Category Archives: Exploration

Crater Gold Mining is reinvigorated, debt free and focused on PNG gold

Alexander Molyneux, proposed chairman

Papua New Guinea is home to multi-million ounce major gold mines

Proactive Investors | 24 July 2017

Crater Gold Mining Ltd has undertaken a transformation change, and is back trading on the ASX.

New funding will retire material debt and leave circa $4.3 million to $5.1 million in cash to pursue its strategy at the flagship Crater Mountain Project in Papua New Guinea.

The new “Crater Gold” company will have a recognised mining industry leader on the board and in management.

The project is highly prospective, and contains two separate existing epithermal gold Inferred Resources which combined exceed 800,000 ounces of gold.

This resource was formulated from just 14,500 cumulative linear metres of drilling that mainly took place in 2010-2013.

At the time the company became side-tracked the proposed development a small-scale mining operation and taking on a debt burden to do so.

A re-invigorated Crater Gold aims for a transformational increase in resources, which will be done by the purchase of two drill-rigs to be based at the project.

This will deliver over 10,000 cumulative linear metres per year.

Funding strategy

The funding injection will include up to $16.2 million, comprising:

– A 11 for 2 renounceable pro–rata entitlement offer at $0.01 per share to raise at least $13.0 million and up to $15.0 million before costs; and
– The proposed conditional sale of 100% of non-core Croydon Project for $1.2 million in cash.

Why Papua New Guinea

Papua New Guinea is home to multi-million ounce major gold mines with operators such as Barrick, Newcrest and Harmony present.

The country’s annual production exceeds 2.1 million ounces and has been growing.

PNG also offers a stable and competitive tax and regulatory regime – no material change in minerals law for 25 years – and the currency is ‘pegged’ to USD.

Adding further interest, incoming directors regard the owner of nearby Kainantu Project, K92 Mining as a key relevant peer.

A new name and new board

The current proposed name change is to Paradise Gold Mining Ltd.

Sam Chan and Richard Johnson have agreed to resign from the company’s board and three new proposed directors have agreed to join on completion of the entitlement offer.

The three new proposed directors are:

  • Alexander Molyneux, proposed chairman – 20-years’ experience in the minerals industry as an executive, director and specialist industry investment banker.
  • Dorian L. (Dusty) Nicol, proposed non-executive director – Career geologist with over 40-years’ experience in discovery and resource development. Worked extensively in Papua New Guina for Esso Minerals and Rennison Gold Fields, including on Crater Mountain and Kainantu projects.
  • Robert Usher, proposed non-executive director – Mining engineer with more than 25-years’ experience. Significant gold production experience including in PNG with Placer Dome at its Porgera operation from 1993 to 1999.

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Bell Potter beats drum for PNG minerals explorer float

Ex-New Hope boss Rob Neale lines up as chairman of ASX-hopeful Mayur Resources. Glenn Hunt

Sarah Thompson, Anthony Macdonald, Joyce Moullakis | Australian Financial Review | 24 July 2017

Fund managers will recognise some of the names behind PNG minerals exploration company and initial public offering-hopeful Mayur Resources, which is seeking to hit the ASX boards on September 1.

Queensland resources industry veteran and former managing director of Soul Patts’ coal play New Hope Corporation Rob Neale lines up as chairman, while former Hancock Prospecting executive Paul Mulder would run the listed company as managing director. 

The pair would be joined around the boardroom table by former Gloucester Coal deputy CEO and BHP Billiton iron ore executive Tim Crossley, and former Credit Suisse metals and mining research analyst Paul McTaggart, among others. 

Mayur Resources was seeking to raise up to $15.5 million via the sale of CHESS Depository Interests at 40¢ each. The company is incorporated in Singapore, with operational headquarters in Brisbane and assets in Papua New Guinea. 

In a prospectus lodged late last week, chairman Neale told potential investors that Mayur had been operating since 2011 with the aim of acquiring, exploring and developing mineral and energy opportunities in PNG. 

