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Bougainville govt’s mining deal meets widespread opposition

Local residents hold banners and placards during a 2018 protest at the former Bougainville Copper Limited’s Panguna mine. | Photo: Reuters

Radio New Zealand | 8 February 2019 

There’s been community outrage in Papua New Guinea’s Bougainville region at the local government’s new mining plan.

The autonomous government of Bougainville is planning to re-open the long shut Panguna copper mine and operate it with a company majority owned by Bougainville.

It is expected to pass amendments to the Mining Act to accommodate the Australian investor who will jointly own Bougainville Advance Mining.

Johnny Blades has been following the reaction to this development in Bougainville.

JOHNNY BLADES: The plan comes after squabbling over who should get the licence for the Panguna mine, which of course has been mothballed for a long time.  There’s been a government moratorium on any Panguna development because it’s all so sensitive around this impending the referendum on independence coming up this year. But the Bougainville President John Momis has described this deal with the Australian investor as the best deal for landowners, also saying that existing companies already mining in Bougainville would not be affected by this new deal. But this company, Caballus Mining, owned by West Australian businessman Jeff McGlinn, has no public profile to speak of in the industry.

DG: So the president of the autonomous Bougainville government, John Momis, he earlier told RNZ Pacific that PNG’s central government is not stumping up with funding for the independence referendum, and they in turn have been on the urgent look-out for funds. Is he just turning to this investor or this deal to fund the referendum?

JB: He seems to be saying that, that this is something they have to take up because of this urgent need for money. But one of the principal landowner groups in this area, the Osikaiyang Landowners Association has said that Caballus has no assets but is demanding a monopoly on all major large scale mining projects in Bougainville. There are questions over the viability of finance for these mining plans. They suspect this is a con job, that Momis and his government are being taken for a ride here. Lawrence Daveona, one of the association’s people, he said some of the ex-combatants on Bougainville had met with this investor Jeff McGlinn and asked him ‘are you able to give the government money?’ and he reportedly said to them no, he has no money. So it seems a bit fanciful to think that the investor or this deal might fund the referendum.

DG: There was a public forum to dicscuss this issue in Arawa. What was the general feedback?

JB: The community is upset that local parliamentarians seem to be rushing changes to the Mining Act through without proper public consultation. They says that you have to have proper public consultation before any social license is granted, so to speak. There’s a group called the Bougainville Hardliners Group. They have warned that sort of foreign control of mining on Bougainville is what caused the island’s civil war in the first place. So they and others are certainly opposed to diving headlong into this deal as Monmis and his government seem to be doing.

DG: Historically of course, Bougainville Copper Limited has been behind the scenes of the Panguna mine, What’s been their reaction to this?

JB: Unsurprisingly, BCL have come out very strongly against this deal. They’ve got their own agenda to push, of course. Let’s not forget that the moratorium on mining at Panguna was centrally because landowners oppose the return of BCL. But in this case, both landowners and community groups appear to agree with BCL that this deal seems to be risky. There are constitutional and ethical questions around it. And more widely, these bills are being interpreted as both anti-competitive and anti-investment which BCL and others are saying is the last thing Bougainville needs.

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Bougainville mining plan meets with outrage

An abandoned building at Panguna mine site in Bougainville

Radio New Zealand | February 5, 2019

Landowners near the Panguna mine in Papua New Guinea’s Bougainville region have voiced outrage at the local government’s new mining plan.

The autonomous government of Bougainville is planning to re-open the long shut Panguna copper mine and operate it with a company majority owned by Bougainville.

It is expected to pass amendments to the Mining Act to accommodate the Australian investor who will jointly own Bougainville Advance Mining.

The plan comes after squabbling over who should get the licence for the Panguna mine, followed by a government moratorium on any Panguna development because it could undermine the referendum on independence from Papua New Guinea, planned for June of this year.

Describing the deal as the best for landowners, Bougainville President John Momis said existing companies already mining in Bougainville doing were “not affected by this new deal”.

He explained that with PNG’s central government failing to fund Bougainville ahead of the referendum, the government decided to take urgent action to find money.

