Tag Archives: Chinese mining

Can the law prevail over Chinese investments in Ecuador?

Police and Molleturo communities discuss procedures to monitor the suspension of mining activities. Photo: Manuela Picq

Manuela Picq | Intercontinental Cry | July 25, 2018

Last June, an Ecuadorean court ordered the suspension of all mining activities by a Chinese corporation in the highlands of Rio Blanco, in the Molleturo area of the Cajas Nature Reserve. It was a local court in Cuenca that gave the historic sentence: a court shut down an active mine for the first time in the history of Ecuador. Judge Paúl Serrano determined that the Chinese private corporation Junefield/Ecuagoldmining South America had failed to consult with the communities as required by Ecuador’s Constitution and by the UN Declaration on the Rights of Indigenous Peoples (UNDRIP).

Judge Serrano deemed the mining activity illegal and ordered the corporation to immediately suspend all its activities. Within two weeks, local communities accompanied police forces and local government officials in monitoring that the court order was respected.

The company appealed, and pressure was on the rise for the following hearing. The Chinese corporation privately offered $18 million to community leaders. Ecuador’s President, the Minister of Mines and the Minister of the Environment visited the province to pressure the local courts and indigenous communities to accept the mining activity. They defended “sustainable” mining as a form of development.

Affected communities consolidated their resistance, monitoring the access to the mine to impede mine workers to enter their territories, building support from neighboring communities, and informing the international community of the legal stakes.

On July 23, 2018, the court met again to either ratify or revert the decision to suspend mining activities in Rio Blanco. The court listened to all sides along with some expert testimonies; but there were discrepancies among the judges who postponed their verdict for another week.

Molleturo’s lasting vigilance for their waters

The Rio Blanco mine is located in the Molleturo-Mollepongo region, above ten thousand feet in the Andes. The mining license encompasses approximately six thousand hectares of paramos, lakes, and primary forests that nourish eight important rivers. This area replenishes the water system of the Cajas National Park, one of the largest and most complex water systems of Ecuador, which covers over a million hectares and holds immense water reserves.

The area is recognized as a natural biosphere reserve by UNESCO. These mountains have long been the home of Kañari-Kichwa indigenous communities. There are 12 archeological sites in the Molleturo area alone: the most famous one is the Paredones archeological site, located right by the mine.

The area is also a vital supply of water. These paramos provide water to 72 communities in Molleturo, freshwater to towns in the southern coast of Ecuador and to the city of Cuenca, the country’s third largest city which praises the quality of its drinking water.

The Rio Blanco mine is expected to be active for seven years, removing about 800 tons of rock per day and using cyanide to extract gold and silver. This entails an estimate of one thousand liters of water per hour that would be contaminated with deadly toxic waste, including arsenic, before being thrown back into rivers and soil.

Local indigenous communities were never consulted prior to the development of the project that would benefit from a recent Ecuadorean law incentivizing foreign investment. Nor did they give their consent to the licensing of their territories to the Junefield corporation. They reject the mine because it would contaminate their waters.

Women are at the forefront of the resistance that began almost two decades ago, when the mining license was first issued. Molleturo communities have been arguing in defense of water more or less actively over the last decade and a half but stepped it up when the mine started its activity in May 2018. Protests exploded, and a group burned out the miner’s living quarters.

Nobody was hurt in the explosion, but the police intervened, heavily armed, to militarize the area. The next day, protesters called in the president of Ecuador’s Confederation of Kichwa People Peoples for help, Yaku Perez Guartambel, but workers from the mine kidnapped him for eight hours, threatening to kill him. Tensions boiled to new heights.

Prior consultation as a fundamental indigenous human right

The Judge ordered the suspension on the mine–invoking constitutional and international indigenous rights to prior consultation.

