Bougainville admonished by O’Neill over planned mining change

Momis and O’Neill at a reconciliation ceremony in 2014. (ABC/AUSTRALIA NETWORK NEWS)

Radio New Zealand | 29 April 2019

The Prime Minister of Papua New Guinea has written to the Bougainville government asking it to consult more widely over proposed changes to the autonomous region’s Mining Law.

Peter O’Neill in a letter to President John Momis last month said the changes have the potential to cause discord and conflict.

Mr Momis said the law change will allow landowners to retain control of minerals once they have been mined.

But landowning groups, especially the Osikaiang group at the site of the key Panguna mine, allege this is an attempt to shut them out along with their preferred joint venture company, RTG.

James Onartoo of Bougainville Indigenous Rights Advocacy has accused Mr Momis of deliberately trying to spread misinformation on the matter.

He said the proposed amendment removes the protection of customary landowners’ rights and attempts to replace them with vague benefits and entitlements.

But Mr Momis in his response to Peter O’Neill said his government has since conducted extensive consultation on the new legislation

Wafi-Golpu selling idea marine waste dumping safe

Erebiri Zurenuoc | The National aka The Loggers Times | April 26, 2019

THE awareness on deep-sea tailing placement (DSTP) by the Wafi-Golpu Joint Venture team provided vital information for the people, says Labuta Local Level Government president Tups Waho.

Waho of Nawaeb district in Morobe said the awareness had been allowing people share their views on the project.

“The future of Labuta lies in the five-year development plan which must be captured in the proposed mining development plan,” Waho said.

“Two of the important impact projects covered in the five-year development plan are fisheries and eco-tourism because ward one to ward 13 are in the coast.

“There are a lot of fishing communities, and many locals use fishing as the means to generate income, and as a protein for their food.”

Labuta said people were still concerned about chemicals from the DSTP which might harm them.

DSTP engagement leader Andy Maie told Talec villagers tailings would only be harmful once it came into contact with air. “Our two-year study show that the deep-sea in the Huon Gulf peninsula is suitable for the proposed tailings displacement at depths of more than 200 metres,” he said.

“There is no risk of current upwelling and no fish life living beyond that 200-metre depth,” he said.

“The discharge will flow into the Markham canyon, to join the sediment discharge from the Markham and Busu rivers that flow towards the 9km deep New Britain trench.

“There are plans for monitoring stations to assess the sediment flows from rivers, monitoring of the ocean currents, fish sampling, water quality, and other studies.”

PM must come clean on Papua LNG

Logo at French oil and gas company Total gas station in Marseille. REUTERS/Jean-Paul Pelissier

PNG Blogs | April 29, 2019 

The Member for Moresby North-West, Sir Mekere Morauta, today questioned the legitimacy of the Gas Agreement the O’Neill Government has signed with the Papua LNG partners, saying the Prime Minister and his cronies have hijacked the approval process and put State and landowner interests at risk.

“I have seen evidence from a variety of sources that suggests we are heading for a repeat of the PNG LNG model which has brought few benefits to the state and landowners,” he said. “Peter O’Neill has shut out the State Negotiating Team and gone with a Gas Agreement that is largely the work of Total, ExxonMobil and Oil Search.

“The Department of Petroleum and other Papua New Guinean experts have been sidelined in favour of shadowy participants in the O’Neill Government’s corruption, waste and mismanagement. Why?”

Mr O’Neill’s interference in due process opens PNG to another financial disaster, as it did with PNG LNG and the UBS-Oil Search loan, Sir Mekere said. It risks resource owners not being paid their royalties and development levies, as has happened with PNG LNG. Mr O’Neill has still not provided answers as to where he has secreted the money, whether it is still there, and when resource owners will be paid.

It means that once again foreign resource giants have been granted huge financial and tax concessions that will cost the nation billions of kina in lost revenue. Mr O’Neill’s mismanagement of PNG LNG means the operation is still paying virtually no tax.

It means that questions remain about the actual technical and financial viability of the project. “Will it become another financial and social burden on ordinary Papua New Guineans that PNG LNG has become because of Mr O’Neill,” Sir Mekere asked

“Mr O’Neill and Total and its partners have many questions to answer. For now, I want to know why the State Negotiating Team and the Department of Petroleum have been sidelined. Who is advising Mr O’Neill?