Funds raised were pegged for a definitive feasibility study of the company’s Orkolo Bay Industrial Sands Project, and to deliver a resource estimate for its Port Moresby Limestone Project, among other uses. 

CEO Mulder doubled as the company’s largest shareholder, with a 52.6 per cent stake prior to the IPO. 

Bell Potter is running the IPO as lead manager and was scheduled to open the raising next week. 

The offer was not underwritten. If successful, the company would list on September 1.

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Anglo American becomes manager of PNG prospect

Foreign mining companies trade Papua New Guinea rights with no reference to local people or the authorities

Australian Mining | July 20, 2017

Anglo American has taken control of the Star Mountains copper-gold project in Papua New Guinea.

Management has been transferred from ASX-listed Highlands Pacific after Anglo fulfilled an agreement to spend $US25 million ($31.4 million) at the site.

Under the JV arrangement, executed in February 2015, Anglo acquired rights to an initial 51 per cent interest in Star Mountains by paying Highlands $US10 million.

The majority ownership is being earned in phases, with Anglo to gain 15 per cent through a farm-in spend within the first four years. The remaining 36 per cent will be acquired by Anglo if an inferred resource of 3Mt of copper equivalent is identified within five years.

Anglo has now spent $US25 million at the project to gain 15 per cent ownership, which also triggers the transfer of project management from Highlands.

Craig Lennon, Highlands chief executive officer, said the exploration program at Star Mountains was proceeding as envisaged in the original agreement.

“Exploration is advancing steadily and drilling results continue to suggest the tenements may host a large copper porphyry that could ultimately underpin a significant copper and gold mining project,” he said.

Several drilling campaigns have been completed at Star Mountains over recent years, Highlands explained.

The current campaign, funded by Anglo, was launched in October 2016, with five holes completed and additional holes to be drilled by the end of next month.

Anglo can take an 80 per cent interest in the JV by completing a bankable feasibility study by 2030.

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Caritas Calls For Halt To Experimental Deep Sea Mining

Caritas Aotearoa | SCOOP | 13 July 2017

“We call for an immediate halt to all deep-sea mining including exploratory testing as this will undermine the ability to achieve sustainable development goal 14” said Julianne Hickey, Director of Caritas Aotearoa New Zealand, speaking in New York at an event associated with a United Nations High Level Political Forum on the progress towards achieving Sustainable Development Goals.

Mrs Hickey expressed deep concerns about the long-term impact on the oceans and marine life arising from experimental Deep Sea Mining.

“Such mining is far from being an established practice around the world. The technology involved is in its infancy and it is not credible to talk about so-called ‘best-practice’ regulatory regimes in the Oceania region. The fact is that many of the countries in which multinational mining corporations are seeking licenses do not have established regulatory scrutiny of such activities.”

“A factor that exacerbates the risks is the huge reliance of communities on the oceans. For example our community partners in Kiribati and the Solomon Islands rely on the oceans and healthy marine ecosystems for their very livelihoods” said Mrs Hickey.

But there was some good news too. Caritas welcomed two specific initiatives towards better care of the oceans and marine resources. In particular Mrs Hickey highlighted the development of special Marine Protection Areas in Tonga.

“The development of Marine Protection Areas at Felemea in the Ha’apai Islands of Tonga signals a very welcome approach to sustainable use practices in the region” said Mrs Hickey.

“We also acknowledge and welcome the move by the New Zealand government to ban plastic microbeads which have been shown to be harmful to waterways, fish and shellfish” said Mrs Hickey.

Mrs Hickey was speaking in New York this morning (NZ time) to an event associated with a United Nations High Level Political Forum on the progress towards achieving Sustainable Development Goals. The specific goal on which Mrs Hickey presented was Goal 14: conserving and sustainably using the oceans, seas and marine resources – with regard to the Oceania region.

Mrs Hickey is representing Caritas Oceania in order to ensure that the voices of Pacific peoples are heard on the world stage. Caritas works closely with partner organisations around the Pacific region – including Samoa, Kiribati, Fiji, Tonga, Solomon Islands, Vanuatu and Papua New Guinea.

