Govt commits 2% royalty from Tolukuma sales

Byran Chan

Loop PNG | June 9, 2017

The National Government has committed to pay landowners from the Tolukuma Project site a 2 per cent royalty.

This will come from the sale of gold from the gold mine.

This is the first of five major commitments outlined in the revised Tolukuma Gold Mine memorandum of agreement (MOA) signed yesterday in Port Moresby.

The commitments were announced by Mining Minister, Byron Chan, who urged the landowenrs to look after their money.

“Please ensure that royalty funds allocated to the Yulai Future Generation Trust are governed and operated under a Trust Deed and not to repeat the mistakes of existing operating mines where the stakeholders have wasted such funds on dubious investment proposals only to see no returns,” he said.

According to the agreement the state will pay project landowners royalty calculated at 2 per cent of free on board (FOB) of the sale of gold.

Landowners have agreed to split the royalty where Mining Lease Landowners recieve 80 per cent while the balance is split equally between Woitape LLG and Central Province Government.

Mining Lease Landowners have agreed to share 2 per cent of their royalty with the Women and Youth.

Other commitments in the MOA include:

  • The Special Support Grant (SSG) and Tax Credit Scheme (TCS);
  • The establishment of the Infrastructure Development Committee and Office;
  • Funding the annual operation cost of the Provincial Liason Officer to be based at Tolukuma; and
  • The establishment of a new Landowner Company with a clear clan-based shareholding structure and company requirements.

Meanwhile Yulai Landowner Association Chairman, George Gusi, refused to sign the MOA yesterday stating outstanding issues were yet to be discussed and that no proper consultation was done with the MRA.

MRA Managing Director, Phillip Samar, said the refusal of Gusi to sign does not affect the commericial agreement on the Tolukuma Mine.

Samar said they will continue to speak with Gusi to address any of the outstanding issues.

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Filed under Financial returns, Papua New Guinea

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