“A potentially expensive and dangerous failure of due process has resulted from Mr O’Neill and his cronies taking over the negotiations. These failures are outlined in a letter to the Chief Secretary from the Department of Petroleum immediately before the Gas Agreement was initialed by Mr O’Neill and then signed by the participants.”

Acting Secretary Lohial Nuau wrote on March 27 that at least 11 critical documents have not been provided by Total which are required before any commercial and financial terms can be agreed to, nor has the Department received the required Application for a Petroleum Development Licence.

“The APDL, as per the Oil and Gas Act 1998, will require supporting technical documentation that will give confidence to the Department of Petroleum of proven gas and oil reserves, investment cost, project schedule and environmental compliance,” he wrote. “These are key parameters in the economic model and therefore form the basis for the commercial and fiscal negotiations.

“The department has received and reviewed from Total preliminary documents … for the purpose of discussing the APDL application process. These documents have shown little progress on the Papua LNG project and are NOT at the level of technical detail that the Department requires in order to make a decision on an APDL. In addition in the letter from Total of February 8, Total committed to an APDL application on March 15, 2019. Until today the Department has not received such application.

“Based on the fact that none of the required documents have been submitted and the Department of Petroleum has no ability to verify any of the important economic parameters provided by Total in the economic analysis, I come to the following recommendations to the SNT:

1. Because no Application for an APDL and associated licenses have been submitted. On January 29 2019, I requested Total, as required by the Oil and Gas Act 1998, to apply for these permits and provide the Department of Petroleum with the supporting documentation urgently.

2. As the Department of Petroleum has not received the application for the APDL including any of the Technical documentation required by the Oil and Gas Act 1998, the Department cannot review and endorse any of the key economic parameters provided by Total in their economic model. Therefore the Department recommends for Total to urgently submit the APDL and all supporting documents before input can be provided to the Gas Agreement.

3. Social Mapping and Landowner Identification process still has to be completed. Therefore there is no proper due diligence by the stakeholders on the Gas Agreement. The Department recommends for Total to urgently complete the SMLIS. “

Sir Mekere said: “These are damning comments from the department. They are supported by evidence from other experts who have been following Papua LNG progress, and are alarmed at the multi-billion-kina risks that Mr O’Neill has exposed the nation to.

“I am also concerned about reports of visits to China by O’Neill officials in the company of Total executives. I am surprised at Total’s willingness to associate itself so closely with Mr O’Neill and his cronies. I would hate to hear any suggestion of a special sale of an interest in Papua LNG.

“A new Government must review the agreements personally entered into by Peter O’Neill to make sure that the State, the landowners and the developers share the risks and the benefits fairly,” Sir Mekere said.

Indigenous Rights Advocacy Group says ABG President Momis is not telling the truth

Prime Minister O’Neill has written to the ABG President raising concern over proposed changes to the Bougainville Mining law; concerns Momis is trying to downplay using ‘misinformation’

Chairman of a human rights organization, Bougainville Indigenous Rights Advocacy (BIRA), James Onartoo, has raised concerns that the ABG President Momis is deliberately trying to spread misinformation to push his government’s proposal to amend the Bougainville Mining Act.

Mr. Onartoo was responding to a draft letter of response by President Momis to concerns expressed by the Prime Minister in his letter to the President on the proposed amendment. The letter in which the President downplayed the Prime Minister’s concerns was posted recently on social media.

Mr. Onartoo said that the proposed amendment drew wide opposition because it removed protection of customary landowners’ rights and attempted to replace it with vague benefits and entitlements that lacked detail.

“You cannot remove and replace existing protection of the rights of customary landowners with imaginary rewards that may never materialize in the end,” he said.

Mr. Onartoo was also critical of the way ABG was handpicking people to drum up support in the mine affected areas to help push through the amendments. He said the ABG had never obtained “free, prior informed consent” (FPIC) in the mine affected areas and instead it has tried to avoid those who opposed mining, causing further divisions in the mine affected communities.