Rosa, a delegate from the Andean Network of Indigenous Organizations (CAOI), discusses the territorial dimension of self-determination to community members gathered in the páramos of the Cajas mountain range. Photo: Manuela Picq

Since 1989, Art. 6 of the International Labor Organization Convention 169 safeguards indigenous rights to prior consultation on projects taking place on indigenous territories. Art. 18 of UNDRIP establishes indigenous rights to participate in decision making relating to their territories, and Art. 19 establishes that states must consult “in good faith” to obtain indigenous “prior, free, and informed consent: about legislative of administrative measures impacting their communities. In 2016, Art. 25 of the American Declaration on the Rights of Indigenous Peoples reiterated these principles in the context of the Organization of American States.

Prior consultation is not a simple law; it constitutes a fundamental human right of indigenous peoples because their existence is intimately tied to their territories. Their culture, lifeways, and community structures are woven into territorial autonomy.

An Amicus Curiae from a Chinese environmental lawyer

About half a dozen amicus curiaes were presented to Cuenca’s court supporting the communities right to prior consultation, from a range of organizations including the Environmental Defense Law Center, Ecuador’s Ecumenic Commission of Human Rights (CEDHU) and the Ecuadorian group Critical Geographies. Amicus were presented by scholars from Ecuadorean and American universities, including Universidad Internacional del Ecuador, Universidad de Cuenca, Universidad San Francisco de Quito, American University, and Coastal Carolina University.

Environmental lawyer Jingjing Zhang, from Beijing, submitted an amicus in which she provided an overview of relevant Chinese laws and regulations. She testified to the court on July 23, 2018, explaining that China ratified the UN Declaration on the Rights of Indigenous Peoples in 2007, thus supporting prior consultation and consent for any project on their territories. She reminded the words of the Chinese delegate at the 13th Session of the UN Permanent forum on Indigenous Issues (2014): “ the international community is duty bound to fully meet the legitimate requests of indigenous peoples, to promote and protect their basic human rights and freedoms, to safeguard the natural environment and resources on which their survival depends” and China “firmly supports the promotion and protection of the basic human rights and fundamental freedoms of all indigenous peoples around the world. ”

She explained to the court that China has regulations establishing that enterprises may not violate international treaties ratified by the Chinese government and that they are bound by the laws and environmental regulations of the host country. She stated that The Communist Party of China (CPC), State Council, and various government agencies have issued policy guidelines that encourage Chinese companies to focus on ecological environmental protection in their foreign investments. In her view, the Chinese government has deep concerns on the law-abiding and environmental performance of Chinese companies operating overseas.

Her amicus concluded that China’s Environmental Protection Law, Environmental Impact Assessment Law, and the Government Information Disclosure Regulation have strict provisions on the public participation rights of citizens. These regulations are based on the same principles and contain similar provisions to the Ecuadorian norms on the rights of indigenous peoples to prior consultation.

One step forward or two sets back?

The court sentence to suspend the mine marked a milestone of hope to Indigenous peoples and nature defenders. Yet the old tactics of legal warfare are still in use. Within a week of the court sentence, over 20 nature defenders were criminalized, eight of them charged with the crime of sabotage.

The private corporation Junefield/Ecuagoldmining South America did not have to do engage in public debate, Ecuador’s government is taking the lead. It was the Ministry of the Interior who accused indigenous peoples to defend the interests of the Chinese corporation. “The state proves that it is the best lawyer of mining companies,” says Yaku Perez Guartambel.

Will the criminalization of nature defenders continue? For now, judges are holding off a final verdict, and as the clock ticks political and economic pressures thicken. Molleturo leader Fausto Castro says that communities want their right to life back, and that they seek a peaceful solution to this mining conflict. It is indeed an achievement that serious confrontations were avoided, but this may not last forever. Yesterday, when the Judge staved off sentence as hundreds of nature defenders awaited outside the courtroom, many expressed their fears: “if the court reverts its sentence to benefit the State, it is a declaration of war.”

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Basamuk People Threaten To Shut Down Ramu Mine Refinery

View of the Ramu Nickel mine refinery. Image by Christopher McLeod/Sacred Land Film Project.

