Tag Archives: Bougainville Copper Limited

Bougainville president accuses mining company of lying to Australian stock exchange

Bougainville’s Panguna mine, for which RTG Mining is seeking an exploration licence.

John Momis says his government ‘will not rest’ until Australian-linked miner seeking licence for Panguna mine is banned for life from Bougainville and PNG

Kate Lyons | The Guardian | 24 January 2020

The president of the autonomous Bougainville government has accused an Australian-linked mining company of lying to the Australian Securities Exchange over its plans to reopen one of the world’s largest copper mines.

In a scathing statement, John Momis, the president of the autonomous Bougainville region, accused the Australian-linked RTG Mining of “lies and deceptions” and said his government “will not rest until all RTG and their executives are banned for life from Bougainville and Papua New Guinea”.

Momis was referring to a statement issued by RTG Mining to the ASX on Tuesday in which the company sought to clarify recent press reports, which have alleged that RTG staff are banned from entering Papua New Guinea.

In December, after the results of a referendum that saw almost 98% of Bougainvilleans vote in favour of independence from PNG, Momis issued a warning banning people affiliated with certain foreign mining companies, including six from RTG and one from Kalia Group, from entering Bougainville. Momis said they were creating “disharmony” in the region and that he had sought the assistance of the PNG prime minister and office of immigration and border security to assist with keeping them out of Bougainville.

However, RTG clarified in its statement to the ASX that its executives were “not banned from travel to Papua New Guinea” and emphasised that “the national government currently [have] constitutional authority over border control for the country”.

RTG is seeking to secure an exploration licence at the Panguna mine in Bougainville. The Panguna mine was at the heart of the brutal civil war in the region that saw an estimated 20,000 people killed between 1988 and 1997. The mine, which once provided 45% of Papua New Guinea’s export income, has been mothballed since the conflict began, but there has been talk about reopening it.

Among the companies in talks about resuming mining in Bougainville are RTG, which is listed on the Canadian and Australian stock exchanges, ASX-listed Kalia, Bougainville Copper Limited, a former subsidiary of Rio Tinto that ran the Panguna mine in the 1970s and 1980s, and Caballus Mining.

Andrew “Twiggy” Forrest has also expressed interest in mining in Bougainville, with the Sydney Morning Herald reporting that representatives of his mining company, Fortescue, travelled there in 2019 to explore “potential opportunities”.

There are disputes over land rights at the Panguna mine site, but RTG is the joint venture partner of the Special Mining Lease Osikaiyang Landowners Association (SMLOLA). RTG wrote in their statement to the ASX that the members of the SMLOLA “are the customary landowners who own the minerals at the Panguna Mine under the Bougainville Mining Act”.

However, Momis said the SMLOLA was established under an old system and that the autonomous Bougainville government considered its claims over the mine “illegal, null and void”.

There are concerns that disputes over land rights at the mine site might reignite tensions in the region. The Bougainville government enacted an indefinite moratorium on renewing the licence of BCL, a controversial mining company, in January 2018 over fears it could reignite violent civil conflict. However, since then, the government has shown signs that it was in favour of restarting mining in the region.

Despite voting for independence from PNG, the question of how an independent Bougainville would support itself hangs over the vote, with some experts saying it is impossible for Bougainville to become financially independent without a strong mining industry and that it would take much longer for other mining projects to be established and become profitable than it would take to reopen Panguna.

The autonomous Bougainville government and RTG Mining were contacted for comment.

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Mining Hopes for Independence

An aerial view of the Panguna mine located in the autonomous region of Bougainville on July 20, 2015, in Papua New Guinea.(USGS/NASA LANDSAT/GETTY IMAGES)

A copper quarry helps fuel Bougainville’s hopes for separation from Papua New Guinea, a move that would resonate across the Pacific.

By Geoff Hiscock | U.S. News | July 1, 2019

THE Pacific island of Bougainville is moving a step closer to potential independence from Papua New Guinea as preparations begin for a long-promised referendum later this year.

Whether it can survive as a stand-alone nation is a key question for its 250,000 inhabitants, and for other separatist movements in the Pacific. The future course of the island could ripple across the region, as the question of Bougainville’s independence will touch on a complicated mixture of business concerns, environmental worries and geopolitical interests stretching from Australia and New Zealand to ChinaJapan and the United States.

