Sea.

Since then environment groups have waged a vociferous campaign against seafloor mining and PNG has failed to pay its share of the initial investment.

Nautilus and PNG both accuse each other of breaching the agreement.

In a statement, Nautilus says the parties have agreed to the appointment of Australia’s former chief Justice Murray Gleeson as arbitrator.

Arbitration will take place in Sydney and is expected to take several months.

Nautilus hopes to start mining gold and copper deposits off the coast of PNG next year.

FIJI: Government to meet TNLC and NJV

By Vosita Kotoiwasawasa | Fiji Broadcasting Corporation

The Prime Minister Voreqe Bainimarama says they will soon meet with representatives from the Tikina Namosi Landowners Committee and Namosi Joint Venture to discuss on steps to be undertaken in the proposed mining project at Waisoi.

TNLC spokersperson Saviriano Nariva had earlier told FBC News that more than 92 per cent of the people disagree with the project.

However, Bainimarama says all social issues concerning landowners will be handled by a taskforce.

“The mining project is currently at the exploration stage. The environmental and social issues concerning landowners earlier this year has been addressed by a taskforce. The rehabilitation action plan which I had approved has paved a way forward in addressing other issues. After the successful completion of the rehabilitation action plan, the government, NJV and landowners will meet to decide the next step.”

NJV says they look forward to engaging with stakeholders to discuss concerns on the proposed project.

Nautilus and State of PNG agree to arbitration

Elizabeth Walters | Stockhouse

Nautilus Minerals said it continues to attempt to work with the State of Papua New Guinea in an effort to resolve the monetary dispute over the 30% stake the State holds in Solwara 1.

Nautilus is the first company to explore the ocean floor for polymetallic seafloor massive sulphide deposits and is developing its first project at Solwara 1, in the territorial waters of Papua New Guinea, where it is aiming to produce copper, gold and silver.

According to the press release, Nautilus and the State have agreed on the appointment of former Chief Justice of the High Court of Australia, the Honourable Murray Gleeson AC QC, as the arbitrator.

The arbitration will be conducted in Sydney, Australia under UNCITRAL arbitration rules, and may take several months to conclude, provided that Nautilus and the State comply with the timetable set by the arbitrator and otherwise act in accordance with the rules.

On July 13, the State also issued the company with a second notice of arbitration in relation to disputes concerning certain statements made by the parties and whether such statements were made in accordance with the agreement dated March 29, 2011.

In a press release dated March 29, 2011, Nautilus announced the signing of the original agreement between the company and the State.

As stated in the original agreement, Nautilus will retain a 70% holding in an unincorporated joint venture to be established with the PNG government to hold the mining assets of the project. The government’s 30% share of the joint venture will be held in Petromin PNG Holdings Ltd, the government owned company established to hold the State’s mining and petroleum assets.

The government’s initial payment to secure its holding will be approximately US$20-25 million, which represents its share of the exploration and development costs incurred up to the date of grant of the mining lease in Jan. 2011.

According to the company, the State has yet to pay for their 30% stake in the project.

Currently, the company has stated that  unless and until the dispute is resolved, completion will be delayed or may not occur and Nautilus must continue to carry these costs.

On Tuesday, Nautilus was trading for $1.08 a share. The company has a market cap of $212 million, based on $196.4 million shares outstanding. The 52-week high and low was $3.40 and $0.92 respectively.

Gold Ridge: A saviour or nightmare?

Landowners EVICTED from mine site

Alfred Sasako | Islands Buiness

It was 6pm on a day in March 1996. And Kevin Riria Malopo, a landowner at Gold Ridge, Solomons’ only commercial gold mine outside the capital Honiara, remembers it well.

He along with another landowner, Stephen Moffat, were the last hurdle in the development of Solomon Islands’ first commercial gold mine. Up to that point, both men had refused to put their signatures to the Head Lease Agreement unless their SB$3.5 million dislocation compensation was entertained.

Everyone—government officials and Ross Mining executives—waited.

For Malopo, signing the Lease Agreement would have meant allowing the company to mine Valebeabea ridge, which in effect is his village, he said in an interview with Islands Business in Honiara.

“I want the company (then Ross Mining) to say something about our claim, which is different from relocation costs. This claim is for the loss of rights to live here, the rights to perform all the traditional ceremonies of our custom and so on,” he said.