Jayne Safihao | Post Courier | 6 July 2018

While deputy Prime Minister, Charles Abel and a large team of government officers arrived yesterday in Madang for the much anticipated royalty payment to those affected in the Ramu Nico project, neglected Basamuk landowners have threatened to shut down the Basamuk refinery on Monday.

The threat was issued to the Ramu Nico management yesterday by executives of the Basamuk Landowners Association, in what was a ‘strained meeting’.

Spokesman and activist in the fight against having the deep sea tailings placement in Basamuk, Sama Mellombo, spoke strongly against the Mining Resource Authority (MRA), saying it had no legitimate powers to negotiate royalty payments.

He said that the Lands Department made an Improvement Inspection Report in 1999 which stated that the land should be forfeited and given back to customary landowners to improve.

Mr Mellombo said this was before the Mining Lease 42 was granted, “as described as to the depth of 30 metre below the natural surface of land situated near Basamuk”.

“Basamuk land is exempted from compulsory acquisition. Since the first Lands Titles Commission hearing in 2011 there has been no decision made over the land title. So after two LTC hearings no one can claim the land. We’ve had to go to the National Court to sort ownership issues but the courts say they are not the proper authority to decide who owns the land. It’s been a volley between the courts and LTC since,” he said.

“Now who has given MCC, the Chinese developer, the Basamuk land?”

MCC spokesperson, who did not want to be named, confirmed the meeting with Mr Mellombo’s team saying that the issue of Basamuk landownership was an “in-house dispute” between factions of landowners which has been prolonged and has put the company in an awkward position.

“The company can go ahead and pay them outstanding land use payments and such but this is hindering us. We recognize Mellombo as an LOA chairman though,” he said.

Mr Mellombo when asked if this was an in-house dispute, scoffed the idea saying:

“There is no in-house matter because according to MOA review of 2013, doesn’t allow two associations in one area. The company and the government are playing games and interfering with LOA affairs which they have no right to.”

The recognised groups within the project area to benefit today are Maigari Inland pipeline, Coastal pipeline and Kurumbukari LOA groups excluding the Rai Coast people in Basamuk.

It seems while the in-house matter is yet to be sorted out and LTC, yet to decide land ownership, the Chinese have somewhat put a refinery and Deep Sea Tailings Placement.

Mra Officers Allegedly Mishandling Landowners Issues

Jayne Safihao | Post Courier | 6 July 2018

The alleged mishandling of landowner issues by concerned MRA officers (named), in one of the impact areas of the Ramu Nico project may lead to the possible closure of the refinery at Basamuk.

In a petition, chairman of the Baasamuk Landowners Association Sama Mellombo, had singled two MRA officers as being very biased, not properly organising quarterly meetings and giving a complete blackout on project developments to the Basamuk LOA.

“I call on the Governor of the province, MPs for Madang and Rai Coast to get rid of these two gentlemen as they are not doing what they are supposed to be doing. MRA has not been paying our grants since, despite a competency jurisdiction hearing by the courts recognising us. These two gentlemen have been taking sides with certain individuals, coming to Madang and using it as a holiday resort and playing smart,” he alleged.

In the petition, he gave the company 48 hours before the refinery is shut down unless both men are replaced forthwith; that the refinery landowners identified by the Department of Lands and Physical Planning in 1999 be served on the proprietor, fully supported by a study of the Yangonan People of Rai Coast 1999 sponsored by Highlands Pacific and National Court order 2005/2010 regarding the subject land; and that the state show proof that Basamuk ground identified by Survey File No, 12/257 was legally acquired.

“We have been reliably informed that one MRA officer had a meeting to brief all the chairmen and executive committees of KBK, Inland and Coastal LOAs and singled out a Willie Galuk for reasons known only to himself. Who does Galuk represent? Not Basamuk I hope,” he said.

