Monthly Archives: October 2015

Fiji landowners have no say when it comes to mine exploration

MRD clarifies mine licence

Sikeli Qounadovu| The Fiji Times

THE Mineral Resources Department (MRD) says the consent of landowners is not needed for companies to obtain a mining exploration licence.

The MRD, however, states that landowners will need to be notified that exploration will be done to their land.

MRD official Isei Raiyawa made the clarification at a talanoa session with villagers in Namosi on Wednesday saying landowners’ consent will only be needed if a mining licence is applied for.

Mr Raiyawa was reacting to questions raised by Namosi villager Sipiriano Nariva on why when majority of landowners had agreed to the termination of the Special Prospecting License 1420 (SPL 1420) for the Namosi Joint Venture (NJV), Government still extended the licence for another five years.

“The mineral is owned by the State and consent from landowners is not needed when it comes to exploration. What should be done is they need to be notified, which we had done. This work being conducted by the NJV is still in its exploration stage and not mining.” Section 3 (1) of the Mining Act states that all minerals “shall be deemed always to have been, the property of the Crown (State).”

Furthermore section 26 (1) of the Mining Act states that the Director of the MRD has the prerogative to grant a prospecting licence over an area not exceeding 400 hectares.

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Fiji PM calls for urgent meeting regarding NJV explorations

namosi exploration

 Aliki Bia | Fiji Broadcasting Corporation

Prime Minister Voreqe Bainimarama has called on the Mineral Resource Department and the Minister for Lands Mereseini Vuniwaqa to resolve the row over the granting of the special prospecting license to Namosi Joint Venture to explore minerals in the Namosi highlands.

During a talanoa session at Waivaka Village in Namosi yesterday, Prime Minister Voreqe Bainimarama heard that majority of the landowners there did not agree to the granting of exploration license to the Namosi Joint Venture.

Bainimarama says the discussions he had with the Minerals Resource Department is that everyone had been consulted and he was not aware that the exploration was destroying the environment especially the rivers.

With this concern, Bainimarama has called for an urgent meeting to resolve the matter.

He has also assured the people of Namosi that government will not allow any exploration to harm their environment.

The Landowners claim that those who were consulted prior to the extension of license are not registered to the village in the Vola Ni Kawa Bula.

The Prime Minister did not indicate when the urgent meeting will take place.

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Fiji government earns a pittance from Bauxite mining

Mineral Resources director Malakai Finau makes a presentation. Picture: SOLOMONE RABULU

Mineral Resources director Malakai Finau makes a presentation. Picture: SOLOMONE RABULU

Bauxite Mining

Vuniwaqa Bola-Bari | The Fiji Times

GOVERNMENT has earned about $1.2million from about $40m that the Chiping Xinfa Huayu Alumina Co. Ltd receives from selling bauxite.

This is about three per cent of the total amount after tax, which is received through the Mineral Resources Department.

This amount is then shared between Government and landowners once a formula for a fair share is determined by the State.

Since mining began at Nawailevu in Bua two years ago, Mineral Resources Director Malakai Finau said, they received $1,229,994.48 from the company as of August 20 this year.

Mr Finau told the Standing Committee on Natural Resources yesterday that this was the provision of the Mining Act with regards to bauxite.

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Mining Minister clueless on details of Tolokuma sale

tolokuma_mine

Joy Kisselpar | PNG Loop

Member for Kairuku Hiri Peter Isoaimo has demanded Mining Minister Byron Chan ensure a tailings dam is established before Tolokuma mine is reopened.

In Parliament today he raised concerns that when Tolokuma was sold to Singaporean firm Asidokona Limited the people of Goilala District and Kairuku Hiri District were not consulted.

Chan in response admitted he did not know details of the sale that took place between Asidokona Ltd and Petromin Limited.

“I have not been privy to the due diligence process or the process of the takeover, I was there to witness as the minister responsible for Mines and Petromin who owned Tolokuma,” he told parliament.

He says on the day he was told consultations did not take place because leaders of Central Province and their Governor were busy with meetings.

“But I was told consultations did take place,” Chan added.

Goilala MP William Samb and Central Governor Kila Hoada both refuted claims by Chan that consultations took place.

