Tag Archives: Bougainville

Can Bougainville rebuild on the broken corporate dreams of the colonial age?

Bougainville Revolutionary Army guerillas stand next to a destroyed dump truck at Panguna mine in 1994. CREDIT: BEN BOHANE

Ben Bohane | Fairfax Media | November 16, 2019

To view the Panguna pit is to witness an industrial apocalypse and one of the largest man-made holes in the world; a vast open-cut copper and gold mine in the highlands of Bougainville island, slowly being reclaimed by jungle.

Bits of twisted metal and rusting debris lie scattered everywhere, buildings and heavy machinery smothered under moss and creeping vine. Here lie buried the broken corporate dreams of a colonial age but also the promise of a future with local landowners in control.

Before guerrillas from the Bougainville Revolutionary Army forced its closure in May 1989, Panguna was one of the most advanced – and profitable – mining operations in the world. It was operated by a company called Bougainville Copper Limited. Its parent company Rio Tinto, one of the biggest in the world, called Panguna “the jewel in our crown”.

Yet locals saw little of the wealth. Australian officials administering Papua New Guinea in the late 1960s made it clear to local landowners that Panguna’s riches were to underwrite the economy of the whole country as it headed to independence in 1975 and beyond. And that, inevitably, led to war.

‘Kastom’: responsibility

Although anthropologists had told the company that Bougainville was matrilineal – that it was women who owned the land, not men – the mine proceeded to do all its dealings with men. Women opposed it from the start.

In 1988 the New Panguna Landowners Association usurped the previous one and the senior woman in the area, Perpetua Serero, issued a demand to the mining company: pay 10 billion kina ($4.2 billion) in compensation for use of the land and renegotiate the mine lease. Their demands were ignored.

When Serero died soon after, her brother, Francis Ona, a former surveyor at the mine, took on the “kastom” – responsibility – on behalf of the women owners to reclaim the land, even if it meant war. Ona went bush with a stack of stolen dynamite from the mine and formed the first cell of the Bougainville Revolutionary Army (BRA), soon launching attacks on the mine. Several mine workers, including an Australian, were shot, prompting closure of the mine and declaration of a State of Emergency by PNG.

Within months Bougainville descended into a war as the PNG Defence Force tried, unsuccessfully, to regain control of the island. In the next 10 years, an estimated 10 to 15,000 people died, mostly from preventable disease because PNG imposed a naval blockade of the island which stopped vital medicines getting in.

The mine – or more accurately, the total mineral wealth of this island in the south Pacific – remained at the centre of the dispute. When I interviewed Ona in his Guava village above the mine in 1994, at the height of the war, he showed me plans by BCL to establish several other mines on the island.

BRA leader Francis Ona with his men in his home village of Guava, above the Panguna mine, in 1994. CREDIT: BEN BOHANE

“When we broke into the company safe and I saw the plans, I knew our fears were true,” he said. “BCL wanted to mine the whole island and our people were worried they would all be moved off the island so the company could mine everywhere.”

Although it’s unlikely the mine could have done so, or the PNG government would have allowed it, such concerns in a community with little access to information or understanding of the space-age project planted on top of a tribal culture added to resentment and suspicion. People were already angry at pollution from the mine, the lack of royalties accruing to them and the growing number of PNG mainlanders arriving to take jobs that locals believe should have been reserved for them.

Ceasefire and reconciliation

By 1997, the women had had enough of the war and convinced their men among the rank and file of the BRA to seek a peaceful, diplomatic route to achieve their common goal: independence.

A ceasefire was brokered in 1997 by New Zealand and in 2001 the comprehensive Bougainville Peace Agreement was signed by PNG and all the warring factions, except a BRA breakaway group called the Me’ekamui Defence Force (MDF). The MDF still controls the Panguna site today. Nevertheless they have recently contained their weapons under UN supervision and will join the rest of Bougainville in voting.

Rebel guerillas above the Panguna copper and gold mine in Bougainville in 1994. CREDIT: BEN BOHANE

Any grievances about the mine and colonial administration need to be weighed against the fact that Bougainville was the most prosperous province of PNG during the 1970s and ’80s. It had good infrastructure, including roads, hospitals and schools. BCL paid substantial tax but was caught in tensions between provincial and national governments. Many Bougainvilleans were trained by the mine and local businesses, with some going on to careers elsewhere in PNG and overseas.