“We are concerned because this is not the first time the two officers have deliberately avoided Basamuk LOA executive committee since the outcome of the appeal to the National Court seeking to set aside the court order declaring that the election facilitated and conducted in Mindire village in 2016, was illegal.

“The landowners of Basamuk have been denied natural justice caused by these two officers who fail to remain impartial at all times when it comes to landownership issues. They see fit to be personally and deeply involved in the affairs of Basamuk LOA in-house matters that is causing the current status quo.

“Their actions are not in the best interest of the National Government through MRA and Ramu Nico management as they have failed to ensure four LOAs in the Ramu Nickel\Cobalt project has legal standing in the MOA; failed to conduct due diligence to ensure when conducting elections for associations over the years made sure of legal and statutory requirements according to association extract provided by the IPA for each term.

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China looking under the sea for opportunities in the Pacific

Denghua Zhang* | East Asia Forum | 30 June 2018

China has hunted globally for land-based mineral deposits to fuel its economic development since the 1990s. Now, Beijing is devoting growing attention to seabed mining. As China’s Five-Year Plan on Mineral Resources (2016–2020) states, ‘China will actively participate in international surveys on deep sea mining and accelerate the exploration and development of ocean minerals’.

In the Pacific islands region, most countries are small in land area but have huge maritime exclusive economic zones (EEZs). Chinese enterprises have invested in seven land-based mining projects in Papua New Guinea (PNG), Fiji, New Caledonia and the Solomon Islands and have been interested in mining the Pacific’s seabed minerals since 2001.

China’s engagement with the Pacific on seabed mining started with research activities that have mainly been carried out by the China Ocean Mineral Resources Research and Development Association (COMRA). COMRA is affiliated with the former State Oceanic Administration, which was absorbed into the new Ministry of Natural Resources in March 2018.

The Qingdao Institute of Marine Geology has conducted many of COMRA’s research projects in the Pacific. Between 2001 and 2010, the Institute completed two research projects on China’s bilateral cooperation in ocean resources exploration and on seabed mineral resources in the South Pacific. Their research categorised marine areas as prospective sources of polymetallic nodules, cobalt nodules and hydrothermal sulphide deposits, and also compiled a seabed mining resources map of the Pacific. The research team suggested that China should incorporate seabed mining into its aid plans for Pacific states and use concessional loans to support exploration projects.

Based on these research activities, Chinese government agencies have directly reached out to their Pacific counterparts. In April 2013, a joint delegation comprised of officials from COMRA and Chinese mining institutions visited the Cook Islands, Fiji and Samoa and expressed their strong interest in exploring seabed mining in the three countries. In August 2014, Chen Lianzeng, Deputy Director of the China State Oceanic Administration, visited Vanuatu and Fiji and proposed that China and the two countries should strengthen cooperation on maritime resources exploration and development. Vanuatu’s then-prime minister Joe Natuman and Naipote Katonitabua, the acting permanent secretary of Fiji’s Office of the Prime Minister, responded positively to China’s suggestions.

China’s state-owned enterprises (SOEs) are also involved in seabed mining. Mawei Shipbuilding Limited, a Chinese SOE located in Fujian Province, is building a US$18 million seafloor production support vessel for Toronto-based Nautilus Minerals. The vessel was launched in March 2018, with approximately 75 per cent of it completed. It will be used for the Solwara 1 project — the world’s first seabed mining project, located in the Bismarck Sea off PNG.

The three seafloor production tools to be used in the Solwara 1 project were designed and built by the UK-based Soil Machine Dynamics Ltd. In April 2015, Soil Machine Dynamics Ltd was sold to Zhuzhou CRRC Times Electric Co, Ltd, which is an SOE ultimately owned by the State Council of China. The products from Solwara 1 will be processed by Tongling Nonferrous Metals Group — another Chinese SOE. In May 2017, China Minmetals Corporation and the International Seabed Authority (ISA) signed a 15-year contract that allows China to search for polymetallic nodules in the 72,745 square kilometres of the Clarion–Clipperton Fracture Zone in the Pacific Ocean.