Chan explained that he does not know the details of sales because discussions on the sale were made between Petromin and Asidokana.

Central leaders have been told that they still have an opportunity to participate in discussions on the mine’s operations, tailings dam, and environmental damages. This opportunity is through the memorandum of agreement.

Tolokuma Mine was sold for K85 million to Asidokona Limited and an announcement was made earlier this month.

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Ramu mine locals not happy with land payments

pipe ramu

The National aka The Loggers Times 

PEOPLE living along the Ramu NiCo’s inland and coastal pipeline areas in Madang received payments for their land last week.
Many locals disagreed with the amounts, with some receiving K50-K80.
One landowner, Terry Aimai, said they were not happy with the amounts for the nine years usage of their land.
The Ramu NiCo management released a statement last Friday which the land compensation was done according to the agreement done when Highlands Pacific Ltd was operating. “The current land use payments by Ramu NiCo Management (MCC) Ltd is strictly in compliance with Occupational Fee (land compensation) payment component of the land and environment compensation agreement in 2000,” statement said.
Aimai said his clan received K900 which was like getting K100 for each year.
Ramu NiCo management did not want to reveal the rate it paid the landowners, saying it was the company’s confidential information and the rate would be discussed and changed in 2017 in the next review.
The current payment was for 2006 to 2014 since the project construction until last year (2014).

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New St Barbara boss Bob Vassie steers miner’s shares to 20-fold rise

Dumping a polluting mine on the people of the Solomon Islands proves very profitable for St Barbara shareholders…

St Barbara chief executive Bob Vassie. Glenn Hunt

St Barbara chief executive Bob Vassie. Glenn Hunt

Peter Ker | Australian Financial Review

Ten months ago gold miner St Barbara was only for the bravest investors. The stock was fetching 7.2¢, ratings agency Moody’s had named it the miner most likely to default on debt and St Barbara itself had warned that a tailings dam in the Solomon Islands was close to spilling and causing an international incident. The Simberi mine in PNG was producing gold at a cost that was roughly twice the gold price, and the whole thing seemed a bit of a mess.

What’s happened since under new boss Bob Vassie has been incredible.

The company’s flagship Gwalia mine in Western Australia had exploration success but the troubled Solomon Islands project was sold for a peppercorn price. A second mine in WA was shut and sold, while refurbishments to the mill circuit at Simberi  led to production rising to the best levels in three years.

Record production at Gwalia and Simberi meant 2015 guidance was beaten, and Moody’s improved its outlook on the miner’s debt.

The 15 per cent fall in the Australian dollar against the US currency added further tailwinds, and Deutsche analyst Matthew Hocking recently noted that St Barbara should be able to pay its 2018 bonds with $190 million of “headroom”.

St Barbara shares reached $1.44 on Friday; a 20 fold increase in just 10 months.

All of this is old news to the team at Hunter Hall Investments, who bought 47 million shares at $0.17, and a further 20 million shares when the stock was $0.22.

But the obvious question looms; has St Barbara’s amazing run gone as far as it will go?

Recent strong performance at Simberi will soon be tested as the wet season arrives in PNG. Most analysts expect gold prices to slide when interest rates are lifted in the US, and the bulk of the falls in the Australian dollar have been had.

Deutsche rates the company a “hold”, and believes St Barbara has a net present value of $1.20 per share.

“Exploration success (at Gwalia Deeps) and or higher gold prices are needed for upside from here,” said Mr Hocking in the note.

Shares were down 3 per cent on Monday for no particular reason, raising speculation that profit-taking is finally under way.

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China in frame as midwife to a Bougainville nation

The Australian

If China’s constructions on ­reclaimed rocks in the South China Sea are a headache for ASEAN, the US and Australia, what if Beijing became the patron of a large emerging island state that stares across the ­Pacific to the US fortress of Guam?

Earlier this year 130 operations were performed on the US Navy hospital ship Mercy. Its nurses, dentists and optometrists saw more than 6000 patients and its veterinary surgeons treated 140 dogs and cats and more than 2500 farm animals, during a two-week stay in Bougainville and in Rabaul, also in Papua New Guinea.