“Under FPIC the people have the right to say no to mining and the government should respect the wishes of the people and support them. Instead the government has gone abroad to make a deal and it is now trying to involved the landowners after the laws are drafted along with the proposed amendment to cater for monopolization of mining by a single mining company ”, Mr Onartoo said.

The Vice President, Raymond Masono and Finance Minister Robin Wilson left yesterday for Port Moresby to hand deliver the letter from President Momis to the Prime Minister, Peter O’Neill.

Meanwhile, ABG Parliamentary Legislative Committee’s inquiry into the amendment bill continues in Central Bougainville and according to it’s Chairman and member for Kokoda constituency, Rodney Osioco, there is a growing opposition from all stakeholders and the general public, to the proposed bill by the ABG to amend the Bougainville Mining Act.

More than 40 million people work in artisanal mining- report

Alluvial miners at work on Bougainville

Peter Hobson | Reuters | 25 April 2019

More than 40 million people around the world work in artisanal and small-scale mining where minerals including gold, diamonds and cobalt are dug up often by hand, a report by the World Bank and development organisation Pact said on Wednesday.

Increasing demand for metals and rising prices have triggered a boom in small-scale mining in recent years, mainly in poorer countries in South America, Africa and Asia.

These mines are a vital source of income for communities, but many operate outside the law and leak chemicals into rocks, soil and rivers. Working conditions can be appalling, and the metal and stones dug up are often smuggled across borders on a vast scale, sometimes by criminal operations.

Billions of dollars worth of gold is being smuggled out of Africa, a Reuters investigation found this week.

The World Bank and Pact said too little was known about how many people worked in small mines and previous estimates, which were often far lower than 40 million, tended to be partial or rely on outdated data.

“It’s time to shine a light on this vital sector so we can accelerate investments in people and communities for greater equity and sustainable economic growth,” Riccardo Puliti, the World Bank’s head of energy and extractives global practice, said in a statement.

The report said 16.3 million people worked in small-scale mining in South Asia, of which 12 million were in India, and 9.8 million people in East Asia and the Pacific, of which 9 million were in China.

Another 9.9 million people worked in sub-Saharan Africa, the report said, with 2 million in the Democratic Republic of Congo and between 1 and 1.5 million each in Sudan, Ghana and Tanzania.

Just over 2 million people work in the industry in Latin America and the Caribbean, with 1.9 million more in the Middle East and North Africa and 100,000 in Eastern Europe and Central Asia, it said.

Thirty percent of the workers globally were women, the report found.

Minerals mined in small-scale and artisanal mines include gold and diamonds, used for jewellery and investment, and tin, tungsten, tantalum and cobalt consumed in industry, electronics and batteries that power electric vehicles.

O’Neill’s lies show he still wants to get his tentacles on $1.4 billion

War of Words Over PNG SDP Gets Even Hotter

Mekere Morauta | April 25, 2019

The Member for Moresby North-West, Sir Mekere Morauta, said today that Peter O’Neill’s statement that BHP Billiton and I created PNGSDP as a private company with four shareholders, one of whom is me, is a deliberate lie manufactured by a man desperately trying to repair his public face following the comprehensive win by PNGSDP in the Singapore Supreme Court.

“Peter O’Neill also lied to the Singapore Court, through the State’s affidavit, saying he had a document giving the State the power to control PNGSDP,” Sir Mekere said. “He failed to produce the document as evidence to the Court, and the court decision exposed him as the liar he is 

“Why did he not produce such a document? Because no such document exists. He made it up, hoping this would convince the Singapore Court.”

“Why is he still lying? Because he wants to get his tentacles on the $1.4 billion in PNGSDP’s Long Term Fund.”

PNGSDP was established by the State of Papua New Guinea, BHP Billiton and Inmet, the shareholders of Ok Tedi Mining Ltd in 2000, to hold the BHP shareholding (then 52%) gifted by BHP.

The object of PNGSDP was to invest two-thirds of the future dividend flows from the shares into a Long Term Fund to be used after mine closure for sustainable development in Western Province. One-third of the dividend income was spent on development projects throughout the country, including Western Province.