Seabed mining in the Pacific is attracting interest from other foreign players. For example, Japan and Russia have brokered ISA contracts to explore cobalt-rich crust resources in sites close to the EEZs of the Marshall Islands and the Federated States of Micronesia.

Seabed mining is both an emerging field and one that is in a considerable state of flux. As shown by the proposed Solwara 1 Project, this new industry faces unprecedented financialenvironmental and social challenges. There are also notable gaps in the international and national laws that govern seabed mining. The International Seabed Authority is still in the process of developing a ‘Mining Code’ to regulate the prospecting, exploration and exploitation of seabed minerals. As of late 2015, only four of the 14 Pacific states (Palau, Tonga, Tuvalu and Nauru) have legislation that covers seabed mining issues. The PNG government is still developing a draft offshore mining policy.

Greater China–Pacific engagement on seabed mining has upsides and downsides. Pacific states have flagged seabed mining as a new potential driving force of economic growth. PNG, Fiji, Tonga and the Solomon Islands are among the first countries in the world to issue exploration licenses for seabed mining in their EEZs, and Pacific states might be able to seek more financial and technical assistance from China to develop this new industry. But any such project needs to consider the environmental and social impacts of seabed mining and must fully comply with international and national laws.

Looking into the future, China is expected to engage actively with Pacific states on seabed mining and focus on exploration and establishing official contacts. But China is unlikely to commit substantial resources to seabed mining projects before the industry becomes more commercially and environmentally viable.

*Denghua Zhang is a Research Fellow at the Department of Pacific Affairs, The Australian National University.

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China extends gas interests in Papua New Guinea

Once again Papua New Guinea’s rights and resources traded internationally with no government oversight or landowner consent… 

Repsol sells permits in Papua New Guinea

Rick Wilkinson | Oil and Gas Journal | 21 June 2018

Spanish firm Repsol SA will sell its exploration and development permits in Papua New Guinea to Chinese company Balang International. Repsol has not disclosed the transaction amount.

The nine permits—four exploration and five development—have been in Repsol’s portfolio since 2015.

They include 25% of offshore retention license PRL 38, which contains the Pandora gas fields in the Gulf of Papua, along with 35.1% in the Elevala-Ketu gas-condensate fields in retention license PRL 21, and the Stanley gas fields in nearby development license PDL 10.

Repsol acquired the assets as part of the package when it bought Talisman Energy Inc. for $13 billion in late 2014.

Repsol said the business in Papua New Guinea will continue to be operated by Repsol until the transaction is completed during this year’s fourth quarter.

Balang is part of the China Changcheng Natural Gas Power Group, which has investments in natural gas and power across China and the Asia Pacific region.

Balang Chairman Dai Ying Xiang said his company is committed to the development of the discovered resources within the permits which have the potential to foster and supply a new Papua New Guinea LNG project.

Development could include contributing gas to the proposed 1.5 million-tonne/year Western LNG project, which involves a processing facility near Daru Island on the coast near the mouth of the Fly River.

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Time PNG govt exercised better control over its own resources

A Britten Norman Islander, the first plane to land at Frieda River in 1970. Kiap John Pasquarelli had discovered gold and copper in 1963. Now, 55 years later, the mine is still undeveloped and the object of great controversy

Gabriel Ramoi | PNG Attitude | 12 June 2018

Resources firm Pan Aust (wholly owned by the Chinese state company, Guangdong Rising Assets Management, GRAM), has lost its way with the Frieda River copper-gold project in Papua New Guinea’s Sandaun Province.

It is now time for the PNG government to exercise leadership and rein in control over the Frieda asset if the PNG is to sustain its free education and health policies and lift the rest of the country out of poverty, disease and ignorance.