Caballus Mining, owned by West Australian businessman Jeff McGlinn, has no public profile in the industry.

This is of concern to the Osikaiyang Landowners Association, whose chairman, Philip Miriori, raised questions over the viability of finance for Caballus’ plans.

“Caballus has no assets, and yet is demanding a monopoly on all major large scale mining projects in Bougainville.

“McGlinn is demanding an initial 40% percent interest, which will increase further over time, without any upfront cash and only a shallow promise of future money if he is granted those rights first.

“This is just a con job,” Mr Miriori said, adding that Mr McGlinn’s track record with indigenous people, and stand on customary rights, made him ill-equipped to gain a social license for his Bougainville plans.

Public disapproval

The new plan has thrown a cat amongst the pigeons in Bougainville public discourse in this important year.

A public forum to discuss the issue washeld in Arawa on Sunday highlighted general community outrage over a move to change Bougainville’s laws in order to expedite the new mining development.

The Bougainville Advance Mining Holdings Trust Authorisation Bill, the Bougainville Advance Mining Holdings Limited Authorisation Bill, and a Bill to amend the Bougainville Mining Act 2015, have all gone through first reading.

At the forum, the Chairman of the Bougainville Hardliners Group which is opposed to any form of large scale mining, called on the Bougainville government and general public to fund the referendum from their own pockets by donating twenty kina each meet referendum expenses.

“Lets show Papua New Guinea that we are independent by funding our referendum”, he said.

At the end of the meeting a resolution was passed to lobby to block the bills from being finally passed in by the government.

Former mine operator worried

In a statement, Bougainville Copper Limited said the new developments raised “very legitimate legal, constitutional and ethical questions”.

“Not only by BCL and its shareholders, but also by landowners in Bougainville and others in the community. More widely these bills could also be interpreted as both anti-competitive and anti-investment which is the last thing Bougainville needs.”

BCL ran Panguna until the outbreak of civil war in 1989 in which grievances caused by the mine were central to the 10 year conflict that cost over 20,000 lives

Mr Momis had placed an indefinite moratorium on mining at Panguna after landowners opposed the return of BCL.

The landowners said BCL would not take responsibility for the environmental and social impacts of its previous operation.

However BCL said the Bougainville Mining Act 2015 did not need to be modified.

“Bougainville introduced good laws and regulations in 2015 designed to rebalance Bougainville’s mineral rights after a long period of consultation with all stakeholders. Now those rights are being undermined in haste by these proposed changes. Any genuine investor worth its mettle should be able to work within the existing laws.”

The bills are to be further read by the local parliament on 12 February.

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Bougainville Copper faces yet another fight to reopen a big PNG mine

Boxer Anthony Mundine training ahead of his Nov 30 fight with Jeff Horn. Pic: Getty

Angela East | Stockhead | February 5, 2019

Bougainville Copper’s efforts to bring the past-producing Panguna mine back online is again in jeopardy over hasty moves by the Autonomous Bougainville government to make changes to the mining laws.

Last week three new bills were introduced to Parliament, including one that would allow a newly formed company to bypass current red tape and go straight to mining any land that is not subject to an existing exploration licence or mining lease.

The problem for Bougainville Copper (ASX:BOC) is that it has been fighting the government to get its exploration licence (EL) over the 1.5 billion tonne Panguna mine renewed.

The Autonomous Bougainville government previously rejected Bougainville Copper’s renewal application, but a court overturned the decision.

“That left us with an EL application still in process over Panguna, and that’s where we assert our rights that we still have an EL over Panguna,” company secretary Mark Hitchcock told Stockhead.

“For them to now be putting the bills forward for reading that purport to actually mining all over Bougainville certainly could have some impact on our rights at Panguna.”

Under the new laws, the newly formed Bougainville Advance Mining Limited would be granted a special mining licence without the company even having to seek landowner approval.

Consent from the traditional landowners is required for the issue of any exploration licence on their customary land, a process which has historically escalated to wide-scale political unrest on the island.

