MCC heavyweights in PNG to protest lack of profits and seek further subsidies

MCC's Ramu mine headquarters in Madang

MCC’s Ramu mine headquarters in Madang

A delegation of senior MCC officials from China have been in Papua New Guinea this week to protest about the lack of profits from the Ramu nickel mine and seek further concessions from the government on top of their existing 10-year tax holiday and government subsidies for vital infrastructure and landowner negotiations.

MCC vice president Xiao Xuewen and chairman of Ramu NiCo management Zong Shaoxing spent Sunday and Monday meeting with Government ministers, including  Mining Minister Byron Chan, Environment Minister John Pundari and Transport and Infrastructure Minister William Duma, in Port Moresby.

China Metallurgical Corporation (MCC), is the major financier and shareholder in the Ramu nickel mine.,

MCC is looking for further government support as the Ramu mine is yet to deliver any profits since construction started 10 years ago and losses are expected to increase this year as world metal price slump and many mining companies around the world are shutting down operations

Xuiwen told the government that in order to prevent mine workers, contractors and suppliers from losing their jobs, it was necessary for “MCC Group and Government to put a joint effort to ensure survival and development of the project”.

MCC says Minister Chan assured that his office and the Mineral Resources Authority would be doing their best to help the Chinese.

Environment Minister John Pundari told the Chinese his department would continue to assist and support the development of the Ramu mine – clearly forgetting that his department’s role is supposed to be as an environmental watchdog ensuring the highest standards and protecting the people and environment rather than providing a support service for foreign mining companies!

1 Comment

Filed under Financial returns, Mine construction, Papua New Guinea

One response to “MCC heavyweights in PNG to protest lack of profits and seek further subsidies

  1. I’m puzzled about the 10-year “tax holiday” you refer to (which presumably is coming to an end, since it is now ten years since construction began). If you are talking about a tax on profits, then they’d have paid no tax regardless, right? And if they start turning a profit, then why not ask them to start paying tax? But meanwhile, the tax arrangements would be irrelevant to whether mine workers, suppliers, and contractors keep their jobs. So MCC must be asking for something more than an extension on the tax holiday.

    As for the Environment Minister telling MCC his department would continue to assist them – yes, as far as I know, the primary way a watchdog can assist. That’s by keeping its eyes shut. I don’t know if the watchdog has been awake or not, but there again, it seems as though MCC must be expecting something more than just a “blind eye” from the Environment Minister. He does not seem to have done anything to substantially delay mine work. What more can he offer? Special permit for additional pollution? But why bother, since they haven’t followed up any of the past pollution events? Something is going on that I don’t understand.

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