Today, Bougainvilleans have reconciled after a 20-year peace process and are poised to vote in a referendum they have long awaited. Although it is expected a large majority will vote for independence, the final outcome must be ratified by the PNG parliament – which is not certain. If successful, Bougainville will become the newest nation in our region since East Timor.

A sign advertising a weapons surrender process and urging an independence vote on Bougainville. CREDIT: BEN BOHANE

More than 206,000 voters are registered and 246 polling teams have spread across the Bougainville islands, Australia, PNG and the Solomons. The two-week voting period begins on November 23 and ends on December 7, with results expected soon after. Overseeing the vote is the chairman of the Bougainville Referendum Commission (BRC), former Irish prime minister Bertie Ahern, who has said the referendum “should be celebrated”.

Despite being scarred by the history of mining there, Bougainvilleans are pragmatic and many believe they need mining to underwrite a newly emerging nation. Although its infrastructure has been destroyed, Bloomberg recently estimated that the Panguna mine alone still contains up to $US58 billion ($84 billion) worth of copper, gold and silver.

In fact, the whole island is known to be rich in minerals and mining has never stopped. Villagers continue to pan for alluvial gold in rivers and streams across Bougainville, as well as the tailings area of the Panguna mine. Recently I watched young and old villagers close to Panguna clawing away at the hillside, using high-powered hoses and pickaxes to create a slurry they could then pan through to find precious little nuggets.

During the war I saw Nescafe jars filled with gold being smuggled out of the island to buy essential goods in the neighbouring Solomon Islands. Estimates vary, but since the war ended somewhere around $50 million per year is being earned by locals through alluvial panning.

But big external players are circling too, hoping to get exploration licences to mine Bougainville’s riches. Apart from the contested Panguna licence, four exploration licences have been issued by the Autonomous Bougainville Government since they were able to draw down mining powers from PNG.

The Panguna mine: one of the largest man-made pits in the world.

Former BRA commander “General” Sam Kauona has one licence, Filipino company SRMI has another while Perth-based Kalia has two licences. Other Australian companies such as Fortescue are in talks, while China is also pitching infrastructure deals based on the “collateral” of Bougainville’s mineral wealth.

Last December a delegation of 10 Chinese businessmen approached the “Core” group of Bougainville veterans and leaders offering up to $1 billion to invest in mining, agriculture, tourism and the “transition” from autonomy to independence.

Even today, some Panguna landowners are in favour of BCL or its former parent company, Rio Tinto, returning “after they have properly reconciled with us and cleaned up their mess”. Amidst the uncertainty of new players circling, as well as growing geopolitical tensions, there is an oft-heard refrain: better the devil you know.

‘Australia’s secret war’

While some worry about growing Chinese influence, others are equally critical of Australia’s failure to present a viable alternative and the lack of personal engagement by Australian officials on the ground. Although Australia’s leaders are mindful of PNG sensitivities ahead of the referendum and want to avoid being seen to favour either side, Bougainvilleans wonder if Australia is indeed “neutral” now or will continue to work with PNG to deny Bougainville’s independence.

PNG army troops on patrol in heavy jungle in 1997, hunting for guerillas who had shot a boy dead nearby. CREDIT: BEN BOHANE

This has geopolitical consequences as China woos key players on Bougainville who remain suspicious of Australia’s position.

Australia has a long and sometimes troubled history with Bougainville. Today it is a valuable aid partner, providing around 12 per cent ($50 million per year) of Bougainville’s bilateral aid program, the highest of any donor. It has positioned itself as the partner of choice for Pacific nations, particularly after the “step up” began in 2017.

Between 1915 and 1975 Australia directly administered the territory. The very first action of the national Australian military at the outbreak of World War I – well before the Gallipoli landing – was to take control of German New Guinea, including Bougainville.

In World War II, 516 Australian soldiers and up to 40,000 Japanese died fighting on Bougainville. Australian Coastwatchers, hiding in the hills and protected by loyal locals, provided such valuable intelligence to the Americans taking Guadalcanal to the east that after the war US admiral “Bull” Halsey personally thanked them, saying they had “saved the Pacific”.

After the war, large cocoa plantations were established along with the Panguna mine. Australian riot police were used several times to quash the budding local independence movement. Two universal declarations of independence, first in 1975 and then in 1991, went unrecognised.

And during the Bougainville war between 1988 and 1998, Australia continued to train and equip  PNG forces. Some called it “Australia’s secret war” since Canberra tried to maintain an appearance of neutrality while supplying PNG with four helicopters that were soon turned into gunships.