The region has long been known for its copper and gold prospects, but disputes between regional residents and explorers such as Bougainville Copper have marred production since the early 1970s.

Conflict between the Bougainville Revolutionary Army and Papua New Guinea Defence Force escalated to a civil war in 1988 and took almost 10 years to cease.

Now, the Autonomous Regional of Bougainville is seeking independence for its population of 250,000, with a target date of June 15, 2019 set for a referendum on the topic.

Locals don’t agree

Mr Hitchcock said there is strong public opinion against the government’s move to change the 2015 Mining Act.

“From what I’m reading, Bougainvilleans are becoming a bit distressed about just what it means and why [the government] spent so much time getting a really robust Mining Act put together and then in a very short time have some amendments come through that could strip away a lot of powers of the landowners and the people that actually own the resources,” he said.

It has been a long fight for Panguna for Bougainville Copper.

Back in 2014 the company was stripped of its mining licence and handed a two-year exploration licence instead.

Attempts to renew the licence after two years were delayed and Bougainville Copper came up against claims from fellow ASX-listed explorer RTG Mining (ASX:RTG) that it had the support of the landowners to start work on the Panguna mine.

“There is still a tussle going on there,” Mr Hitchcock said.

“RTG executives have bans on them from travelling to Bougainville. ABG has imposed them through the national government.

“It has been causing division and there are definitely different factions down there that are supporting them, but we believe we’ve got strong support from the landowners.”

The three new bills are due to be returned to Parliament on February 12 for further discussion.

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BCL crying foul over new Bougainville Mining Laws

PROPOSED MINING LAWS RAISE SERIOUS CONCERNS

Bougainville Copper Limited  | February 4, 2019

Bougainville Copper Limited (BCL) has serious concerns over proposed new mining laws that some members of the Autonomous Bougainville Government (ABG) seem keen to rush through parliament.

The three bills that were introduced to parliament last Wednesday, with insufficient stakeholder consultation, are proving divisive at a time when unity is required in the lead-up to the referendum.

If passed, one of the bills seeks to amend the Bougainville Mining Act 2015 to allow a new company, Bougainville Advance Mining Limited, to be issued with a special mining licence granting “large-scale mining leases over all land in Bougainville available for reconnaissance, exploration and mining that is not subject to an existing exploration licence or mining lease”. Leases of up to 100 years could be granted.

These bills mirror proposals put forward by an Australian opportunist Jeffery McGlinn, whose apparent primary business appears to be horse breeding. In presentations to MPs and others he has proposed a 40 per cent stake in Bougainville Advance Mining for his own newly formed company Caballus Mining with other unknown foreign investors and sovereign states.

These developments raise very legitimate legal, constitutional and ethical questions, not only by BCL and its shareholders, but also by landowners in Bougainville and others in the community. More widely these bills could also be interpreted as both anti-competitive and anti-investment which is the last thing Bougainville needs.

Bougainville introduced good laws and regulations in 2015 designed to rebalance Bougainville’s mineral rights after a long period of consultation with all stakeholders. Now those rights are being undermined in haste by these proposed changes. Any genuine investor worth its mettle should be able to work within the existing laws. The Bougainville Mining Act 2015 therefore does not need to be changed.

BCL urges ABG leaders to think very seriously about the unnecessary divisions being created by these proposed amendments to the Mining Act and instead re-focus on the important work of unifying landowners and Bougainvilleans at this critical time for Bougainville, as they prepare for the referendum.

From the company’s own perspective, these legislative moves also ignore current court proceedings and BCL’s rights to natural justice and they are also at odds with the ABG’s decision to place a moratorium over the Panguna project area. The ABG has maintained there should be no discussions regarding mining activities in Panguna until after the referendum.

In early 2018, the ABG advised of a decision not to grant BCL an extension of its exploration licence (EL1) over the Panguna project area.

BCL maintains that the application process was both legally and procedurally flawed and was also undermined by other parties with competing commercial interests in Panguna mineral rights.