At exactly 6pm, the company made the move. It undertook “to look into the claim”, according to Malopo.

“I turned to Stephen and said, let’s sign it. So we did,” he said.

“The company then gave me SB$500 (about AU$75) and a similar amount to Stephen but he refused,” Malopo said.

“Stephen told the company he needs SB$2,500 so that he could hold a traditional feast with the people of the village since his signature has now given away their rights to live there. So the company did,” he said.

On his lawyer’s advice, the claim has been revised upwards and stands at SB$25 million (about US$3.6 million) based on new gold deposit finds in the area.

Nightmare

Sixteen years after the signing, Malopo is a haunted man. Now, he regrets having put his name to the Head Lease Agreement.

And for good reason. In June this year, Allied Gold Ltd, the new owner of the Gold Ridge mine, applied for and received a High Court Order to evict the entire Valebuti and Valebeabea villages to make way for its  mining operations.

The villagers’ nightmare were confirmed when bulldozers moved in and began demolishing houses in the last week of May beginning at Valebuti village, as helpless villagers including women and children, looked on.

Then on June 6, it was Valebeabea—the bigger village’s turn. A blanket ban on the media and others ensured no one outside the area knew what was going on as the High Court eviction order was being enforced under the watchful eyes of the mine’s security personnel from Fiji, the Royal Solomon Islands Police Force (RSIPF) and RAMSI, possibly from the Police Participating Force (PPF).

Allied Gold sought and received the High Court Order after Malopo, his brother Charles Matia and their brother-in-law, John Tigiri, failed to appear in court to show cause as to why Valebeabea ridge should be spared.

In their claim, the trio had made it clear that unless the dislocation payment was made, no mining activities would be allowed on the Valebeabea ridge. The village would remain.

Their claim was based on the contention that the villagers would be dislocated, resulting in foregoing their rights, including traditional rights to hold customary ceremonies, feasting and so on.

Because the trio did not attend the June hearing, the High Court issued an eviction order that the ridge be surrendered to the company.

Malopo was even prevented from returning to his house at Valebeabea village while the company bulldozer razed his and son’s houses to the ground.

Malopo’s permanent house along with his son’s were among the first to be pulled down. Initially he was allowed to return to the village, but not in his two-tonne truck, which was prevented by security guards manning the gate to the area.

Eventually, he was banned from entering Valebeabea altogether—his home for the last 20 years.

“I am now a nomad in my own land. Now, there’s nothing to go back to as my home has been destroyed,” he lamented.

In many instances, home contents were strewn on to the roadside while in others women were forced to gather a few of their possessions as the bulldozers waited outside the door.

In photographs secretly taken and smuggled out, the scenes looked more like a tornado had just struck the villages with items of clothing, mattresses, and so on, lying everywhere.

A villager I spoke to revealed what took place on the first day the bulldozers moved in.

“Two houses were pulled down and buried with their contents. Their owners were away in town (Honiara) that day. On their return, they found their houses were gone,” the villager said.

The families spent the night in the open without a roof over their heads.

“It was fortunate there was no rain that night,” the villager said.

“It’s a very distressing and sorry sight,” is how one villager described the scene to me after the bulldozers went through the village.

“It’s man against machine—one minute the houses were here, the next minute they were gone. What can you do?

“Many of us were born and brought up in those two villages, and now we’ve been forced to make way for the mine. We simply have nowhere to go. The company has not provided us with alternative housing,” the villager said.

The first two weeks in June had been a nightmare for Valebuti and Valebeabea villagers, according to those I spoke to.

Since the destruction of their houses, they have been scattered all over the area and forced to live with other families in relocation centres such as Obo Obo, Bubulake, Buti and Tatauna.

Allied Gold Ltd has spent around AU$10 million in building relocation houses, which the Valebeabea villagers claimed have all been occupied by others.

“We simply can’t come in and force ourselves with families we don’t know,” one man said.

Some of the people I spoke to have refused to divulge their names for fear of reprisals.

In 1996/97 for example, Joseph Labu’s house at Valebeabea was burned down when he, as a landowner, gave an interview on Radio New Zealand International about the activities of the mine. Labu was formerly of the Weather Coast on Guadalcanal.