The view from Frieda is now very different compared with the corporate carnage of 2013 following Glencore’s hostile takeover of Xstrata Mining. In that epic battle for world copper supremacy, Mike Davis’s Xstrata lost to Ivan Glasenberg’s Glencore and with it went a chunk of PNG’s national asset, the K260 billion Frieda mine.

Glasenberg has gone on to become the king of copper and head of the number one mining house in the world.

But then, for a deposit of just K80 million, little known Australian miner Pan Aust Ltd moved in and acquired Frieda from Glencore while PNG government advisers and ministers slept on the job despite warnings from industry that the government should exercise control and reclaim ownership over its strategic asset.

Pan Aust went on to the sell out to GRAM in 2015 for a reported K1.2 billion although officially the deal was closed at K450 million.

GRAM is owned by the municipality of the city of Guangzhau in southern China, although the deal maker in this transaction was a leading Australian Chinese billionaire Dr Chau Chak Wing, the subject of a current controversy because of allegations that he is an agent of the Chinese Communist Party.

Additionally, the influential South China Morning Post reported in September last year that the chairman of GRAM, Li Jinming, as well as the CEO and chief financial officer had been arrested and are facing prosecution in China for failing to account for a number of acquisitions made by GRAM in Australia, including Pan Aust, leading to a loss by GRAM of more than K3.2 billion.

None of these corporate maneuverings went unnoticed by the government of China and eventually Glencore was forced to sell a number of its copper assets to China in order to keep selling its copper ore to the communist country.

I suspect the sale of the Frieda copper mine may have been part of an arrangement between Glencore and the government of China for a number of its assets to be sold to Chinese-controlled companies.

But the question that now needs to be asked in PNG following the arrest of the GRAM directors is what can the PNG government do with Frieda?

Last week, the PNG Mineral Resources Authority reported that Pan Aust had advised it of the withdrawal of an application for the mine development license over Frieda that was filed in 2016.

I suspect the real reason for this is that Pan Aust does not have the required capital to follow through with the development of Frieda Mine since the arrest of the GRAM executives in China and the freeze on GRAM’s activities pending finalisation of court proceedings in China.

Pan Aust and its junior partner Highlands Pacific are already in arbitration over the issue of the costs relating to each partners contribution to the feasibility study.

In the wake of this total mess, an opportunity exists for the PNG government to open dialogue directly with the government of China to revisit the Frieda project.

Already two leading Chinese state companies – China Energy Engineering Ltd and China Railway Yunnan Construction & Development Ltd – have expressed interest in developing the infrastructure associated with the mine.

The PNG government and the provincial governments of West and East Sepik – the ministers of the two provinces in particular – should take the lead in opening dialogue with China on the Frieda project.

How the Frieda project will be developed is part of the unfolding resource war being waged worldwide between private capital (represented by figures such as Glasenberg, Donald Trump and Malcolm Turnbull) and powerful state actors such as the gvernment of China and other savvy emerging states such as Russia and Indonesia.

The leading US-based mining journal Behre Dolbear reported last week that the Republic of Congo, Ghana, Tanzania, Zambia and Mauritania have recently enacted new legislation apportioning greater revenues from mining in favour of the state to the rejection of Barrick Gold in Tanzania and Glencore in Congo.

Over the last six months we have also seen the rise of resource nationalism in Indonesia with a direct challenge to BHP Billiton and Freeport Copper to divest up to 51% of their interest in the Grasberg mine to the Indonesian state.

At the time of writing, BHP has agreed to sell its 40% stake to the state and current negotiations continue on the quantum of compensation for environmental pollution by Freeport.

While there is a much kneejerk reaction by our neighbours about Chinese checkbook diplomacy in the region, it must be remembered that China is Australia’s number one trading partner.

Despite just 70 years ago China being rolled over by Japan after a long period of being pushed around by colonial powers, it has emerged in recent times as a super power extending its hand of friendship to countries around the world as it builds a new world order with itself at the centre.