The US’s Pacific Command is a massive deliverer of humanitarian services every year around the Asia-Pacific. And Bougainville, an autonomous region of PNG, is a worthy recipient.

Conditions have deteriorated on the island, which after boasting the best living standards in PNG before civil war broke out in 1989 is now one of the nation’s worst performing provinces, with few job prospects and poor health and education levels, even for a country languishing at 157th of the 187 nations on the UN human development index.

But there is another, strategically potent, reason why the US might well wish to pay particular attention to Bougainville. That’s because within five years its 250,000 people will go to a referendum on independence and Bougainville, with deepwater ports and lengthy runways that could be swiftly rehabilitated, lies 2500km straight across the horizon from Guam.

PNG Prime Minister Peter O’Neill recently told The Australian a “yes” vote would not necessarily lead to independence, which remained the responsibility of the national parliament.

“We have a diverse and tribal country, so we can ask ourselves, where does it stop? We have no ­interest in thinking about independence, but about services, and the wellbeing of the people on Bougainville,” he said.

Nevertheless, the odds are strong on Bougainvilleans opting for independence. An independent but economically struggling Bougainville would be forced swiftly to seek patrons. The Autonomous Bougainville Government, led by former priest John Momis, has repeatedly stated an economically viable future requires the return of mining.

Rio Tinto has demonstrated its lack of confidence in reopening Bougainville Copper Ltd — which would cost an estimated $6.5 billion — by instigating a review of its 53.6 per cent stake, which has been under way for more than a year.

A groundbreaking ceremony, or Bel Kol (the cooling of anger), at which landowners, ABG, mine owners and other groups would bury the hatchet, has been postponed yet again due to the hostility of former combatants, some of whom retain their small arms.

It looks increasingly possible that Rio Tinto will walk away from the mine, which it was forced to close 26 years ago, despite it still containing copper, gold and other metals worth about $50bn and ­locals strongly backing its reopening at elections despite a hard core waving the threat of violence to keep it closed.

It could hand its shareholding to a trust for Bougainvilleans, as BHP did when it walked away from the environmental controversies at the Ok Tedi mine.

Or Rio could try to sell it, in which case the PNG government might be a buyer — or might ­nationalisation it, as happened at Ok Tedi two years ago. The ­national government is already the second largest owner of BCL, with a 19.1 per cent stake.

But nationalisation would be very hard to effect and counter-productive to the good relations needed for any chance of a referendum outcome supporting continued PNG sovereignty.

The bottom line is that only one source can provide the cash and the engineering required to resurrect the mine — the Chinese government. China is the only country to be expanding rapidly its aid — however tied — in the Asia-Pacific as part of President Xi Jinping’s maritime silk road ­vision.

Mr Momis, 75, a complex figure who has evinced strong nationalist feelings for PNG and Bougainville, has strong connections with Beijing, where he served as ambassador from 2006 to 2009.

Australia has worked to maintain strong links with Bougainville too, having played a major role, working alongside New Zealand, in the peace process and providing continuing aid. But the relationship suffered some turbulence when Canberra announced in the May budget the opening of a consulate on Bougainville before it had been fully agreed by Port ­Moresby.

Whoever becomes Bougainville’s best friend, whether it ­remains part of PNG or seeks to strike out on its own, must have deep pockets.

The stakes are also high, as Asia-Pacific waters, already the world’s most crucial trading channels, become increasingly crowded with the escalation of spending on ocean-going navies, including by Australia.

Bougainville has been a highly strategic island before. In 1943, it was where US fighters shot down Isoroku Yamamoto, the commander-in-chief of the Japanese Imperial Navy.

The Australian Strategic Policy Institute warned two years ago that “misunderstandings between Port Moresby and the ABG persist … The most likely referendum outcome — PNG refusing to ratify a clear but far from unanimous vote for an independence Bougainville is utterly unprepared for — would be destabilising”.

“Australian interests would be profoundly engaged if the situation there deteriorates sharply.”

ASPI director Peter Jennings added this week that the sharper maritime strategic competition emerging in the region made ­Pacific islands even more vulnerable to exploitation from powers eager to secure access for ships, aircraft and intelligence-gathering capabilities.

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