Since the war Australia has funded a 20-year peace process and has won local and regional admiration for the way it allowed traditional reconciliation processes to unfold.

While Bougainvilleans remain suspicious of Australia’s real position on independence, they are thankful for the role it has played in the peace process and its ongoing development assistance.

Rough seas ahead?

In the wake of the referendum, if PNG, Indonesia or Australia were to attempt to deny or campaign against Bougainville independence, there is a strong possibility that hardliners on the island would issue another unilateral declaration of independence that some countries in the Pacific – and Beijing – might recognise. In that scenario, the potential for another security crisis in the region is real.

If the outcome of the referendum is an overwhelming vote for independence, Canberra must be prepared for two possibilities: either the creation of a newly independent nation in the region, or a crisis unfolding if the PNG government refuses to ratify the result.

Heavy trucks sit rusting on the edges of Panguna copper mine, closed in 1989 as a result of sabotage. CREDIT: FRIEDRICH STARK / ALAMY STOCK PHOTO

On top of all this there are Australian miners courting various groups within Bougainville to get access to the hidden riches of the Panguna mine and other mineral resources across the islands.

It has prompted some observers to wonder if these new mining players in Australia and China are fully aware of the history of mining and conflict here, as they try to cash in at this sensitive moment when Bougainville is on the cusp of nationhood and trying to forge unity among its people.

Recent reconciliation ceremonies between the PNG military and Bougainville militants declared there will be “no more war”. Now, as polling day nears, Bougainvilleans look set to accomplish something Francis Ona told me during the war he wanted.

“We have been ruled by four colonial masters over the past 100 years: first the Germans, then the Australians, then the Japanese, the Australians again, then PNG.

“We believe it is time we ruled ourselves now.”

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Breathtaking images depict Bougainville’s ‘blood generation’

Sami and the Panguna mine – Taloi Havini and Stuart Miller.

A photography exhibition featuring more than 200 images that explore the phenomenal complexity of modern life is being staged at the National Gallery of Victoria from 13 September to 2 February 2020.

Titled Civilisation: The Way We Live Now, the exhibition will feature images from Africa, the Americas, Asia, Australia and Europe.

Among the images is series dedicated to the ‘blood generation’ of young people born during the bitter and prolonged war between Papua New Guinea and the people of Bougainville (1988–98). The war, which was triggered by external interests in mining and sustained by local acts of political self-determination, resulted in 20,000 deaths and forced many Bougainvilleans to desert their villages in fear of their lives.

Bougainville-born artist Taloi Havini and Australian photographer Stuart Miller explore the repercussions of copper mining and armed conflict on the young people of the region and address the destruction of the natural environment that, for matrilineal societies of Bougainville and Buka, is foundational to their political and social organisation.

The image shown above, Sami and the Panguna mine, revisits a moment in history when female landowners in Bougainville protested against the gouging of their land by mining. In a powerful manifestation of opposition, dissenting mothers held their children, squatted and chained themselves to the mine’s earth-moving trucks in protest.

The National Gallery of Victoria describes the image as a magical and numinous image, yet its dark and traumatic history, as the heart of the Bougainville war, insinuates its presence through a row of burnt and rusted heavy equipment left behind when the Panguna mine closed in 1990. Sami, a child refugee, escaped with her family to Honiara in the Solomon Islands before obtaining refugee status in the Netherlands. The white cloud rising over the hills suggests that nature is there to welcome and shield Sami as she re-enters contested matrilineal land where the world’s largest open-cut mine of its time once stood. A pool of aquamarine-coloured water at the bottom of the pit, contaminated with the copper solution, is the result of a leaching process still happening today.

Siwai on the airstrip. Taloi Havini and Stuart Miller

Siwai on the airstrip shows a young man from Siwai, a large area of the coast, central plains and hinterland of Bougainville. He is dressed in torn jeans and a hessian bag embellished with an image of a skull, which reflects the style of today’s Bougainville youth. In the background, other Siwai young men sit at the centre of the airstrip, as is customary, except when the landing of a plane forces them to move to the edge.

Gori standing in a Buka passage. Taloi Havini and Stuart Miller

Gori standing in a Buka passage shows a young man standing in front of a narrow strait, less than a kilometre wide, which separates the Island of Buka from the northern part of Bougainville. Gori gazes directly into the camera as if to ask what happened, or to say, ‘I know what happened but I don’t understand why’. This is a common feeling among the blood generation, the silent victims of the Bougainville war, who were far too young to comprehend its inexorable repercussions.