It’s an outsized international role for Bougainville, which lies 900 kilometers (560 miles) east of the Papua New Guinea mainland. The roots of the referendum stem from a bitter inter-clan and separatist conflict that ran from 1988 to 1997, fighting that claimed between 10,000 and 20,000 lives through a combination of violence, disease, poverty and dislocation.

A truce brokered and maintained by regional neighbors that included Australia, New Zealand and Fiji helped restore order, and a comprehensive peace agreement was signed between Papua New Guinea and Bougainville in 2001. The island has had its own autonomous government since 2005.

Bougainville’s people are expected to vote decisively for independence in the Oct. 17 referendum, according to Jonathan Pryke, Pacific Islands program director at the Lowy Institute, a Sydney-based policy think tank. The vote is not binding and any move toward independence will require agreement from the central government of Papua New Guinea, commonly referred to as PNG.

Most people hope the two sides can find a “Melanesian solution” that will deliver a workable form of autonomy for Bougainville, says Pryke, using the term that describes the region of the South Pacific that includes PNG, Fiji, the Solomon Islands and other island nations and territories.

James Marape, who took over as Papua New Guinea’s prime minister in late May, said on June 14 he would prefer Bougainville to remain part of a unified nation, but would listen to the people’s voice and then consult over future options.

Papua New Guinea’s new prime minister, James Marape, arrives at the house of Governor-General Bob Dadae to be sworn in as the new leader in Port Moresby on May 30, 2019.(GORETHY KENNETH/AFP/GETTY IMAGES)

Peter Jennings, executive director of the Australian Strategic Policy Institute in Sydney, says the desire for independence in Bougainville remains strong, but from a regional perspective it will be best if the Bougainville people decided to stay in Papua New Guinea. “We don’t need another microstate emerging in the Pacific.”

Australian Foreign Minister Marise Payne, who visited Bougainville on June 19 with PNG’s new minister for Bougainville Affairs, Sir Puka Temu, said Australia will work to ensure the integrity of the referendum and will not pass judgment on the result. Australia is by far the biggest aid donor in the Pacific region, giving $6.5 billion between 2011 and 2017, according to research last year by the Lowy Institute. Most of Australia’s aid goes to Papua New Guinea.

Scars Remain From a Civil War

The Bougainville conflict, in which rival clans on the island fought among themselves and with the Papua New Guinea Defence Force, evolved from multiple issues, including land rights, customary ownership, “outsider” interference and migration, mineral resource exploitation, and perceived inequities and environmental damage associated with the rich Panguna copper mine.

Under the terms of the 2001 peace agreement, a vote on independence within 20 years was promised.

A reconciliation ceremony will be held on July 2 between the central PNG government, the national defence force, the Autonomous Bougainville Government and the Bougainville Revolutionary Army.

Deep scars remain from the conflict, both physical and emotional. Much of the island’s public infrastructure remains in poor shape, educational opportunities are limited, and corruption is pervasive. Clan rivalry and suspicion persists, particularly in regard to land rights and resource development.

Since Panguna closed in May 1989, Bougainville’s people have led a life built around agriculture and fishing. The cocoa and copra industries ravaged by the war have been re-established, there is small-scale gold mining, and potential for hydroelectric power and a revived forestry industry. For now, a lack of accommodation inhibits tourism.

Copper Mine Underscores Doubts over Bougainville’s Economic Viability

Almost 40 years ago, Bougainville’s Panguna mine was the biggest contributor to Papua New Guinea’s export income and the largest open-cut in the world. But the mine, operated by BCL, a subsidiary of Conzinc Riotinto Australia (now Rio Tinto Ltd.), became a focal point for conflict over pollution, migrant workers, resource ownership and revenue sharing, and has been dormant since 1989.

Apart from any foreign aid it may receive, Bougainville’s future prosperity may well depend on whether it can restart the mine, which contains copper and gold worth an estimated $50 billion. But customary ownership claims – land used for generations by local communities without the need for legal title – remain unresolved and at least three mining groups are in contention, which means an early restart is unlikely. Jennings cautions against investing too much hope in Panguna, with remediation costs after 30 years of disuse likely to be high.

