Papua New Guinea’s prime minister today (Aug 17) sought to sooth anger about his government’s increased stake in a mine at the centre of a decade-long civil war in Bougainville by giving part of it to the local community.
The huge Panguna mine on Bougainville island is one of the South Pacific’s largest mines for copper and gold but has been shut since 1989 after continuous attacks by secessionist rebels in a conflict that has cost an estimated 10,000 lives.
Anglo-Australian mining giant Rio Tinto had a 53.8 per cent stake in Bougainville Copper Limited (BCL), which controls the facility, but last month said it would gift its share to the PNG government and Bougainville’s autonomous administration in a move that would leave both parties with a 36.4 per cent stake.
It was the first time Bougainville’s autonomous administration had owned a stake in Panguna.
But the news angered local politicians, with Bougainville President John Morris’ saying then that his community could not accept equal or majority control of BCL by Port Moresby.
PNG Prime Minister Peter O’Neill told parliament on Wednesday his government – which already has a 19 per cent share of BCL – would transfer the 17.4 per cent stake gifted from Rio to Bougainville to “help to alleviate some of the legacy issues of the past”.
“With this transfer, the people of Bougainville will own a combined shareholding of 53.8 per cent of BCL,” he added.
“This ownership will also give landowners and the people direct control over environmental issues of any future mine development that will take place. By transferring these BCL shares to the people we are further strengthening the confidence of Bouigainvilleans in the peace process.”
There has been ongoing political sensitivities about Bougainville, which was granted autonomy by the PNG government in June 2005 and is expected to hold a referendum on independence in the next few years. PNG is due to hold national elections next year.
Bougainville’s separatist conflict was the bloodiest in the Pacific since World War II, and ended when the New Zealand government helped broker a truce signed by all factions in 1997.
Before it was closed, the mine produced copper concentrate for 17 years, which represented 44 per cent of PNG’s total export earnings at that time.
Arguments over environmental damages and compensation from its operation had been central to the conflict.