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Bougainville veterans reconcile, commit to referendum

Inside the pit of abandoned Panguna mine

Don Wiseman | Radio New Zealand | 27 July 2019

A summit of huge significance for the future of Bougainville has taken place over the past week, in and around Panguna.

The focus of the Bougainville Me’ekamui and Veterans Summit was a reconciliation between former combatants in the region, and came just months out from a referendum on independence from Papua New Guinea.

It involved former combatants from both sides of Bougainville’s brutal civil war of which the referendum is one of the ultimate expressions.

The groups issued the Mary, Queen of the Mountains – Panguna Declaration.

This includes commitments to the referendum, to maintain peace and stability before and after the referendum, the disposal of weapons, and agreement that the Panguna mine can be re-opened after the vote.

Weapons Disposal

The summit attendees, now known officially as the Bougainville Veterans, aim to have guns held by former combatants and civilians contained by 15 August, with an ultimatum that the collection process be completed by 1 September.

The verification of the guns will be done by the Bougainville Police Service, working with community governments and veterans.

Eventually these weapons will be destroyed and a monument created from them.

Bougainville Peace Agreement ceremony in Arawa in August 2001 Photo: RNZ Walter Zweifel

Referendum

The vote was to be held from 12 October, having already been moved from June, but the Bougainville Referendum Commission had been seeking an extension of six weeks.

This has now been agreed to by the Bougainville Veterans, but they say the referendum must happen by 30 November at the latest.

Further Reconciliations

The veterans have urged additional reconciliations. They want to reconcile with PNG security forces – the army, police and prison services.

They also want the leadership of the two governments, Bougainville and Papua New Guinea, to reconcile before the ratification of the referendum outcome.

The veterans also say reconciliation with neighbouring Solomon Islands is a priority and are seeking donor support to facilitate this.

Bougainville government president John Momis, left, and Papua New Guinea Prime Minister Peter O’Neill sign the agreement on the question for the independence referendum. Photo: Joseph Nobetau

Economic Development

How to grow the Bougainville economy has long been debated in the region.

Several groups have been eyeing the re-opening of the controversial Panguna mine, which was forced to close 30 years ago at the start of the 10 year civil war.

Environmental and social damage caused by the mine sparked the conflict.

The veterans have agreed, however, the mine can be re-opened after the referendum. But because of the sensitive nature of the matter, public debate and discussions should be discouraged until after the vote.

Any decision on how mining might proceed will also wait until after the referendum and not before appropriate legislation on land, the environment and conservation is put in place.

At its peak, the mine produced almost half of PNG’s export revenue and is still considered to contain one of the largest copper reserves in the world.

The Bougainville Veterans also talked about the importance of investigating other options for fostering economic development, such as fishing and agriculture.

Amnesty

The Bougainville Peace Agreement, signed in 2001, included provisions for amnesty for all persons involved in crisis related activities or convicted of offences arising from them.

In the Mary, Queen of the Mountains – Panguna Declaration, the Bougainville Veterans say these provisions must be extended to beyond 2020 and include members of the Me’ekamui factions as well as other groups and individuals who join in the gun disposal programme.

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Failed Nautilus CEO resurfaces in Bougainville

Kalia Limited’s new Director Corporate Development and Strategy, Michael Johnston, jumped ship as Nautilus sunk, leaving PNG tax payers $120 million poorer

Having duped the PNG government out of K375  million the former CEO of bankrupt Nautilus Minerals has joined another debt heavy exploration company, this time hoping to strike gold on Bougainville 

Board moves boost Kalia Bougainville copper/gold play

Matt Birney | The West Australian | 25 July 2019

Bougainville Island focussed porphyry copper-gold exploration company, Kalia  Limited, has restructured its management ahead of a significant ramp-up in regional

The company has this week appointed two new directors with a wealth of resources sector experience, following the increased activity of private investment firm Tygola Pty Ltd, who continue to strongly support Kalia via a series of loan facilities, that amount to $6m.

Michael Johnston has joined the company as the Director Corporate Development and Strategy, bringing his extensive experience working in PNG and the wider Asia-Pacific region to the Board, particularly as General Manager of Placer Dome’s exploration team in Australia and Asia in the early 2000s.

More recently, Mr Johnston was the President and CEO of TSX-listed Nautilus Minerals, where he managed the development of the world’s first sea-floor mining company, whose main project was the Solwara 1 Field in the Bismarck Sea, in PNG waters, just northwest of Bougainville.