Likewise, Luke Fletcher, executive director of the Sydney-based Jubilee Australia Research Centre, which studies the social and environmental impacts of resources projects on Pacific communities, says reopening Panguna would be a long, expensive and difficult proposition. He says the challenge for any mine operator would be developing a project that is environmentally safe, yet still deliver an acceptable return to shareholders and to the government.

Bougainville’s leader, President John Momis, believes that large-scale mining offers the best chance for income generation and is keen both to revive Panguna and encourage other projects. That would require outside investment, which was a factor contributing to the outbreak of violence in the late 1980s. The local community perceived that it was not getting its fair share of Panguna’s wealth.

Rio Tinto gave up its share in BCL in 2016, and ownership now rests with the government of PNG and the Bougainville government, each with 36.4%. Independent shareholders own the remaining 27.2%.

At least two other groups are vying to operate Panguna. Sir Mel Togolo, the BCL chairman, told the company’s annual general meeting on May 2 that continued uncertainty about Panguna’s tenure remains a big challenge. “We will need to work cooperatively with all stakeholders to achieve our objective of bringing the Panguna mine back into production,” he said.

Regional, International Eyes on October Referendum

With doubts persisting about Bougainville’s economic viability if it cuts ties with the central government, the referendum outcome will be closely watched by other PNG provinces pushing for greater autonomy, such as East New Britain, New Ireland and Enga.

Across the region, some parts of neighboring Vanuatu and the Solomon Islands are agitating for their own separate identities. In the nearby French overseas territory of New Caledonia, voters rejected independence from France by a 56 percent to 44 percent margin in November 2018. European settlers were heavily in favor of staying part of France, while indigenous Kanak people overwhelmingly voted for independence.

At the international level, Australia will be keen to ensure that whatever the outcome of the Bougainville referendum, stability is maintained in Papua New Guinea, if only to counter China’s growing interest in offering aid and economic benefits as it builds a Pacific presence.

Along with Japan, New Zealand and the U.S., Australia has committed to a 10-year $1.7 billion electrification project in Papua New Guinea. Australia and the U.S. have agreed to help Papua New Guinea redevelop its Manus Island naval base, which sits 350 kilometers north of the mainland and commands key trade routes into the Pacific.

Jennings says Australia would be likely to give aid to an independent Bougainville to try to keep China at bay. “China is everywhere. Its destructive connections co-opt leaderships in a way that doesn’t work out well for people.”

From a strategic perspective, Jennings says it would be best if Melanesia looked to Australia as its main partner on matters of security.

While China gives most of its aid to PNG and Fiji, the region’s two biggest economies, Jubilee’s Fletcher says China giving aid to an independent Bougainville was “feasible.”

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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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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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MP upset at Australian advisors in Bougainville

A lake in the pit of the long defunct Panguna mine in Bougainville. Photo: www.travelinspired.co.nz

Radio New Zealand | 23 August 2018

An MP in the autonomous Bougainville parliament says Australian aid to the region is being used to jockey for position ahead of the vote on possible independence.

Bougainville is due to vote next year on whether to remain part of Papua New Guinea or choose independence.

Donor nations have started increasing their support but MP Joseph Watawi is taking issue with Australia sending in teams of advisers, without consultation.

He says the advisers are there to gain political power and influence for Australia when what Bougainville needs are nurses, doctors and engineers.

Mr Watawi told Don Wiseman he thinks the Australian assistance is focused on the possible re-emergence of the former Australian owned mining company, Bougainville Copper Ltd – the company which sparked the Bougainville crisis.

TRANSCRIPT

JOSEPH WATAWI: So rather than Australia trying to get back here under the cover of BCL, to re-open the mine, I think it is a fair thing for them to seriously look at how they can provide some form of redress to the people of Bougainville through supporting the current, ongoing reconciliation process in Bougainville. That’s what I see it is currently lacking.  

DON WISEMAN: You have been critical of Australia sending in advisers but the truth is isn’t it, that the ABG – the Bougainville government – still needs advice. It hasn’t got a lot of the capacity it needs if it is going to get itself organised for this vote.  