To protect the interests of all those with a significant stake in our company, including the people of Bougainville, BCL commenced legal proceedings in the PNG National Court seeking a Judicial Review of the decision. We were subsequently granted leave by the court to seek the review.

Since being invited back to Bougainville in 2012 by the ABG to reengage about the prospect of redeveloping Panguna, BCL has always conducted itself in an ethical and respectful manner and we continue to support worthwhile community projects.

The ABG and PNG National Government remain major shareholders in the company and we retain strong support among customary landowners in the project area and others in the community. BCL also possesses valuable local knowledge, project IP and mining expertise.

We have a highly-regarded local board led by respected Bougainvillean Sir Melchior Togolo as well as strong connections within the global mining and investment communities where there are potential project partners.

For all these reasons BCL remains a viable option for future mineral development in Bougainville and in the best interests of all Bougainvilleans, we would urge all members of the ABG parliament to seriously consider this before the bills are further read on 12 February.

Community leaders, landowners and others who are concerned by these proposals also have an opportunity to ensure their voices are heard by decision-makers before these laws are passed.

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No end to landowner squabbling at Bougainville’s Panguna

Radio New Zealand | January 21, 2019

Landowners near the long-closed Panguna mine in the Papua New Guinea region of Bougainville continue to scrap over who the legitimate owner is.

Earlier this month the group, the Osikaiyang Landowners Association, announced it had achieved unity at its annual meeting in December.

Leader Philip Miriori said they now have a board representing seven villages in the Panguna area and have included youth and women members.

But the rival Panguna Developments Company said Osikaiyang doesn’t have the right to represent all the landowners and says it doesn’t have any status under the Bougainville Mining Act.

It also said Osikaiyang cannot claim to own the mineral rights at Panguna as its business associate, Australian mining company, RTG, claims on its web page.

The Panguna Developments Company has links to Bougainville Copper Ltd which is also endeavouring to return to mining at Panguna.

But a year ago, fearing the mine issue would undermine the independence referendum, the autonomous Bougainville government announced an indefinite moratorium on a possible return to mining there.

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RTG-led consortium meets Bougainville Gov’t over Panguna project

Australian Mining | September 12, 2018

ASX-listed RTG Mining has presented its redevelopment proposal for the Panguna mine to the House of Representatives in Bougainville in a significant step forward for the project.

RTG Mining is leading a consortium of local landowners in Bougainville, an autonomous region of Papua New Guinea (PNG), that is trying to win government support in order to restart operations at the mine, currently under consideration for redevelopment by Government-backed Bougainville Copper (BCL).

The mine’s relaunch is a keystone of Bougainville’s upcoming plans for independence.

The dormant Panguna copper mine, which has been abandoned since 1989 due to local conflicts, contributed roughly 40 per cent of PNG’s economy during the height of operation.

The consortium, led by landowners, presented its proposal last week to a number of representatives of the Bougainville Government and is currently developing a social licence to win further support.

This includes donations for the local Arawa hospital, school and education support, support for the Women’s Federation in Bougainville and sport sponsorship opportunities, including the local rugby sevens team, the Black Orchids.

“This gesture of support by RTG is significant towards our efforts to compliment our ABG Government including all stakeholders on Bougainville working towards a united and peaceful Bougainville,” said Peter Tsiamalili, Autonomous Bougainville Rugby president.

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The new battle for Bougainville’s Panguna mine

Rusting trucks at Panguna mine, Bougainville

Speculation about the future of the Panguna copper mine in Papua New Guinea’s autonomous region of Bougainville, which ignited a decade long civil war in the 1990s, peaked late last year when an application for exploration by former Rio Tinto subsidiary, Bougainville Copper Ltd (BCL), was put to a local vote.

Catherine Wilson | The Interpreter | 21 August 2018

The outcome revealed that the mine remains a contested site and that a new battle for its riches is deepening divisions among traditional landowning groups. Chris Baria, a Bougainville writer and commentator, who lived through what is known as the “Crisis”, explained the sentiment in a recent interview:

When those with mining interests meddle with Panguna, it makes people revisit the pain and suffering, and the horrors of war that the government wrought on its citizens for closing down a mine, which they felt had not compensated them enough for their loss.