I asked Malopo why Valebeabea is so critical. What is so special about this ridge? Valebeabea Village sits atop a ridge that is known today as Gold Ridge, perhaps Gold Rich, is probably the appropriate description. It is the main mother lode, loaded with very high grade gold and the company wants to cash in on the current high price for the yellow metal, hence the rush to get the ridge.

It too is one of the three pits signed off to Ross Mining in 1996, which Allied Gold Limited has now inherited.

In fact, it is Valebuti and Valebeabea ridge that Allied Gold Ltd hopes to get much of the more than 200,000 ounces of super-grade gold once it starts production.

“It’s very high grade, says Mark Caruso, who anticipates obtaining 220,000 ounces of gold within the first 20 months,” according to an interview published by Islands Business, the regional magazine based in Fiji, a year ago.

At today’s gold price, that’s a cool US$355.3 million or about SB$2.6 billion return on a AU$160 million or SB$1.1 billion investment in just 20 months.

‘My company’s position is clear’

Caruso is the chairman of Allied Gold Ltd, the new owner of Gold Ridge. In the interview, he said what can only be termed as “prophetic.”

After presiding over a traditional chupu, the exchange of gifts of food including pigs and shell money as a form of reconciliation with the landowners, Caruso said in a published interview: “My company’s position is clear. We shall be decisive in dealing with these outstanding issues in establishing credibility and trust.”

One of the outstanding issues which Allied Gold has rejected outright, is the $3.5 million dislocation claim, first submitted to Ross Mining, the original operator of Gold Ridge, in 1996.

Caruso, the colourful West Australian who was described in the interview as holding much of the economic success or failure of the Solomon Islands in his hands, is certainly living up to his company’s pronouncements to be decisive if the enforcement of the High Court Order was anything to go by.

I asked one man whether the Member of Parliament for the area, Peter Shanel, Solomon Islands’ former foreign minister, was aware of what’s going on?

“No, he’s a director on the board of Allied Gold Ltd. As his voters, we’re disappointed, but we can understand his position,” the man said.

And our justice system?

“No, our justice system is the preserve of the rich and powerful, not for the small and grassroots people like us,” the man responded.

The gold rush is on. But who is benefiting?

Alfred Sasako | Islands Business

Gold discovery in Solomon Islands goes back more than 440 years.

The yellow stuff was first discovered in 1568 when Spanish explorer Alvaro de Mendana de Neyra arrived at the major island in the nation, Guadalcanal, and named the group Solomon Islands after the King of Israel who had built a great temple in Jerusalem and adorned it lavishly with gold.

Mendana’s expectation that these islands held huge amounts of gold was probably excited by being brought nuggets washed down by the Chovohio River, which emerges into the sea, just east of the present capital, Honiara.

Today, a gold rush of sorts is truly on, focusing largely on the island of Guadalcanal, where Mendana set foot 444 years ago.

Apart from the wealth, the rush also symbolises everything else—greed, promises of economic saviour for the nation and worst, dislocation of villagers who had lived in and around the Gold Ridge area, where Solomon Islands’ first commercial mine has begun exporting the yellow stuff —for more than two decades, perhaps more.

In its haste to get to the mother lode, the company acting on a High Court eviction order forcefully removed the villagers of Valebuti and Valebeabea in May and June this year, allegedly without even providing alternative accommodation for them.

Today, Islands Business has obtained details of gold export from Gold Ridge, which shows Allied Gold Ltd—the new owner of Gold Ridge—has been exporting gold since April 15, 2011.

The figures show that in the period of just 13 months (15 April 2011-15 May 2012), Allied Gold has exported more than 95,400 ounces of gold and 33,000 ounces of silver. Based on today’s going price for gold, that’s an earning of US$1.53 billion (about SB$10.7 billion) in just 13 months.Earnings from export of silver are additional.

Rumours have it that many of the shipments had gone out of the country without certification from the relevant authorities including Customs and the Mines Department.

Certification provides the basis for calculating export tax. If the rumours are true, the government could be losing a lot of money in unpaid taxes.

When the Mines Department was contacted, it said Customs was responsible for all outgoing export of gold, particularly from company production. Attempts to obtain a comment from Customs were unsuccessful.

It is not clear how much tax the government derived from the 22 shipments that had gone out of the country.