JW: So called advisors, which have flooded the Bougainville administration, I think some of these are absolutely unnecessary. Only on areas which we think we need critical advice then we should be able employ people that we identify and people that might come from Australia, but there are other places. In PNG we also have a lot of retired public servants who may be able to engage in terms of  providing capacity in whatever administrative area that we think we need and require that kind of advice. I don’t see a wholesale advisory capacity that should come from retired Australia. It is like Australian aid is being given to Bougainville and we take it on the right hand and they take it back on the left hand. So it really doesn’t make any sense.

DW: When you say unnecessary advisors, what are you thinking of?

JW: Well in areas where we think it is necessary that we should have some advisers, then we should engage people in those areas that must be identified in terms of strategic advice in what ever areas. For example in terms of growing the economy, I think it is an area we think we can probably need some expertise in giving us some rough forecast on what they think the economy will be like in the next ten years down the road. So these are some of the areas I think we could be able to take on advice, but anything else, in terms of weapons disposal – what do they know about weapons disposal when we own the weapons here, and we think we had ways and means to deal with people who are holding onto weapons.

DW: The New Zealand government has also stepped up its involvement and I see from a press release you have put out that you are quite happy with what New Zealand is doing. So what is the difference between what New Zealand is doing and what Australia is doing?

JW: New Zealand I think, because they are also based with the culture of the Maori people and I think they know how to deal with the indigenous people and the manner in which they offer their support and assistance, particularly on the policing service, I see the role New Zealand plays also involves some kind of customary, cultural relationship that sort of enhances the manner and the attitude they are offering the kind of advice and support, in terms of capacity for Bougainville, and that’s the difference I see. 

DW: There are discussions around restarting mining on Bougainville, and BCL is one of those, but it is not of course an Australian company anymore is it? You have tied this Australian involvement into a possible return of BCL but BCL is now owned by Bougainville and the PNG governments, isn’t it?

JW: The sale by Rio Tinto to the PNG government and the ABG was a rush job, and I think it was just a way out, of Rio Tinto not willing to address the legacy issues in terms of the environmental damages and all of these other things that they had created while operating the Panguna mine. And not only that but even they wanted to basically pass on some of these liabilities to the ABG. I think Rio Tinto on that note basically, just acting, like, you know, we don’t want to know what happened to you guys. We picked up the wealth and whatnot from your ground, and therefore we do not to come and recognise the difficulties you are suffering, the pain the people have gone through. From my observation and analysis this is very unfair.    

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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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IS BOUGAINVILLE ON THE BRINK OF WAR?

MOST OF THE NEWS COMING OUT OF PAPUA NEW GUINEA TODAY IS ABOUT THE REFUGEE CRISIS ON MANUS ISLAND. BUT 1,000KM SOUTHEAST OF MANUS ON BOUGAINVILLE ISLAND, A LITTLE-KNOWN STORY ABOUT THE BLOOD-SOAKED 40-YEAR-LONG INDEPENDENCE STRUGGLE OF A QUARTER OF A MILLION PEOPLE IS APPROACHING AN ENDGAME.

Ian Lloyd Neubauer | Penthouse | 13 July 2018

Cut from the pages of a glossy travel brochure and just smaller than Hawaii’s Big Island, Bougainville is blessed with incredible natural resources: sugar-white beaches, fisheries, hyper-fertile soil and one of the largest untapped mineral deposits on the planet – copper, silver, gold and uranium estimated to be worth hundreds of billions of dollars.

The largest known concentration of minerals lies in Panguna Mine, a vast hole in the ground in the Guava Mountains of central Bougainville. Between 1972 and 1989 it provided nearly half of PNG’s GDP and made billions in profit for its operator, Bougainville Copper Limited (BCL), a former subsidiary of Rio Tinto.

But while less than one per cent of those profits were reinvested in Bougainville, hundreds of millions of tonnes of tailings – the toxic by-product of industrial mining – were dumped straight into rivers, turning vast tracts of once-fertile farming and hunting grounds into barren, moonlike wastelands.

In the late 1970s, a landowner group led by Francis Ona presented BCL with a multi-billion dollar cleaning bill. BCL, however, claimed it was in compliance with the law while concurrently insisting it had not damaged the environment. It continued to dump tailings into the rivers like a careless tourist might drop a cigarette butt on the beach.