PNGSDP was established as a not-for-profit company, limited by guarantee. It has no shareholders. In such company structures, used by charities, NGOs, sporting groups and other similar organisations, shareholders are replaced by members. I am a member of PNGSDP, not a shareholder.

Members do not derive any benefit from a limited guarantee company, as shareholders would from a limited liability company. The Program Rules, set jointly by the Government of PNG and BHP, prescribe that the benefits from PNGSDP flow only to PNG and Western Province.

Singapore documents purportedly showing I am a shareholder are pro-forma documents that do not provide for companies limited by guarantee. They do not provide for members instead of shareholders, as happens in many jurisdictions.

“The statement that I am a shareholder of PNGSDP is a naked, diabolical lie,” Sir Mekere said.

“Increasingly, it seems that the Prime Minister is fabricating stories to cover his own misdeeds. If he actually believes his own lies, we should all be worrying about not only his level of intelligence, but also his sanity.

“The man is not fit to be Papua New Guinea’s Prime Minister.

 “Peter O’Neill’s ceaseless attacks on PNGSDP and on me are due to his failure to gain access to the Long Term Fund – which is what he wants, desperately.

 “He was not satisfied with the extremely valuable shareholding PNGSDP had in Ok Tedi, which he expropriated in 2013. He also wants the Long Term Fund, which now stands at over $1.4 billion. He wants the lot.

 “I want to assure the people of Western Province that their money in the Long Term Fund is safe, and will continue to be safe, whilst it is managed by an independent PNGSDP. 

“It was my instruction to the advisory team when PNGSDP was established that the company was to be protected from political influence – from the tentacles of octopuses.

“The Singapore Court decision proved the independence of PNGSDP. I am proud that I led the fight and won it for the people of Western Province.”

Gulf Landowners Take Papua LNG Dispute To Court

Post Courier | April 25, 2019

Three weeks after the State signed the gas development agreement with Total SA and its minor partners to develop the US$13 billion gas project in Gulf Province, dissent continues to be voiced among key stakeholders.

Disgruntled landowners from Baimuru LLG in Gulf Province who host the Elk and Antelope gas fields are taking their dispute to court.

In a media conference yesterday in Port Moresby, a group led by former political leaders Roy Evara, Havila Kavo, and former diplomat Jacob Kairi stressed that any signing of a memorandum of understanding between the State and the Gulf provincial government in Kerema would be deemed illegal because it does not comply with section 47 of the Oil and Gas Act.

This part of the Act, they claim, is crucial that the developer had to identify the landowners but this has not happened yet.

“We sit here as disgruntled people of Baimuru,” said Rueben Akia, a spokesman of the group.

“We think that there is possible breach of the Oil and Gas Act. By law our voice should be heard in a development forum.”

Mr Kairi shared similar sentiments, saying: “The provincial government is running ahead of the people.”

The group has demanded that the proposed MOU and any other agreements between the Gulf provincial government and the State outside of the development forum, as required by the Oil and Gas Act must not be signed.

Roy Evara Jr who leads the Purari development association, said the landowners are united and would pursue proper administrative process.

“What is about to take place between the provincial government and the State breaches the Oil and Gas Act,” he said.

“We’d like to urge caution, we are not in the dark. We want our resources to be developed according to our wishes and in line with the laws.”

The NEC was to deliberate on the MOU before signing today in Kerema but it has been deferred.

Gulf Governor Chris Haiveta has confirmed via WhatsApp message about the deferral but did not detail why it was so when inquiries were made.

Environmental failure at Wild Dog mine

Traditional Baining Fire Dance

Alois Balar | Post Courier | 23 April 2019

Beyond reasonable doubt, the element of environmental risk was present in both the exploration and development stages of the Wild Dog mine.

This mine was developed at the very summit of the highest peak in ENB with the presence of this significant environmental risk, and to the detriment of the livelihoods of the people at the foot of Mt Sinivit as well as within its vicinity and right down to the coast. What rational justification was used by the (relevant government agencies) and the landowners to agree for the mine to be developed given the geographical risk to the river systems?

