Category Archives: Mine construction

K1bn needed for Solwara 1

Cedric Patjole | PNG Loop | October 14, 2017

More than K1 billion in remaining project financing is needed to fund the Solwara 1 Project in New Ireland Province.

Nautilus Minerals Inc. revealed this when announcing the appointment of its exclusive financial advisor – Deep Sea Mining Finance Ltd (DSMF).

In a statement, the Canadian company indicated that a remaining project financing of US$350 million was needed, which DSMF will be leveraging, to complete the build and deployment of the sea oor production system to be utilised at the Solwara 1 Project.

Nautilus said DSMF will seek to leverage the international expertise and financial relationships of Nautilus’ two major shareholders to assist in advancing the development of the project.

Nautilus has stated that there are no assurances that it will secure the necessary additional funding and a failure to do so may result in it undergoing various transactions, which include asset sales, joint ventures and capital restructurings.

DSMF is a newly-incorporated private company in the British Virgin Islands.

Nautilus has also announced that it has terminated a ‘Bridge Financing Agreement’ signed in 2016 with Metalloinvest Holding (Cyprus) Limited and Mawarid Offshore Mining Ltd.


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Aussie investor talks slow over Bougainville mine relaunch

 Ewen Hosie | Australian Mining | October 9, 2017

Talks between Australian investors and the Papua New Guinean and Bougainville governments over plans to reopen the Panguna copper mine in the Autonomous Region of Bougainville have slowed.

The mine has been closed since 1989 due to conflicts in the region.

Local operator Bougainville Copper (BCL) recently contributed to a tax and revenue summit in the region’s capital Buka, where it conducted a feasibility study for a relaunch of the once-thriving Panguna copper mine, which, while non-operational, was owned by Rio Tinto until divestment last year.

Lawyer and mining industry expert Renzie Duncan — currently advising Bougainville officials on mining rights and creator of an Australian investor consortium for the region — is banned from entering PNG until 2024 due to a request filed by the Bougainville Government, which wishes for operation of the mine to remain local.

Gold and copper company RTG Mining and billionaire private management fund owner Richard Hains are among the investors currently involved with the Australian consortium, which pays stipends to local landowners

The relaunch has been cited as a crucial financial key to the small region’s plans for independence from Papua New Guinea, which is planned to go to a public vote in 2019.

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Nautilus: We still need to raise K1 billion to fund Solwara 1 preparations

Nautilus says it needs to raise approximately US$41 million before the end of 2017, and an additional US$270 million in order to complete the build and deployment of the seafloor production system for Solwara 1

Resignation of Mark P. M. Horn as a Director

Nautilus Minerals Inc | October 5, 2017

Nautilus Minerals Inc. announces that Mark P. M. Horn has resigned as a director of Nautilus. 

Mark P. M. Horn has advised the Company that he will lead Deep Sea Mining Finance Ltd. (“DSMF”), a recently formed joint-venture between the two major shareholders of Nautilus, Metalloinvest Holding (Cyprus) Limited (“Metalloinvest”) and MB Holding Company LLC (“MB Holding”).

DSMF and Nautilus are in discussions concerning the potential engagement of DSMF as Nautilus’ financial advisor to implement a financing strategy for Nautilus, by leveraging the international expertise and financial relationships of Nautilus’ two major shareholders. Russell Debney, a director of Nautilus who is independent of each of DSMF, Metalloinvest and MB Holding, is negotiating or directing the negotiation of any such transaction on behalf of Nautilus.

Nautilus needs to raise approximately US$41 million before the end of 2017, and an additional approximately US$270 million is required in order to complete the build and deployment of the seafloor production system to be utilized at the Solwara 1 Project by the Company and its joint venture partner (as to 15%), the Independent State of Papua New Guinea’s nominee, in early 2019.

Mark P. M. Horn stated on behalf of DSMF: “Nautilus is a world leader in seafloor mining technology. This is a very exciting time in the mining industry, as deep-sea mining is on the verge of becoming a reality. Nautilus’ two largest shareholders are very pleased to be playing an important part in the development of this new industry.”

The Company is currently seeking the appointment of a new independent director and is in active discussions with various candidates.