In 1988, push finally came to shove. Ona and his mob broke into BCL’s storerooms, stole a bunch of explosives and blew up Panguna’s power lines. The event marked the start of the longest conflict in the South Pacific since WWII and the world’s first successful eco-revolution – an episode of military history that has drawn parallels with the 2009 James Cameron film Avatar.

PNG sent in its army to crush the rebels, pitting Australian-supplied helicopter gunships and gunboats against a ragtag militia armed with slingshots and homemade rifles. When that failed, soldiers trained their sights on the general population, burning down villages, using rape as a weapon and executing alleged collaborators en masse. And when that failed PNG applied a cruel Australian-backed naval blockade, depriving the entire island of fuel, medicine and all contact with the outside world.

By the time a lasting peace agreement was signed in 2001, 15,000 to 20,000 Bougainvilleans – 10 per cent of the population – had been killed or succumbed to illnesses. For its woes, Bougainville was granted autonomy and tacit control of its fantastic mineral wealth, including the US$50 billion worth of copper and gold left at Panguna.

Now, a new-look independently listed BCL is plotting its return to Panguna, promising jobs and prosperity for all – despite not lifting a finger to clean the mess it left behind. Astonishingly, the Autonomous Government of Bougainville is courting the proposal because it desperately needs cash for an independence referendum scheduled for June 2019 and the prospect of running the world’s newest country the following year. But many Bougainvilleans hold serious grudges against BCL and warn if the company returns, war will follow.

HAPPY VALLEY

During the ’good times’ of the 1970s and 1980s, Arawa and its port Kieta, an hour’s drive from Panguna, was the second richest town in PNG. Hotels, restaurants and banks lined Happy Valley, Kieta’s dreamy beachfront strip, while cruise boats and sail craft crowded around the old yacht club.

All that remains of Kieta today are ruins overgrown with jungle and the wrecks of two small steamships at the end of a pier where Queen Elizabeth II and her royal entourage disembarked during a state visit in 1974. Arawa hasn’t fared much better; its wide boulevards lined with overgrown fields, stain-coloured apartment blocks and abandoned gas stations.

In Arawa I meet Philip Miriori, former private cabinet secretary of rebel leader Francis Ona, who died in 2005. Today Miriori is chairman of the Special Mine Lease Osikaiyang Landowners Association (SMLOLA), a group of 2,000-odd landowners who under the new Bougainville Mining Act hold rights not only to the topsoil but also the minerals underground. That makes Miriori one of the most powerful men in Bougainville and his opinion of BCL a matter of concern.

“BCL does not have any compassionate feelings. I have seen what they are capable of,” he says. “One night during the war, the PNGDF (PNG Defence Force) woke up everyone in my village and made us stand in a line while they burnt all our houses. I hold BCL directly accountable for what happened that night because BCL provided the soldiers with funding, logistics and shelter. Not as long as I am alive will I ever accept BCL coming back.”

Allegations of BCL’s complicity in Bougainville’s war stem back decades and have been corroborated by the highest level of government. In 2011, SBS’s Dateline unearthed an affidavit signed by former PNG Prime Minister Michael Somare that reads: “Because of Rio Tinto’s financial influence in PNG, the company controlled the government.” In a separate affidavit, former PNGDF general Jerry Singirok said the army “functioned as the corporation’s personal security force and were ordered by BCL to take action to reopen the mine – by any means necessary”.

BCL refused to comment for this story. But in a shareholder update released in October, the company claims it “has always maintained positive relationships in Bougainville” and “continues to respectfully build relationships with a range of stakeholders, including project area landowners”.

Yet in the very same document, the company scolds Miriori for “attack[ing] BCL through the media by using the title of SMLOLA chairman to convey the misleading impression that there is a united view of opposition to BCL”.

The notice also refers to a SMLOLA leadership dispute between Miriori and his cousin Lawrence Daveona, whose relationship with BCL stems back decades. Daveona was once president of the Bougainville Development Corporation, a purported BCL development fund that was run like a Fortune 500 company with interests in engineering, logistics and even mining. He was also a former director and secretary of BCL’s Roads Mine Tailings Lease Trust Fund – a body set up to administer compensation payments to Panguna landowners.

Daveona refused comment, citing ongoing court proceedings with Miriori. But he pointed out Miriori has a corporate sponsor of his own: RTG Mining, a Perth-based consortium that operates seven mines in five countries and is challenging BCL’s bid to reboot Panguna.

