Category Archives: Financial returns

Landowners ordered to stay away from LNG project site

Charred machinery at the PD8 LPG development site in Hela province, PNG Highlands. June 2018. Image: Michael Passingan/PNG News.

The National aka The Loggers Times | May 15, 2019

THE National Court has issued a restraining order to landowners of Angore in Hela to stay away from the ExxonMobil’s project site.

Justice Derek Hartshorn issued the restraining order to Mango Kurali, a local from Angore PDL 8 area, his agents, tribesmen, relatives and supporters after finding that he and his associates participated in causing damage to ExxonMobil properties on Nov 15, 2017, May 29, 2018, and June 7, 2019.

“The evidence is unchallenged,” Justice Hartshorn said.

The court found that Kurali and his accomplices not only damaged properties, but also participated in setting up roadblocks, issuing threats and intimidating employees and contractors. This caused ExxonMobil to cease operations from time to time.

“ExxonMobil has rights,” Justice Hartshorn said. “PDL 8 itself grants ExxonMobil service rights to fulfil its obligations and construction to work and upgrade its existing gas lines under its licence.

“I am satisfied that the defendant had no right to destroy the properties and intimidate ExxonMobil contractors or prevent ExxonMobil’s operations in PDL 8.

“The actions by the defendants are against the law, and if not restrained by this court, he will continue to do what he did.”

The court held that ExxonMobil suffered damage estimated at millions of kina in its properties and it was not practical for ExxonMobil to compensate anybody.

In another case concerning damage to ExxonMobil’s properties in PDL8 as well, Justice Hartshorn issued restraining orders to Steven Au and David Hayebe.

They were charged with damaging properties, creating roadblocks and threatening employees.


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Wafi Golpu SML Grant In June, Highly Unlikely

Frankiy Kapin | Post Courier | May 14, 2019

Wafi-Golpu Joint Venture is unlikely to be granted a special mining lease (SML) by end of June. This timeline was agreed to by the WGJV mine developer and the PNG Government.

WGJV head of external a airs David Wissink said recent developments in PNG render the possibility of a SML being granted by 30 June not viable. Mr Wissink said this as a main hindrance to the developer achieving set goals that contribute to the achievement of the project.

Wissink said WGJV is aware of the recent issuance of a stay order in the matter of Morobe Governor Ginson Saonu and others against Minister for Mining and others.

“The matter is a judicial review application made by the Governor concerning the actions of the Minister for Mining in regard to the execution of the Memorandum of Understanding entered into between the developers of the Wafi-Golpu project and the State of Papua New Guinea.

“The WGJV hopes that this matter is resolved soon, and stands ready to continue to participate constructively in all negotiations to take the project forward when it is appropriate to do so.”

Mr Wissink added that WGJV has been working constructively with the PNG Government; the Morobe provincial government; and the landowners to take forward the negotiation of various agreements necessary for the permitting of the project.

In relation to progressive proceedings including reaching the Memorandum of Agreement (MOA) by parties to the Wafi-Golpu project, Mr Wissink said the MOA is one of a number of agreements necessary to be finalized to enable the permitting of the project.

“The Mineral Resources Authority has convened a development forum, and is collecting position papers from all identified stakeholders.

The Morobe provincial government is an important participant in this process and we are very pleased that it has recently submitted its position paper,” Mr Wissink said. He said the WGJV is yet to be given a copy of the MPG position paper and looks forward to going through the paper at an appropriate time to progress the project.

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Taking the Initiative – Engan man builds home made Gold Crusher

Vasinatta Yama | EMTV News | 13 May 2019

Joe Tomerop from the Enga province is an Alluvial Gold miner who has taken the bold steps in increasing mining production in his area.

Almost two years in the making, Tomerop has completed his own home-made gold crusher and is having it ready for transportation to the Kompiam district for an alluvial mine at his village.

Costing a Million Kina he says, he was challenged by the Mineral Resources Authority to have the mining capacity available before acquiring a mining license for the alluvial deposits in his mothers village in the province.

Tomerop who is a local business man says he used his own resources to build the machines proving that local Papua New Guineans have the capacity to do mining and export, and have the licenses to do so.

“I want MRA and Papua New Guinea sees that Papua New Guineans we can do it. That’s the difference. So we have completed it and I’m waiting for my license.”

An alluvial miner, in 2014, he discovered alluvial gold in his mother’s area, who’s landowners are the Kuralin tribe of Kompiam.

With agreements from his uncles, he took the initiative and brought the Warden Hearing to Kompiam.