About Mark Horn, MB Holding and Metalloinvest

Mark P. M. Horn has represented Metalloinvest on the Board of Nautilus since September 2013. Since 1987, he has worked as an international Fund Manager, Financial Analyst and Corporate Financier. Mark started his career at the Co-operative Insurance Society, then moved to Globe Investment Trust, before joining Rockefeller and Co. He subsequently worked for Kleinwort Benson Investment Management, before becoming Head of Research at Canaccord Capital (Europe). He holds an ALM, (Harvard University, USA); BA, BA (Hons) (First Class), MA, (Rhodes University, South Africa); BSc, BSc (Hons) (Geosciences), B.Eng (Hons), (Open University, UK); LLB (Hons), LLM, MBA (Banking) (London University, UK); Dip.B.Admin (Manchester Business School, UK). He has been called to the Bar of England and Wales as a Barrister of the Honourable Society of Lincoln’s Inn.

Mawarid Mining LLC of Oman (“MML”) holds 29.3% of the current outstanding shares of Nautilus through MML’s wholly owned subsidiary Mawarid Offshore Mining Limited (“MOML”). MML is a wholly owned mining and mineral business vertical of MB Holding and is actively engaged in exploration and development of concessions in the Sultanate of Oman, Saudi Arabia, Namibia, Tanzania and Rwanda. MB Holding is a multinational corporation with operations spread across the globe in the Middle East, Europe, Africa, Asia, Asia-Pacific. The dynamic group which started operations in 1982 has diversified businesses including integrated drilling & oilfield services, exploration & production of oil & gas, marine, manufacturing & engineering services, mineral & mining and investments. MB Holding employs more than 4,000 employees from over 54 nationalities who are committed to achieving its vision and mission.

Metalloinvest currently has a 18.5% interest in Nautilus. Metalloinvest is wholly owned by USM Holdings (“USM”), a diversified international holding company with significant interests across the metals and mining, telecoms and internet sectors. The main shareholders of USM are Alisher Usmanov, Vladimir Skoch and Farhad Moshiri. USM’s assets include Metalloinvest, the largest mining company in Russia and the CIS and the leading global manufacturer of hot briquetted iron, Baikal Mining Company, which owns the largest copper reserves in Russia, MegaFon, a major telecommunications operator in Russia, and Mail.Ru Group, the Russian internet leader and owner of the country’s most popular social networks VKontakte and Odnoklassniki. The group is also a prominent global investor in the digital space and is a major investor in one of the key players in the global esports market. Furthermore, it manages a number of other industry-leading businesses including UTH Russia, one of the country’s largest media and entertainment groups with a unique portfolio of popular national TV channels in Russia and Kazakhstan and one of the leading Russian property development company.

All information in this news release concerning Mark P. M. Horn, MB Holding and Metalloinvest has been provided by each of those respective parties.

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Panguna work to cost K18.8 billion

Mine could not open before 2025/26 even if locals agreed

The National aka The Loggers Times | October 4, 2017

CONSTRUCTION of the Panguna mine is estimated to cost US$4-6 billion (K12.5- K18.8 billion).

Bougainville Copper Ltd (BCL) secretary Mark Hitchcock said significant tax revenue would be generated in the estimated 25-plus years’ mine life, with operations starting around 2025-26.

Hitchcock spoke during the Autonomous Bougainville Government’s (ABG) three-day tax and revenue summit in Buka last week aimed at finding ways to improve the financial outlook for the region and the government’s ability to fund services for its people.

Hitchcock was invited to present development of a new Panguna mining project, including its potential revenue and broader economic benefits.

Once developed, the mine would generate significant tax revenue over the 25-plus years operational life of the project.

The presentation was drawn from an order of magnitude study which was updated late last year.

A realistic timeline for the Panguna project will see the mine operational around 2025-26, Hitchcock said, and the potential tax revenue gains had to be viewed as a longer term prospect with no short-term, direct tax generation, although the project’s development and construction period would present income generation opportunities.

Hitchcock highlighted the need for certainty in relation to the tax regime that would apply to the project and warned that excessive tax imposts would undermine its viability.

“One potential pathway is for the ABG and PNG national government to work towards a joint agreement to provide assurances regarding applicable taxes that would apply over the longterm,” Hitchcock said.

