Lihir numbers not so impressive in the breakdown

gold

All Lihir’s gold has only delivered the equivalent of K2.67 per week for each New Irelander

Newcrest Mining has been proudly boosting [see below] about the royalty payments it has made from its Lihir mine in New Ireland. At first glance the numbers seems impressive, over K500 million paid out to the Provincial and local governments and landowners. Some may rightly ask where all that money has gone, as services and infrastructure in New Ireland are no better than in any other Province in PNG. But dig a bit deeper and Newcrest’s numbers don’t seem quite so impressive.

The royalty payments are a cumulative total after nineteen years of mining, break that K529 million down over 19 years and the annual figure is less than K28 million.

If that K28 million was shared equally among all the 200,000 people living in New Ireland, each would receive just K140.

So, the returns to New Ireland from 19 years of mining, K529 million, represents the equivalent of just K2.67 per person per week!

K2.67 per week from the production of over 9 million ounces of gold worth, at todays price, US$ 12,600 million (or K 40,000 million).

YES the gold taken from Lihir is today worth K40,000,000,000!

Lihir mine pays out royalty payment
Source: The National,aka The Loggers Times, Friday July 1st, 2016
THE Lihir Gold Limited had made royalty payments of K529,251,440 million to recognised parties in the past 19 years [an average of about K28 million each year].
It released a royalty payments update from 1997 to 2016 showing how much each party had received since 1997.
New Ireland provincial government received K264,625,720 million [K14 million per year] and the Nimamar local level government received K158,775,431 million [K8 million per year].
The special mining lease block owners  received K105,850,289 million [K5.5 million a year].
Lihir Gold Limited general manager Craig Jetson said royalty distribution from the Lihir gold mine was different from other mining operations in PNG.
This is because of an agreement by the State. A series of memorandums between the Government and the NI provincial government, LLG and Lihir Mining Area Landowners Association (LMALA), diverted all of the State’s entitlement to royalties to New Ireland.
He said the distribution were 50 per cent to the provincial government, 30 per cent to the LLG and 20 per cent to SML block owners.“For NIPG and NLLG, 100 per cent of their respective royalty portions is paid directly into their nominated bank accounts every month. “For the block owners, 5 per cent tax is deducted and paid to the Government and 20 per cent is paid as a savings component.”,” he said.

1 Comment

Filed under Financial returns, Papua New Guinea

One response to “Lihir numbers not so impressive in the breakdown

  1. R.ToVatup

    Lihir xxx.com.pg

    .

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