“From that time on we followed MRA’s procedures and surveyed the area and gather landowners. We are nine clans from the Kuralin Tribe from that mountain. So we tried doing it and brought the Warden’s hearing and the Warden gave okay for us.”

The crusher he’s designed is built using local knowledge, and utilized the help of an Australian friend who guided the locals to complete building the gold crusher.

“It’s for alluvial gold. We did not bring it from China, Europe or Australia. This machine is locally built.  Few things like pipes and pumps are not in PNG so we brought it from Australia.”

According to Mineral Resources Authority, panning for alluvial gold mine can bring an estimated K300 million into the PNG economy, and Tomerop believes that with his crusher and machines, he can triple his own revenue as a result.

“But I don’t think a National has come to that capacity of what I had in mind. Because it’s hard to invest money in something you don’t know whether there’s something under the ground or not. You know that coffee season is good, the soil is good, and then you plant coffee because you know the market is there. This one has market but to start it is difficult so I took a gamble.”

Tomerop is now waiting for MRA to grant him and his tribesman their license to operate the alluvial mine.

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Morobe’s Interest In Wafi-Golpu Legal, Says Judge

Frankiy Kapin | Post Courier | May 13, 2019

A ruling of the national court in Lae affirms that Morobe Governor Ginson Saonu (plaintiff /applicant) is a party of interest to the Wafi-Golpu project as host province.

Acting Judge John Numapo granted leave for judicial review to the signing of the Wafi-Golpu memorandum of understanding (MoU) between the State and the developer without the host province’s governor.

Justice Numapo ordered a directional hearing set for May 24, followed by a pre-hearing conference on June 6 to set a date for a full hearing of the substantive matter.

Justice Numapo ruled that Mr Saonu, in his capacity as mandated representative of Morobe Province and its people, is granted the review on two decisions pertaining to the letter constituting the legal clearance issued by state solicitor Daniel Rolpagarea (second defendant) on December 10, 2018, for the execution of the MoU between Mr Saonu, Wafi Mining Limited and Newcrest PNG 2 Limited.

The second decision for the review, as set in the originating summons, pertains to the MoU signed on December 11, 2018, between Mining Minister Johnson Tuke (first defendant) and developers Wafi Mining Limited (fourth defendant) and Newcrest PNG 2 Limited (fifth defendant).

The independent State of Papua New Guinea is the third defendant in the originating summons (OS-JR No 18 of 2019).

Justice Numapo ruled that Mr Saonu, as duly-elected Morobe Governor, has sufficient interest in the Wafi-Golpu project located in his province, therefore has standing (locus standi) seeking review through submission of the proceedings.

“One of his responsibilities is to make sure that the province generates and raises sufficient revenue from various sources within the province to maintain government services and one such revenue source is from the mining activities carried out in the province such has the Wafi-Golpu mine,” Justice Numapo said.

He said the plaintiff has taken into consideration the potential of the mine changing the economic outlook of the province and the country once operational and wants to make sure the province is well-positioned to benefit through revenue generation, employment opportunities and other spin off benefits.

Justice Numapo said the province is mindful of the environmental impact and other social issues that may arise as a direct result of the mining project and wants to ensure these concerns are properly addressed.

“I am satisfied, therefore, that a prima facie (accepted as correct until proven otherwise) case on sufficient interest has been made out in favor of granting leave for review.,” he said.

“I am satisfied that the plaintiff has sufficient interest in the matter and therefore, has the locus standi to bring this proceedings seeking leave for judicial review.”

Justice Numapo also ruled for the review after being satisfied that the Mining Minister Tuke and the state solicitor, as holders of public offices, acted in respective capacities constituting a decision or act in clearing the MoU signing through discharge of their statutory duties.

Justice Numapo granted the plaintiff, Mr Saonu, leave on May 7 to seek a judicial review of the agreement.

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Proposed Wafi-Golpu Mine On Hold

MOU was signed  “when the constitutional process had not been fully exhausted and, therefore, not only premature but also a clear breach of the Mining Act and the Constitution”.

Jimmy Kalebe | The National aka The Loggers Times | May 10, 2019

A COURT has put on hold operations of the K9 billion Wafi-Golpu copper-gold mining project in Morobe pending a review of a deal signed between the Government and developers.

Morobe Governor Ginson Saonu took the matter to court challenging the legality of the signing of the memorandum of understanding last December between the Government and Newcrest Mining Limited and Harmony Gold.

Saonu on behalf of the Morobe government claimed that the signing of the memorandum was done without proper consultation with, and input from, the provincial government and other stakeholders.

The memorandum was signed on Dec 11 following a clearance letter from State Solicitor Daniel Rolpagarea.