Mineral deposits in the mining lease area comprised of the oxide and the sulphide zones both of which were not technically viable to be developed at such steep slopes with very high loss of height. Juxtaposed against these is a high mountain backdrop (with huge physical divides) that forms the catchment of the river systems on all sides. These areas contain critical ecosystems and life support systems. The mine heap-leach areas were pitched on narrow patches of no more than 20sq m, at most, in both zones, with no fenders, that were susceptible to climate extremes.

This mine was developed on “persistence in error” by the developer who refused to draw inference from negative signs and technicalities. The developer should have waylaid the “sunk-cost effect” in favour of the critical environment.

It is very disturbing that the (relevant government agencies) have been sitting on this environmental problem since the developer abandoned the mine during its operation.

The cyanide heap-leach method should never have been allowed to be used up there by the developer. The developer abandoned huge open pits, heaps, and the ponds of cyanide which are a risk to the whole environment. Some of these heaps and ponds have cracks caused by earthquakes.

The recent rains caused the cyanide vets to overflow into the drains that fed the sources of streams and creeks that tributed to the two large rivers of Nengmutka and Rapmarini which are major tributaries of Waragoi river.

Once the toxics leak, it can result in total collapse of ecosystems and life support systems that are being used by the people(I don’t want to mention the deadly strength of cyanide against the volume of water in the rivers) . This mine was at a critical location and dangerously and carelessly developed out of economic greed.

Five long years have lapsed after the developer left with evidently nothing done to date to contain the leakage risk. These relevant government agencies have just woken up from their slumber to sanction a disaster and environmental assessment to be carried out.

The funds being spent on rebuilding the road up to the mine to enable the assessment to be carried out could have been spent on other impassable roads in the Bainings).Is this how long bureaucratic red tape can last in our government system, even if it meant so many people dead from a cyanide disaster over five years?

This kind of irrational behaviour by govt agencies could prove fatal for the communal environment and costly to the lives of the people. The lack of action by government agencies has resulted in people(men, women, and children) risking their lives by going up there to the mine site(after the developer left) to take whatever is useful to them, thus having direct contact with cyanide and
other toxic chemicals.

Leach pad liners were even taken by people, posing serious risks to themselves! The government’s complacency and ignorance of problem risks and for taking no leakage deterrent measures conjures up the reality of its ignorance of the height of thresholds for pain of the people and the environment when inflicted for economic reasons other than for their own benefit and upkeep.

Government agencies must ensure economic development is balanced against the natural environment, not the other way around! This is an aspect of sustainable development!.

The problem at Wild Dog is not ISEP, rather, it is everybody’s. And I’d rather the so-called Sinivit Mine Landowners Association stops talking about mine reopening and look more closely at ensuring the sustainability of the sources that support the livelihoods of its members and make sure these sources are not compromised.

Landowner Calls For Investigation Into Warden’s Hearing

Government Urged To Intervene.

Yombi Kep | Post Courier | April 17, 2019

A landowner in Porgera is calling for investigation into the Mining Wardens Hearing held at Paiam Sports Oval in Porgera, Enga Province on Tuesday 2nd April 2019.

Landowner and former member for Lagaip-Porgera, Opis Papo is supporting the allegations made by Justice Foundation Chairman Jonathan Paraia that the illegal miners were unduly influenced to support Barrick Niugini Limited’s application to renew their SML and other tenements.

Mr Papo made the call after reading a report in Post Courier on the 15th of April 2019 at page 25 titled “Barrick refutes claim”.

According to the report Barrick Niugini Limited (BNL), the majority owner and operator of the Porgera gold mine has dismissed an allegation describing it as entirely untrue that it supports illegal mining. Barrick further said they did not condone illegal mining in any form and has consistently sought in cooperation and partnership with the government to discourage people from engaging in this activity which is not only unlawful but extremely hazardous.

However, Mr Papo said that even though everyone in Porgera including Jonathan Paraia and himself do not support illegal mining in Porgera, they are genuinely concerned about the conduct of Barrick in appreciating the illegal miners at the recent wardens hearing at Porgera.

“The illegal miners support for Barrick was never an isolated event, it was done in the full knowledge and active support of Barrick, whereby in front of thousands of people, the media and government officials, the Barrick’s senior manager, Timothy Andambo publically thanked and appreciated the support of the illegal miners in their quest to renew their license to mine for another 20 years.”