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Filed under Environmental impact, Exploration, Human rights, Mine construction, Pacific region, Papua New Guinea

Downturn in exploration affects jobs [oh, and our profits too!]

Nice bit of spin from the mining industry – all they care about is their own PROFITS not jobs for local people!

The great news is the people in the picture still have jobs living on and farming their own land. What the foreign mining execs are really worried about is losing their own jobs!

The truth is the foreign mining companies depend on PNG, but PNG does NOT need to depend on them. Sustainable development in PNG should be about agriculture, tourism and small manufacturing NOT big destructive mines!

Loop PNG | 11 July, 2017

A significant downturn in mineral exploration has resulted in loss of jobs and business opportunities in the country.

In its bi-monthly issue, the PNG Chamber of Mining and Petroleum highlighted the drop in exploration investment, which has the potential to severely impact the country’s mining sector.

In a survey conducted by the Chamber, covering the period between 2012 and 2015, mineral exploration expenditure dropped from a peak of K944.3 million in 2011 to K325.5 million in 2015.

This followed a near decade of high activity from 2003 to 2011.

The Chamber adds despite feasibility studies for the Frieda River and increased exploration expenditure in 2015 for the Wafi-Golpu Project, the overall expenditure was still well below 2013 levels.

The downturn has already affected many rural Papua New Guineans through the loss of direct employment and potential new business opportunities, while businesses and suppliers have also lost much-needed income as a result of many junior exploration companies ceasing their operations.

During the Chamber’s annual general meeting, president Gerea Aopi said this concern is exacerbated by the proposed changes to the mining act.

“We have to make every endeavour to ensure that this downward trend does not continue, although we have little or no control over the global commodity price market,” Aopi said.

“What PNG can control is the fiscal and legal frameworks that directly impact this sector. Our aim must be to ensure PNG can continue to grow existing projects and also foster an environment conducive to attract new investments.”

Aopi further added that the lodgment of Special Mining Lease applications for Frieda River and Wafi Golpu projects last year is an indication of why PNG must maintain its investment attractiveness.

“These projects are very important to the PNG economy as existing mines like Ok Tedi, Porgera and Lihir are in mature stages.

“Both projects, when developed, will have positive economic impact for PNG and together with the operating mines, could place PNG as one of the top copper and gold producers in the world,” he said.

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Filed under Environmental impact, Exploration, Financial returns, Human rights, Papua New Guinea

Pacific Bauxite accused of tricking Solomon Islanders over mining rights

Tomoto Neo, Nendo, Santa Cruz Islands, Solomon Islands. A bauxite mining proposal has divided the small island community. Photograph: Alamy Stock Photo

The Australian mining company denies any impropriety and says landowners are keen to find out if there are mineral resources on their land

Ben Doherty | The Guardian | 6 July 2017

An Australian mining company is embroiled in a standoff with landowners in the Solomon Islands over allegations it coerced, bullied and tricked communities into signing over prospecting rights to their land.

A government has been overthrown and local landowners have taken to blocking the roads with stones, and even reportedly confronting miners with bows and arrows, to thwart prospecting on their island of Nendo, in Temotu, the easternmost province of the Solomon Islands.

The miner Pacific Bauxite denied any allegations of impropriety and said it had worked in close consultation with landowners who overwhelmingly supported their work. So far it has engaged only in hand-augered prospecting.

“Landowners are also very keen to determine the potential for minerals resources on their land,” it said. “Prospecting provides landowners with a free evaluation of their land while not committing to mining.”

The company’s application to prospect had divided the Nendo community, a former Solomon Islands governor general has said.

Several Nendo residents have said dozens of landowners across the island had withdrawn their authorisation for Pacific Bauxite to prospect on their land.

The company said it was not aware of any landowners withdrawing their consent and that it remained committed to consulting with all owners.

Some Nendo landowners have said they were not properly told about the environmental impact of mining, and others claimed they were coerced into signing, told to sign blank pieces of paper, or had their signatures forged.