Miriori acknowledges he’s on RTG’s payroll but says his support for the company is based the award-winning environmental and social policies it has demonstrated at Masbate, the largest operating gold mine in the Philippines. “RTG will work well with the community,” he opines, adding: “If this story doesn’t go well, you will not be welcome back in Bougainville.

LEGACY PIT

In BCL’s October shareholder notice the company claims it is “increasing its presence in central Bougainville through the engagement activities of our local team”. 

Yet BCL has no official presence in Arawa. And it’s hard to imagine how a car with BCL logos could get past Alex Dakamari, a crusty old rebel with hangdog features who controls Morgan’s Crossing Checkpoint – a roadblock set up by Ona in the early 1990s on the only carriageway leading up to the mine.

“BCL are wasting their time. If they come back, we will fight,” Dakamari scowls. “We don’t want the mine reopened – full stop! Otherwise, all our money will go to white people like in the past. We were the owners and they turned us into beggars. They can’t get away with it again!”

Before it closed, Panguna was the largest open-cut mine in the world – 2.5 kilometres wide and half a kilometre deep. On one side of this titanic-size eyesore, a wall of untreated tailings hundreds of metres high marches slowly down a ravine. Millions of litres of opal-blue water rush from pit water drains on either side of this wall, forming waterfalls of the damned that lay waste to all life in the valley far below.

Dapera is a village that once sat right on top of the mine. In the early 1970s, BCL moved Dapera’s residents to a squatter settlement built on a plateau of crushed rock not far from the ore-sorting plant. A desolate collection of hardscrabble shacks, Dapera II is now home to a few hundred impoverished landowner descendants like Jayden Frankie.

“You can see the destruction BCL did to this community,” he says. “Before my father had good land. This is not good land. We can’t grow crops and when heavy rain falls, rocks in the ground turn blue and green.”

His friend, Richard Onio, voices similar sentiments. To find good land for farming we have to walk up to those hills,” he says, pointing to a steep ridge. “But it’s dangerous in heavy rains because of landslides.”

What do they think about the idea of a BCL comeback?

“They would not be welcome,” says villager Freddy Bernora. “We would send them off. They stole billions of dollars from us and I do not see how this company has changed.”

Frankie says he wants RTG to reopen the mine:

“We have seen some pictures of how RTG works in the Philippines, how people there live side-by-side with mining. They showed us how they produce benefits for landowners. They seem to respect landowners.”

“For me,” says Onio, “I am with neither RTG or BCL. I am neutral. I want to see if they meet our terms and conditions. I am not convinced by either side yet.”

CAESAR’S PALACE

On another plateau above the pit lies a small city where BCL housed more than 2,000 employees during the ’good times’. Today, around 8,000 landowners and squatters reside in the concrete skeletons of residential towers Ona and his mob set fire to after BCL withdrew. Masked in heavy fog, carpeted in moss and spattered with graffiti, it has the look and feel of a set from the Planet of the Apes.

Philip Takaung, Ona’s 77-year-old half-brother and Miriori’s deputy, is Caesar of this post-apocalyptic world. With the frame of a silverback gorilla and a crushing handshake to match, he makes an intimidating presence when I find him congregated with family and friends on the top floor of the tallest tower.

“When BCL came here and started polluting our land, we didn’t know anything about minerals. We had no education so they took advantage of us,” he says. “When we asked them to clean up the rivers, they did a feasibility study and said there was nothing poisonous in the water. We said NO! Our crops, our rivers, everything is dead! But they ignored us. They ignored us for 10 years until we took action. I was on that team with Ona that blew up the power lines.”

Takaung shows me his weapon of choice during the conflict: a nine-foot-long pole with a Y-shaped head known as the ‘Rambo Stick’ – a slingshot so powerful it can puncture a hole in a car, or take off somebody’s head. “This weapon is very good because it makes very little noise,” he says. “When you fire it, the enemy has no idea where you are. Then you can fire again.

I ask Takaung how many soldiers he killed during the war. He looks at two small children in the room who are glued to his every word, decides against answering and continues with his sermon:

“BCL burnt our villages. They tortured our people. They cut off people’s hands and threw them from helicopters. They raped our women, the young children, the men and old ladies! They put the machete in between women’s legs! I saw it! They slaughtered people like they were animals!”