Kalia has also hired accountant Jonathan Reynolds as a non-executive director.

Mr Reynolds has more than 25 years’ experience across a range of sectors, including a current role as Finance Director with ASX-listed Allegiance Coal, a company focussed on investing in advanced or producing metallurgical coal assets.

Kalia recently sought out one of the world’s leading experts on porphyry, epithermal and “Carlin-style” copper-gold mineralisation, Dr Steve Garwin, to run the ruler over its comprehensive technical data set on Bougainville.

Dr Garwin has been involved in numerous exploration and mining projects, including the Batu Hijau porphyry mine in Indonesia that holds an ore reserve of 9 million ounces of gold and 4 million tonnes of copper.

His recent discovery of the world-class Alpala porphyry deposit in Ecuador is even better, holding about 11 million tonnes of copper and just over 23 million ounces of gold.

Dr Garwin’s review highlighted the geochemically “fertile” nature of the Mt Tore region’s rocks, holding significant potential for multiple copper-gold porphyry centres and epithermal mineralisation, which confirmed Kalia’s belief that it is sitting on some prospective ground on Bougainville.

The investigation unearthed five significant regions of interest on the company’s tenements, including a new unexplored target 60 square kilometres in size, characterised by anomalous copper-gold assays in geochemical stream sediment samples dating back 30 years.

The exploratory overview of the company’s two tenements located at the northern tip of Bougainville also delineated three potential porphyry copper-gold centres and one substantial epithermal gold region bridging the Teosiri – Teoveane areas, for follow-up exploratory field work.

The regional exploration to ground-check the interpreted geological features will be helicopter-supported, given the challenging terrain and the remote locations of individual targets.

Kalia said it would focus its field sampling programs around the key locations, to identify and rank targets for maiden drilling programs in the project holdings, expected to kick off later this year.

The company completed a detailed airborne geophysical survey over its Mt Tore leases in 2018, which threw up 64 individual porphyry and epithermal exploration targets for evaluation.

The style of porphyry copper-gold deposits the company is seeking on Bougainville are highly sought-after globally because they boast some of the largest ore reserves of these desirable commodities.

And it couldn’t reside in a better postcode globally, with Kalia exploring in the “Pacific Ring of Fire” region, which holds many world-class copper-gold porphyry systems and its Mt Tore JV tenements located only 130km northwest of one of them, the gigantic mothballed Panguna copper-gold mine.

Watch this space for developments.

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Bougainville landowners group claims rival a BCL surrogate


Radio New Zealand | 17 July 2019

The Bougainville landowner group, Special Mining Lease Osikaiyang Landowners’ Association or SMLOL, has rejected claims by another group claiming rights around the Panguna mine.

There have been plans to re-start mining as Bougainvilleans contemplate life after the referendum on independence from Papua New Guinea.

A company called the Panguna Development Company has questioned the bona fides of SMLOL to say they represent the landowners at the site of the mine.

But SMLOL said it has the backing of the vast majority of blockholders, that its authority is recognised by the National Court and that its registered office is at the building housing the Bougainville Department of Mining.

SMLOL also said the Panguna Development Company was established just a few months ago by a rival for the re-opening of the Panguna mine, Bougainville Copper Ltd.

A SMLOL spokesman Philip Miriori said Panguna Development Company has just one listed shareholder, Eric Takapau, who he said had since passed away.

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Rival questions authority of Bougainville’s Osikaiyang landowners

“The original divisions from the beginning of the conflict in Panguna #Bougainville have not gone away. Foreign controlled companies continue to involve themselves and interfere which exacerbates the situation. Money continues to corrupt individuals and complicate any resolution” Stret Pasin

Radio New Zealand | 16 July 2019 

The Special Mining Lease Osikaiyang Landowners Association represents itself as the key body at the site of the Panguna mine, which various interests are looking to develop.

Osikaiyang wants to operate Panguna with an Australian company, RTG.

But the Panguna Development Company, which has links to rival prospective operator, BCL, said Osikaiyang is making misleading public statements when it has no right to do so, under the region’s mining act.

It said such statements can only be given by customary heads, who are authorised to represent the Panguna blocks, and Osikaiyang has never had this consent.

Last week Osikaiyang issued an ultimatum, suggesting the referendum on independence from Papua New Guinea could be derailed if it doesn’t get its way over Panguna.

The Development Company called this threat unfortunate.

Meanwhile, government moves to change the Mining Act to allow a third foreign company to take charge of the mine have been put on hold until after the referendum.

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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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