Ruddy Oti, a Temotu landowner and legal adviser to the Temotu Conservation and Sustainable Development Association, told the Guardian many people on the island felt they had been manipulated into signing surface access agreements for the company on their land.

“There was no proper consultation, people were not informed about the potential impacts on their land,” Oti said.

“People were asked to sign blank pieces of paper and those signatures were collected and used to say these landowners have agreed to have prospecting on their land. They did not agree.

“Some signatures were forged. When I went to see those people, they said they had not agreed.

“And some landowners said they felt pressured to agree, or that they weren’t told about the impact upon their land. Those people have now written sworn affidavits to revoke their consent.”

Oti said landowners were resolute in their opposition, having seen the damage of logging on other parts of the island. Some villages have reportedly put roadblocks up to stop miners’ access or threatened vehicles with bows and arrows.

A video clip posted online shows some of the community resistance to bauxite mining on Nendo.

The short clip, shot on a phone, shows a group of primary school students and adults in the village of Noipe on Nendo blocking the road and not allowing a Pacific Bauxite vehicle to pass.

Mark Gwynne, the executive director of Pacific Bauxite, tells the group – most of the children are holding signs in protest – the company is engaged in “good, ethical mining”.

“There is good mining, and there is bad mining, and I have witnessed a lot of bad mining,” he says. “We work really hard with communities. We reach agreements with communities for good mining. We do everything we can to protect the land, the villages, the people. We provide education for the children, we provide training for the adults for working. Can I show you some photos?”

He is told by one man from the village:

“Excuse me. We don’t need photos.

“Just stop everything. We don’t need mining and we don’t need prospecting. That’s all. The land is our heritage and our future for young generations.”

The standoff ends politely and without incident.

Brett Smith, the director of Pacific Bauxite, told the Guardian that at this stage the company had only completed reconnaissance prospecting and that no landowners were compelled to allow mining.

The Solomon Islands. Mining has a damaged reputation in Nendo after logging and mining on Rennell Island, on the south-western edge of the Solomons archipelago. Photograph: Alamy Stock Photo

“The results from this are highly encouraging and warrant further work to determine the potential for mineable resources,” he said.

“We are hoping that the bauxite deposits at Nendo provide the potential for a long-term industry that will result in the generation of beneficial sustainable businesses for the people of the Temotu province.”

Smith said Pacific Bauxite had a strong commitment to the environment and the community on Nendo, in particular around health, education and future sustainable economic development.

“To date, the company has provided much needed medical equipment to the Lata hospital and donated equipment to several schools. This community support will continue while the company is working at Nendo.

“The company also has a policy of providing employment opportunities for the local community. Expatriate workers are kept to a minimum to allow maximum benefit and training to local people. In the event that mining takes place in the future, the company intends constructing a training facility to Australian standards. That will have the capacity to provide skilled employees from the local community.”

Smith said mining on Nendo would have the smallest possible footprint and minimise the environmental impact.

“Rehabilitation will focus on returning a large majority of affected land to its former condition, while small areas will be considered for future beneficial businesses which will be fully owned by the local community.”

He said the company was being discredited by a small group that had misinformed the community.

Solomon Islands’ director of mines, Thomas Toba, said officials from his department considered several objections to mining on Nendo before granting the prospecting licence. Department officials have travelled to Nendo to speak to concerned landowners.

Toba recently launched the Solomon Islands’ new national minerals policy, which established a legal framework for minerals extraction, something the country had not had previously.

“Another thing is people will realise that resource owners have a part to play in this; they have a voice in this industry compared to the past when they can only participate through signing of surface access agreements,” he said.

While some landowners say they are resolutely opposed to mining, others argue it will bring development to the most remote region of the Solomons archipelago, often overlooked by the central government in Honiara.

Father Brown Beu, a former provincial premier, said that Pacific Bauxite prospecting would bring educational and health facilities to the province.

“We trust this company,” Father Beu told a radio interview. “Unlike other investors who are invested in Temotu province, the AU Mining[50% owned by Pacific Bauxite] will shortly after this be able to provide medical facilities that we will never – I don’t know, for centuries to come – never have.”