On the way back to Arawa I stop at Anewa Bay, home to Bougainville’s modern port facilities.. There I meet port worker Francis Baubake, a withered old man in his fifties with a wooden leg and a terrible story to tell.

“In 1996, the PNGDF got a new mortar bomb that was untested. So they tested it on my family, “ he says. “We were in church in a refugee camp in Buin in the south when it hit us. My daughters Brenda and Alvina, seven and 12, and my wife Sicilia were instantly killed. I lost my leg,” he says, tapping his wooden stump.

I ask Baubake who he holds accountable for his loss. He stares numbly into the middle distance and thinks for a while before mumbling: “The PNGDF. The PNGDF and BCL.”

But when I ask what might happen if BCL returns to Bougainville, he answers without pause. “War,” he says, grinding his teeth. “War.”

THE NO-MINING VOTE

On my fourth day in Bougainville, I am struck with malaria and spend the next 24 hours shivering in bed, my joints and lower back burning with pain. The fever dissipates the next day but the experience makes me ponder the fate of an estimated 5,000 Bougainvilleans who succumbed to malaria during the blockade of the 1990s, and the poor state of health of most islanders today. In a squatter settlement next to my guesthouse, I find a man in his twenties with a cancer the size of a football growing from his heel.

More than half of all adults here are obese, while alcoholism is endemic. 

The war took everything out of everybody here and the trauma has been passed onto this generation,” says Geoff McAndrews, a Californian who recently opened Bougainville’s first surf camp. “There are no jobs. The only thing they have for entertainment is volleyball and homebrew.”

Over the next few days, I learn a significant minority are pro-BCL. “If BCL comes back, they can fix the environmental issues because they know all about them,” says accountant Lindsay Kalio. “I don’t think any other company can do this as we have no relationship with them.

Yet more than half of all islanders I speak to oppose any kind of industrial mining.

Our previous experience with mining was pollution and violence so I don’t want mining to come back,” says Alex Takena, a fisherman in Kieta. “We should focus on sustainable industries like copra (coconut) and cocoa farming.”

Lawrence Robert, a carpenter in Arawa, agrees. “I don’t think Panguna should reopen because our island is tiny and if miners come back, they’ll tear it to pieces. We should have tourism instead to promote our culture and heritage.”

Adds John Boscoe, a subsistence farmer from Oemah village in the island’s south: “Mining did not benefit any of us in in the past but we all lost our homes. If it happens again, the Panguna landowners will drink milk and honey and we will get nothing.”

The SMLOLA discounts anti-mining sentiment. “These people have to look at the bigger picture,” Miriori says. “Mining is the right choice for Bougainville because we need the revenue if we want to become an independent nation and generate employment and security. Panguna will reopen, whether they like it or not.”

BETTER THE DEVIL YOU OWN

A week passes until I regain enough strength to make the bone-jarring four-hour drive from Arawa to the capital Buka, which is as fly-blown as a place can possibly be.

When I arrive the city has been under a total electricity blackout for close to a week for reasons no one can explain. When I visit Bougainville’s House of Representatives in the middle of the day to make an appointment with President John Monis, no one is there. Ditto at the Ministry for Mineral and Energy Resources and BCL’s little office.

Later in the day, news breaks that the SMLOLA leadership dispute has ended and Miriori has emerged victorious. It sees RTG’s share price soar 83 per cent in a single day and the inking of a “historic” deal between the consortium and the SMLOLA.

“The Chairman and Mr Daveona have also pledged support for RTG as the preferred development partner,” RTG says in a statement. “This is a historic and important step for the landowners, with RTG being the first mining company that has been endorsed by the SMLOLA in 30 years.”

But the victory is short-lived. Bougainville Minister for Minerals and Energy Raymond Masono accuses RTG of trying to sneak into Panguna through the back door. “The Autonomous Bougainville Government rejects companies that think they can bribe their way into people’s resources by giving certain individuals money to gain landowner consent,” he says.

RTG rigorously denies it has bribed landowners even though Miriori admitted to me that he is on their payroll. However BCL has been busy handing out money to landowners, too.