The mine still stands in ruin. From the Morgan Junction checkpoint near the entrance, the drive is long and winding up into the white mist that often veils the peaks of the Crown Prince mountain range. In a valley at the top is the scene of a time warp: rusting mine machinery disintegrating into the all–consuming jungle, rows of silenced trucks and gutted housing blocks.

Locals amid the ruined mine buildings at Panguna (Photo: Catherine Wilson)

In 1989, the Nasioi on Bougainville were the world’s first indigenous people, angered by inequity and environmental damage, to shut down a multinational mining venture. But the feat came at a huge cost. The ensuing civil war, primarily between local rebel groups and the PNG Defence Force, decimated infrastructure and development and left 15,000–20,000 people dead, with many more suffering still from untreated trauma.

Yet debate about the mine’s possible revival has persisted for the last eight years. It’s the focus of the Bougainville autonomous government’s ambitions of fiscal self–reliance as an independence referendum approaches in June 2019; an enormous challenge for a region still occupied with post–conflict reconstruction and heavily dependent on aid. Last year, only 14% of the government’s expenditure, totalling K162 million ($67 million), was covered by internal revenues, while experts point out that an independent nation of Bougainville will need a budget two to three times greater.

This is a dilemma for many Panguna landowners. A few years ago, as I sat with villagers near the mine pit, no–one expressed a wish for mining to return to this beautiful valley. But views faltered among those committed to secession. Janet Colman from Guava Village said she did “not really” want the mine to reopen.

If I had a choice, but I don’t think I have a choice. If I am crying for independence; then I need the mine.

When BCL’s latest bid was defeated, Bougainville’s President John Momis announced an indefinite moratorium on exploration and mining in Panguna, highlighting his fears of potential conflict between landowner factions.

However, the link between mining and political aspirations continues to fuel the contest for Panguna’s wealth. Other foreign companies are jostling for position, such as Perth–based RTG Mining, which has forged an alliance with Philip Miriori, former combatant and now president of the Panguna–based Mekamui government, and chairman of the Special Mining Lease Osikaiyang Landowners Association.

Three years ago, Bougainville passed new mining legislation vesting traditional landowners with ownership of minerals on their land and rights to participate in key development decisions. At the same time, power plays appear to be mounting between Panguna landowning clans and groups; those who previously, without rights, united against a common external foe. As Baria explains:

people who come from around the mine area are not homogenous, and deep divisions exist along family and clan lines going back to the time before the Crisis.

Mining companies now understand they will not be successful without landowner support. At least five ex–combatants and local leaders are known to be entertaining a range of corporate interests from Australia, Canada, China, Brazil and the US.

It is another hurdle for Momis and his government, who are working to rally a sense of political unity in a Melanesian society, where people still prioritize allegiance to their clan and customary land.

Panguna mine in operation, circa 1971 (Photo: Robert Owen Winkler/Wikimedia Commons)

Suspending developments in Panguna aligns with those landowners, such as Lynette Ona, Chairwoman of the Bougainville Indigenous Women’s Landowner Association, who believe the mine should stay closed until they can master their own destiny. Yet independence in itself won’t remove landowner rivalries or other risk factors Bougainville is currently challenged with, such as high youth unemployment, constrained institutional capacity to reach and govern rural areas and incomplete disarmament. Some armed groups, such as the Mekamui Defence Force, didn’t sign the peace agreement or surrender firearms.

Helen Hakena of the local Leitana Nehan Women’s Development Agency has expressed concern that “they [the Mekamui] get their strength from guns … there needs to be a priority set by the government in getting those arms out before the reopening of the Panguna mine”.

Bougainville is still working toward establishing the post–war unity, strong governance and state resources that are needed to manage the complex combination of post–conflict recovery, unaddressed mining grievances, and risks of resource–related corruption and land disputes. For mining, without peace, won’t contribute to Bougainville’s longing for successful self–government and equitable development.

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