He added that the Government must now conduct an investigation into this incident as it has been spending millions of kina since 2009, to police illegal mining in Porgera and developer Barrick has undermined firstly, the government’s costly effort and secondly such conduct may have breached relevant PNG laws.

Papua LNG: An Open Letter to Dr Fabian Pok by Hela Governor Philip Undialu

Philip Undialu MP | PNG Blogs | April 16, 2019 

I have some real issues for your clarification and they are;

1. Why did State ignored recommendations or proposal by State Negotiation Team or SNT backed by Ashurst, KBR, Wood Mackenzie, and signed a completely different agreement? I have confirmed with some SNT members and let’s not fool fellow leaders, professionals and our people in general.

2. Why did State signed an agreement when Total failed to submit important requirements of law? I have confirmed that the from Acting Secretary Petroleum to Chief Secretary as Chairman is real, there exist such a signed letter and State brushed that and signed.

3. Why did State ignored StateSol advice on serious implications? His media statement this week Wednesday confirms that Gas Agreement is subject to Total fulfilling necessary requirements. What do you think those necessary requirements are? And are those requirements not necessary to be complied with first? Why did we ignored advise for six months adjournment?

4. Why did State ignored 3 consecutive letters from Governor of Central Bank not to sign the Agreement until our Monetary regulatory requirements are complied with? In the letter, he warned that he let go the the first LNG project though fundamentally flawed GA but will not be allowed again.

5. Why did State give Tax Exemptions having known we lost K6.0 billion from PNGLNG? PNG stand to loose another K6b or more because of the GST and other exemptions.

6. Corporate Tax used to be 45% since first Oil Project in 1990 but reduced to 30% under PNGLNG. Why did State ignore SNT reccommendation to bring back to 45%? A lost of 15% is a serious question State need to be responsible because we will again loose Billions of Kina every yeat.

7. If we can reduce Tax exemptions and reduce Corporate Tax, why didn’t we ask for exemptions on Sunk Cost as recommended by SNT? As announced by DPM , we will pay our sunk costs after first sale of gas. Remember, any capital cost you want to pay after project construction will apply Premium costs ranging 10-30% on the principle amount.

8. On one end, we talking about better deal on DMO but I think developers playex dump fool on us. Why I say this? Because currently for NiuPower and Dirio Power, we are paying gas price at 9% Japanese Crude sales price or US$5/mmbtu. The Papua LNG agreed pay around US$5/mmbtu. That is, 9% of JCS is same as $5. Therefore, i think we have been fooled.

Why did we ignore SNT recommendation for 2% JSC and went for $5/mmbtu or 9% JSC which means the same thing?

9. Why Central Provincial Government, very host of pipeline and LNG facilities NOT invited to be a party to the agreement?

10. Did we agreed for 2% Gross Wellhead Value payment for Royalty and development Levy? Under the PNGLNG, they are literally deducting 1.6% and paying only 0.4% because of deductions such as Opex, Capex, and Premium on Capital cost. Over the last four years (2014 -2017) we lost K1.2billlion. Did we ever leant from that?

11. The SNT team had a clause called “Lessons Learned from PNGLNG”. One of the lessons learned was the confirmation that PNG lost K48 billion from construction phase to operation phase. What actions have we taken to correct that?

12. State need to explain to the parties affected by PNGLNG project wether or not there will be any implications as Papua LNG likely to share common facilities.

13. I heard that the Financial Model doesn’t even incorporated financing and refinancing in their Open Book Economic Model. The numbers used in the economic model is only Class IV – ORDER OF MAGNITUDE COST ESTIMATE of +- 50 %. The likely high case cost estimate for the overall project will be plus 50% of the current estimate of US $13 billion.

14. The Foundation Volume is rumoured to be stated as 10.3 tcf, when their outdated proven reserves is only 6.7 tcf. Where will the extra 3.4 tfc of gas will come from. What’s the Basis? For any Petroleum project, the Foundation Volumes determines everything from Field Development Plan to Cost Estimate, Financing. Etc. Also clarify how the treatment of P’nyang and PNG LNG gas will be like if there’s shortfall on committed gas supply for Papua LNG.