But the penultimate premier of Temotu province, Nelson Omar, who was overthrown in March, believes he was ousted because of his resistance to business licences for miners and loggers in Nendo.

Omar’s government had refused to grant a business licence to Pacific Bauxite. In March he was defeated in a sudden vote of no confidence. Within a week, a business licence was granted by the new government to Pacific Bauxite.

Omar said he warned the Temotu assembly that his refusal to grant the licence – and another logging licence to an unrelated company – were the bases for efforts to remove him.

“In fact it did happen. Days after the closure of the assembly, the licence was granted in an urgent executive meeting, exactly as I predicted,” he said. “The consent from the resource owners, the landowners, how it was conducted, was not done in accordance with existing legislations which govern the mining and logging acts.”

A traditional ceremony in Nendo. The great majority of locals do not want the mine, says former governor general Father Sir John Ini Lapli. Photograph: Alamy Stock Photo

The former Solomon Islands governor general, Father Sir John Ini Lapli, said the possibility of mining had divided families and tribes.

“The great majority of people do not want this,” he told Radio New Zealand. “Just the few that … are working with [the miner]. And there is a real possibility for clashes between the landowners, tribal groups, even relatives themselves if the government is not clear cut about how to deal with this.”

Lapli said the people of Temotu felt their wishes had been ignored in the central government’s decision to issue a prospecting licence. He said the land belonged to the people, not the government.

“They came with some agent unknown, they didn’t come through the procedure, and so they were able to pay some people to sign accepting this proposal they signed up and that is how they locked [in] these landowners.”

Mining has a damaged reputation in Nendo after logging and mining on Rennell Island, on the south-western edge of the Solomons archipelago.

The mining, by Bintan Mining, was initially undertaken with an illegally granted mining licence and has left the island with widespread environmental damage and little development. A video, Ripples in Rennells, by the environmental advocacy organisation OceansWatch has been played widely across Nendo.

Pacific Bauxite was formerly Iron Mountain. Pacific Bauxite bought a 50% stake in AU Capital Mining, which was the original holder of the prospecting licence from the Solomon Islands Mines and Minerals Board.

Pacific Bauxite’s website says of the Nendo project:

“The company is extensively engaged with the local community and is ensuring that all stakeholders are made fully aware of current and future activities regarding the project. To this end, meetings held with local parties to date have been extremely positive and much enthusiasm has been generated by the recent phase of exploration.”

It says the company’s initial auger drilling and pit sampling had confirmed “extensive large-scale bauxite deposits” on the island.

The main area earmarked for mining is approximately 12km by 2km (24 square kilometres) but that is expected to grow.

“Identified areas of mineralisation are significantly larger than historically defined,” the company said.

Bauxite is the principal ore in aluminium and is also used to make refractory materials, chemicals and cements. Australia is the world’s largest producer of bauxite.

Bauxite deposits are found in tropical and subtropical areas, in deeply weathered volcanic rock, which make up many islands in the Solomon Islands archipelago.

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Filed under Corruption, Environmental impact, Exploration, Human rights, Solomon Islands

Solomons group plans legal action over Temotu mining

Radio New Zealand | 3 July, 2017

A Solomon Islands conservation group says it’s planning legal action against the government over mining plans in the remote Temotu province.

An Australian company, Pacific Bauxite, secured a licence to prospect Santa Cruz island, and it claimed it had the consent of several landowner groups.

But the Temotu Conservation and Sustainable Development Association said those groups didn’t realise the implications of what might happen, and many were now trying to withdraw their consent.

The Association’s chair, Father Charles Melinga, said the provincial and national governments had done nothing to address their concerns.

He said the groups believed the law was not followed when the prospecting licence was granted, and they were hoping to challenge it in court.

Father Melinga said he hoped the process could begin soon.

“As far as mining is concerned at the moment, the population is in suspense as to what will happen next. So we call on the provincial government and the other related authorities to be clear on what is going to happen.”

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Filed under Exploration, Solomon Islands