National Court acting judge Justice John Numapo ruled that the stay order also applied to any representation by Saonu or the parties who signed the memorandum regarding the project, including any meetings or consultations.

Saonu and the provincial government had asked the court to review the letter constituting the legal clearance issued by Rolpagarea for the execution of the memorandum.

Lawyer Paul Mawa, representing the State, asked the court to refuse the leave for review because the application was premature, misconceived and defective.

He argued that it was not supported by any clear and tangible evidence.

He said the legal clearance purportedly issued by Rolpagarea was not the decision of a public body or authority and therefore could not be reviewed.

But Justice Numapo stated that Rolpagarea was public office holder and what he did fell under a public body or authority which was subjected to review.

Justice Numapo dismissed the claims by Mawa and ruled that the issues raised by the plaintiffs were prima facie as they contained substantive issues of law.

He said the issuing of the letter to clear the memorandum for signing was done when the constitutional process had not been fully exhausted and, therefore, not only premature but also a clear breach of the Mining Act and the Constitution.

He said the second issue related to the terms of the memorandum was that the Morobe government wanted to benefit fully from the project.
Saonu and the Morobe government had wanted half of the 30 per cent State equity to be awarded to the Morobe government. Justice Numapo said this was not accommodated in the memorandum.

He also highlighted the fourth goal of the national goals and directive principles enshrined in the Constitution which called for collective benefits and equal distribution of natural resources and environment for all citizens.

The case will return for a directions hearing on May 24 at the National Court in Lae.

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PM Labels Solwara Venture As A Wasted Investment

Post Courier | May 8, 2019

In yesterday’s heated exchange of words and debate in Parliament, Prime Minister Peter O’Neill labeled the now considered sunk Solwara 1 project for deep sea mining as a wasted venture that government was haste in investing in.

The PM made reference to this when questioned by the shadow treasurer for the Opposition and Kavieng MP, Mr Ian Ling Stucky on the estimated K400 million investment in the State’s stake in the project by Nautilus Minerals Inc.

Mr O’Neill was quick to blame the investment decision on the former Somare Government, which signed into the deal initially at 30 per cent.

The State eventually took on a 15 per cent stake in 2014, which the PM described was the only component that kept, what was touted to be a world’s first full scale project using deep sea mining, afloat till its recent financial upheavals over the past few years leading to its delisting from the Toronto Stock Exchange last month.

“In the case of Solwara (1), again this investment was done during the Somare government; it was not an investment during our government.

“It was not an investment that our government made. We have lost a lot of money because of stupidity and hundreds of millions of kina.

“We were buying ahead of all the shareholders. We were underwriting the project itself. A deal that should not have happened, and as a result it has cost us a lot of money,” the prime minister said.

Mining Minister Johnson Tuke said last month the company had been given sometime to prove it can source funds or will have its license revoked.

This is after Toronto-based underwater mineral exploration company was unsuccessful to appeal the initial decision by TSX to delist its shares as a result Nautilus’s common shares has been suspended from trading on TSX.

“As long Nautilus is compliant to our conditions of Mineral Resources Authority (MRA) then MRA does not have the right to underwrite their licence only until such a time when they are not compliant to the conditions of the licence.

MRA on the other hand stated earlier that once the agreed schedules set under the licence have been breached it will take on the necessary actions needed if it is deemed to have breached those agreements.

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New Solomon Islands govt prioritises mining reforms

MV Solomon Trader oil spill on Rennell Island, Solomon Islands. Feb. 2019. Photo: The Australian High Commission Solomon Islands

Radio New Zealand | 8 May 2019 

Solomon Islands prime minister Manasseh Sogavare says his new government is prioritising productive sector reforms including new mining legislation.

Mr Sogavare told the Solomon Star the decision was taken in light of the country having recently been caught in a very awkward situation over mining issues.

Earlier this year a cargo ship ran aground on a reef off of Rennell while trying to load bauxite from a mine on the island.

It eventually spilled hundreds of tonnes of heavy fuel oil into the ocean causing one of the worst man made disasters in Solomon Islands in recent times.

The whole saga has revealed inadequacies in Solomon Islands mining law when it comes to holding mining companies accountable for environmental disasters caused by their operations.

In the Rennell case, the mining company Bintan Mining continues to deny liability for the spill and has said it would be suing the ship’s owner.

Manasseh Sogavare said his government is committed to delivering new legislation for the mining sector as part of a larger aim to build a broad-based and environmentally sustainable economy.

Mr Sogavare said he hopes the new law will create a robust and conducive local mining sector that can attract good investors.

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Filed under Environmental impact, Financial returns, Solomon Islands