In addition to tax revenue, he said the Panguna project would have a wider multiplier effect in terms of economic benefit.

“A project of this scale will help stimulate the economy in a multitude of ways in areas such as training and employment, new business opportunities in the supply of goods and services and the provision of new infrastructure to name a few,” he said.

Hitchcock congratulated the ABG for holding the tax and revenue summit and said BCL welcomed opportunities to contribute to important policy discussions in Bougainville.

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Tolukuma future looks bleak, despite MRA spin

It is now two years since the government sold the Tolukuma mine to a Singapore based speculator. Despite repeated false promises from MRA, the prospects for the resumption of mining look as bleak as ever, with no confirmed funding in place!

Tolukuma To Restart Operations
Post Courier | October 3, 2017
The State anticipates mine restart at Tolukuma, Central province, by the year’s end, says Mineral Resources Authority (MRA) managing director Philip Samar.
However, this will depend on how soon Singaporean developer Asidokona Mining Resources PTE, sorts out the regulatory requirements especially those pertaining to its preparations for it to return to mining.
Mr Samar was responding to queries by the Post-Courier on a situation update at this mine.
Production was planned for the month of July announced by Tolukuma Gold Mine executive director Vincent Siow in June this year during the signing of the revised memorandum of agreement (MOA) for the project.
However, its plans had to be shelved when its major partner decided to withdraw its investment.
Tolukuma Gold Mine (TGM) executive director Vincent Siow in August, had advised that Asidokona managed to convince US Funds, which he said were familiar with the mining industry in PNG to join the venture.
“MRA is aware that the developer is doing tests to fulfill that requirement. It is for them to meet those conditions and to come back to us. Failing that some decision will have to make as to what then happens.
“There are some things that we can do to assist. We want to be proactive and in doing so work with them so that they can meet those conditions,” the managing director said.
Meanwhile, Mr Samar confirmed that landowners of Tolukuma have already signed off on the revised MOA for the project.

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Japan Starts Mining Hydrothermal Deposits

Subsea News | 28 September, 2017

Japan has carried out the world’s first mining and lift test of hydrothermal deposits at about 1,600 meters depth in the ocean near Okinawa, the country’s Ministry of Economy, Trade and Industry and the Japan Oil, Gas and Metals National Corporation (JOGMEC) confirmed earlier this week.

The success of this test, which reportedly extracted zinc and other metals, should be a major step toward establishing the technologies required for ocean mineral resource development.

In addition to the results of this test, Japan plans to carry out economic evaluation such as resource amount assessment and environmental survey. According to the Ministry, the first test confirmed that there is no serious influence on the surrounding environment.

“We are planning to comprehensively promote efforts towards commercialization of submarine hydrothermal deposits by promoting economic evaluation and environmental investigation,” the Ministry said in a statement.

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Redevelopment plan for new Panguna mine project underway

Abandoned BCL bus

The National aka The Loggers Times | September 21, 2017

THE Bougainville Copper Limited (BCL) is working to implement its staged redevelopment plan for a new Panguna mining project and further build community support.

“We are actively building positive relationships and will continue to increase our presence in Central Bougainville over the coming months as we expand our community engagement activities,” said Executive Manager Justin Rogers.

Rogers led a BCL community engagement team with Buka-based Bougainville Manager Ephraim Eminoni and two senior project officers where they spent four days at Arawa, Central Bougainville.

The team met local stakeholders earlier this month which coincided with the opening of two major events – the national boxing championships and the 2017 Bougainville Chocolate Festival.

In addressing the opening ceremony, Rogers said;

“It was a chance for us to acknowledge the important parts played by the cocoa industry and the sport of boxing in terms of fostering economic development in Bougainville and the development of people more broadly.”

“Boxing provides opportunities for Bougainvilleans to not only train and compete at the local level, but to shine on the world stage, with no better example than young champion Thaddeus Katoa.”

Rogers said Bougainville’s cocoa industry looked to have a very bright future and had earned international recognition for the quality of its produce.

BCL considered the development of primary industries and other areas of potential, such as tourism, as critical to Bougainville’s future economic success, of which employment was fundamental.

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