An indication comes from an interview given by Mark Caruso, the West Australian businessman who is the chairman of the Allied Gold—the new owner of Gold Ridge—a year ago.

It was reported then that earnings from Gold Ridge accounted for 30 percent of the Solomon Islands’ entire income between 1998 and 2000, when it was under Ross Mining.

The modern mine, of course, is sitting on the source of that gold in the mountains.

In the late 1990s, the mine was developed by Ross Mining. The project came under fire from Brisbane-based mining entrepreneur Denis Reinhardt and his Australian law firm Slater and Gordon. Their dispute wound up eventually in the Solomons’ Court of Appeal, which found for Ross.

But the bitter dispute with Reinhardt and Slaters and the start of the violent ethnic conflict in the country, undermined Ross’ success and the company was taken over by Delta Gold, a decade ago. After numerous changes in ownership since then, Gold Ridge Mining Ltd is now poised to start mining again, under its new owner Allied Gold Ltd, which is pouring A$160 million to its redevelopment.

First, it was vital to tackle issues that had remained unresolved since the three-year “tensions”—the acceptable contemporary gloss on the brutal war between rival gangs that hijacked the nation in the early 2000s.

Today, more gold deposits have been discovered, particularly at the Valebeabea Ridge, which bears the name Gold Ridge.

“The white man calls it Gold Ridge, we call it Valebeabea, where the village is,” one local man told Islands Business  in an interview in Honiara.

Whatever it is, Allied Gold appears to be in a rush of its own as well to get as much gold as possible before any trouble flares up again, given how angry evicted villagers are.

“It’s very high grade, says Caruso, who anticipates obtaining 220,000 ounces within the first 20 months.”

The mine is sitting on a volcanic basin and is located within a vast exploration lease area of 130sq km, which holds high prospects for further finds. Gazing over the mine site area, 500 metres high and thus slightly cool, Caruso says: “This is just beautiful.”

Beautiful it is indeed as the company rakes in thousands upon thousands of ounces of gold.

Islands Business has obtained details of the gold and silver export since April last year (See Figure 1).

 

Namosi people still against mining

Fiji Broadcasting Corporation 

More than 90 percent of people in Namosi are against the proposed mine at Waisoi.

The Tikina Namosi Landowners Committee says they conducted a survey to find out the people’s views about the proposed mine.

TNLC spokesperson – Saviriano Nariva says many are against the idea.

“We conducted a survey to find what they wanted. From there we gauged that around 92% of the people who have land in Waisoi – these people do not want mining.”

Meanwhile Namosi Provincial Council chairman – Ratu Romanu Matanitobua says there the TNLC should follow the proper channel in releasing the survey results.

“If they have the endorsement of this number why don’t they come out of their shell and talk it out with the government. They should not try to burden the company who is trying to go forth with its work.”

The mining company – Namosi Joint Venture says they have not seen the survey and therefore cannot comment on it

Enter the dragon – only to get burnt

Ian Verrender | Brisbane Times 

EXTRACT

… it could also be that China’s leaders have been left bewildered by the increasingly inept performance of their own managers when it comes to spreading their wings offshore. They have squandered billions of dollars.

A recent paper by China expert Michael Komesaroff, titled ”Screwing Up In Foreign Climes” and published in the China Economic Quarterly, details three major resource projects that were ill-conceived, poorly implemented and badly run.

Komesaroff examines China Metallurgical’s $1.5 billion Ramu nickel project in Papua New Guinea and the human rights abuses of another Chinese government-owned company in Zambia, where protesting workers were shot.

”Far from being exceptions, these examples of mismanagement are the rule,” he writes. ”It is hard to pinpoint any Chinese foreign mining projects that are trouble free and profitable.”

In contrast, the very same Chinese companies appear to be models of efficiency on their home turf.

Komesaroff cites three reasons for this anomaly. First the approval process at home is far simpler, where direct negotiation with the political elite is all that is required rather than with multiple interest groups.

The second is that problems often cannot be solved by simply hiring more cheap labour. And the third problem is that Chinese suppliers find it difficult to extend their reach to government-owned enterprises operating abroad.

Read the full article: http://www.brisbanetimes.com.au/business/enter-the-dragon–only-to-get-burnt-20120713-22131.html

Deep sea mining — a dangerous experiment

Mellie Samson Jr | SciDev.Net

Pacific governments should not approve deep-sea mining until more is known about its likely impact, says conservation biologist Mellie Samson Jr.