In March of last year, BCL distributed US$1.5 million in compensation to landowners at a public ceremony in Buka attended by Masono. “It is not the devil that we used to know, but it’s now the devil that we own,” Masono said at the ceremony, adding that it would be foolish go out looking for other developers.

Masono’s comment about “the devil that we own” refers to Rio Tinto’s June 2016 decision to finally call it quits on Bougainville – and its subsequent donation of its majority shareholdings in BCL to the governments of Bougainville and PNG.

RTG chairman Michael Carrick says the move was in part an attempt by Rio Tinto to stack the deck in BCL’s favour. But the cards had already been stacked in a very big way by the authors of the 2015 Bougainville Mining Act, who gave BCL the first right of refusal to redevelop Panguna.

RTG’s Carrick insists the Act no longer applies. “BCL ’claims’ it has first right to the exploration license under the mining act,” he says. “But our legal advice is that the renewal application for extension of the term of their licence is invalid because it was submitted out of time and was incomplete.”

For his part Masono remains nonplussed, insisting BCL is still in the box seat and RTG doesn’t even have a seat on the table. “Right now, the only legal applicant on the exploration tenement is BCL,” he says. “Until that process is completed, there are no other applicants or applications over the same tenement. That’s the position of the government.”

THE PRESIDENT SPEAKS

On my last day in Bougainville, I score an interview with President John Momis at Buka’s tin-pot airport. Right from the get-go he contradicts Masono’s position and corresponding claims by BCL that its proposal has the support of the Autonomous Government of Bougainville.

“Currently we do not have a preferred partner. We will ask people who are interested to submit their applications and we will scrutinise their applications quite stringently,” the President says. “We are open to discussions with BCL but there’s whole new dimension today. They need to win the support of landowners who own the resources.”

I ask him what he thinks about RTG’s competing bid to redevelop Panguna, and of rumours that China is eyeing the mine.

“We are not sure about RTG,” he says. “They have to convince us first. I don’t know if they are in a strong position. As for the Chinese, they are not in the picture right now. But we are open for business.” 

And so the race for Panguna’s riches continues with no clear frontrunner. But no matter which company wins, three things seem certain.

First, the bulk of Panguna’s riches will inevitably end up in the pockets of oligarchs, shareholders and hopelessly corrupt officials instead of a sovereign wealth fund where it belongs. This prediction is drawn from the ’resource curse’, which dictates countries with lots of minerals tend to have less economic growth and democracy than countries with fewer natural resources. Hundreds of studies have been undertaken to prove the theory, though one need look no further to Hela Province on PNG’s mainland to see it happening in real time. There, ExxonMobil’s A$24 billion Liquefied Natural Gas (LNG) project has failed to deliver any significant development outcomes for landowners. “In fact, it has, in important ways, made life worse for the majority of people living in the project area,” says Michael Main, an Australian National University doctoral student conducting fieldwork in the area.

Which leads to prediction number two: if Panguna reopens, there will be blood. According to the World Bank study ‘Natural Resources and Violent Conflict’, countries that export around five per cent of GDP have a six per cent risk of conflict. But when exports reach 25 per cent of GDP, the probability of conflict climbs to 33 per cent. If Panguna reopens, exports of minerals will account for close to 100 per cent of Bougainville’s GDP. That doesn’t bode well under the World Bank’s formula. And despite reassuring me the plans to reboot Panguna’s will definitely go ahead, a fortnight after I leave Bougainville he changes his mind, announcing an indefinite moratorium.

We will not allow this project once again to reignite the wounds of the Bougainville crisis and distract our focus for restoring peace and our preparation for our referendum in 2019,” he told New Zealand’s Asia Pacific Report.

The decision is a breath of fresh air and a rare example of a politician in PNG making an unpopular and unprofitable decision that is beyond a shadow of a doubt in the best interest of constituents.

My final prediction for Bougainville? That the people will overwhelmingly vote in favour of self-determination when they go to the polls in 2019. “We in Bougainville have a huge passionate ambition,” Monis told me before I left, mirroring the thoughts of every Bougainvillean I interviewed on the subject. “And that ambition is to liberate ourselves from all kinds of transgressors, evil and marginalisation so there will be unity to affect the kind of changes we need to truly become free.” 

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