Deep sea mining (DSM) is the new frontier in extractive mining. For the companies involved, as well as the governments that own the mining rights, it offers substantial profits.

However DSM is still experimental in nature, with potentially vast adverse environmental effects. It also makes use of new technologies that have yet to be tested.

In January 2011, the government of Papua New Guinea (PNG) granted the world’s first deep-sea mining lease to Nautilus Minerals Inc, a Canadian mining firm, which is about to embark on a seabed mining project known as the Solwara 1 project.

This experiment, in which the PNG government will have a substantial stake, will take place 1.6 kilometres below the surface of the Bismarck Sea, off the coast of the New Ireland Province of PNG.

In recent months, however, the government has come under increasing pressure from environmental groups and others to withdraw from the project, on the basis that not enough is yet known about its potential environmental impact.

Whatever decision is taken, other island nations should reflect on the arguments being made about the dangers of moving too hastily into DSM, and consider their responsibility to protect marine biodiversity and the seas within the Pacific region.

Conservation concerns

Interest in seabed mining is growing due to an increase in global demand for metals, and the fact that land resources are increasingly being mined to the limits of their capacity.

Solwara 1 is the first of a potentially large number of offshore mining projects within the Bismarck Sea and wider Pacific region. Applications were approved last year from firms registered in both Nauru and Tonga to explore areas within the jurisdiction of the UN’s International Seabed Authority (ISA).

Solwara 1 focuses on mineral deposits laid down over thousands of years around underwater hydrothermal vents (geysers), known as seafloor massive sulphides. These deposits occur at depths of one to two kilometres, and can range in mass from several thousand to 100 million tonnes.

However fears have been expressed by critics of the project that not enough research has been carried out to enable convincing conclusions to be drawn on the likely environmental impacts of DSM, particularly as there is very little knowledge of biological diversity and ecosystems within the deposit areas.

The ecosystems surrounding hydrothermal vents combine superheated and highly mineralized vent fluids with microbes that are capable of using chemicals as a nutritional source. In recent years, such ecosystems have been found to host over 500 species previously unknown to science.

Conservation strategies need to be developed to mitigate the impact of mining activities and enhance the recovery of biodiversity in the mining zones, particularly since the project is likely to have a severe impact on the rarely explored biological ecosystems found at Solwara 1 and subsequent mining locations.

Moreover, the projected benefits of Solwara 1 to local people and the PNG economy are relatively low when compared to the size of the project and the level of risk to the environment that is involved.

The project is predicted to earn more than US$1 billion during a 30-month lifespan. But the PNG government will only collect US$41 million in taxes and royalties.

Global protests

Worldwide, there is now a growing community of concerned groups who question the sustainability of this experiment and its impact on both commercial fishing and the sustenance activities of coastal communities.

For example, ACT NOW!, a local nongovernmental advocacy group in PNG, has launched an email petition targeting Pacific island governments in an attempt to persuade them to ‘Stop Experimental Seabed Mining in the Pacific’.

They warn that the experiment risks causing an environmental catastrophe, and point out that it is not a sustainable development option for indigenous peoples of the Pacific region.

As opposition grows, developers have begun to support activities which appear to compromise the independence of agencies responsible for regulating or promoting conservation and healthy oceans.

For example, the Australian Museum in Sydney, Australia, recently held a Deep Oceans exhibition, to enable young people to learn about the importance of ocean floors, for which one of the exhibition’s sponsors was Nautilus.

Time for caution

The Government of the Northern Territory in Australia has already become the world’s first local government to impose a moratorium, until 2015, on this experimental deep-sea mining, after opposition from Aboriginal communities, game fishing groups and the Australian Marine Conservation Society.

Papua New Guinea, under new prime minister Peter O’Neill, is now coming under increasing pressure to pull out of its agreement on Solwara 1, following mounting criticisms both at home and abroad.

Other countries within the Pacific should do the same and bring a halt to DSM until more is known about its potential impacts.

Given the risks involved, island nations might be better off placing more emphasis on protecting the diverse marine biodiversity and seas within the Pacific — for example through the benefits that extra tourism can bring — and less on the economic gains to be made by exploiting the minerals that lie beneath them.