“Developing countries where 90% of the world lives are at a crossroad,” says the leading black African woman of our generation, Zambian economist, lawyer and banker Dambisa Moyo. “They are facing a choice between the United States model of democracy and private capitalism or the Chinese model of state capitalism and no democracy.”

This may be too unequivocal as many third world countries including PNG are now better poised to consider bartering our copper, gold and other mineral wealth for infrastructures such as roads, ports, railways, universities and hospitals rather than simply allowing private capital through direct foreign investment.

Our experience over 40 years has been dismal as highlighted by reports such as that by Jubilee Australia. As PNG struggles to build its next generation of mines, the young lawyers and technocrats advising our leaders must take it upon themselves not to repeat the mistakes of the past but to look at recent deals between China and a number of counties in Africa and negotiate a new mining development contract for PNG that we all can be proud of.

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MCC Involves Fishermen In Marine Survey

Post Courier | June 8, 2018

RAMU NiCo Management (MCC) Limited undertook a marine environmental monitoring survey along the coastline of Rai Coast district in Madang province recently.

And MCC used local fishermen to provide the reef fish for Ramu NiCo’s corporate health, safety and environment team and an independent consultant Ninkama Yoba and Associates to dissect for tissue samples for laboratory analysis overseas.

The local fishermen from the far-flung coastline of Rai Coast were very happy to be paid a sum of K300 for their catches which were stored in eski coolers provided by the Ramu NiCo team.

Group leader of the Saidor fishermen, David Lopez, thanked the Ramu NiCo HSE corporate team for their trust in allowing them to fish to supply catches for the survey.

“We usually catch fish to enjoy with our families during meals, but to catch fish to supply for the survey is good and also it provided us some money to help us in our remote place,” Lopez said.

From the catches, the fish muscles and liver plus mollusks and crustaceans were frozen, packed with ice and sent to the Australian Laboratory Services (ALS) in Sydney for analysis.

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Frieda Mine Lease On Hold

Frieda River mine camp

Frankiy Kapin | Post Courier | May 31, 2018

Frieda mine project developer PanAust Limited has indicated further alterations to its initial proposal for mine development thus holding back the Special Mine Lease (SML) application.

Mines regulator, Mineral Resources Authority (MRA) revealed this week that the assessment of the application had to be put on hold as the applicant has indicated there may be significant changes to the initial proposal for development and feasibility study.

According to MRA, PanAust is considering a range of potential material changes.

These include the relocation of the integrated storage facility to Frieda River from the Nina River, and increasing the hydro potential to over 300 Megawatts.

The project is also considering development of a public road corridor between Vanimo and Hotmin instead of using the Sepik River.

“This is to significantly reduce its activities within the river system.

“The proposed airport may be upgraded to a regional status and there may be consequential changes to tenements. Some relocation of landowners may also be required,” said the MRA.

MRA confirmed that PanAust’s application for a SML for the Frieda project is on hold pending the company’s lodgment to the government indicating amendments to the development proposal.

According to MRA, the tenement holder initially lodged the SML last year in June 2016 but has indicated to the State negotiating team that it may submit an amended proposal for development and feasibility study by October this year.

“Mining Act and Environment Act approvals will be delayed as a result against the original timetable.

“To date, PanAust has yet to submit its amended proposal two,” MRA issued.

MRA further stated that PanAust will also be required to lodge any amended environment impact assessment report to the Conservation Environment Protection Authority (CEPA) if the original proposals alter.

East Sepik Governor Allan Bird said as the host province, the provincial government will have a say once all mine development documents are assessed by MRA and submitted to the provincial heads.

The Frieda River project is copper dominated with gold and silver as bi-products and presently the project’s mine life is 17 years with a potential to extend.

Current indications from initial submissions are that the porphyry copper gold deposits contain an estimated total combined mineral resource of over 2.7 billion tones at an average grade of 0.42 per cent copper and 0.23 grams per tonne gold.

From this assessment, the project has a total mineable ore reserve of 608 million tonnes at 0.49 per cent copper and 0.27 grams per tonne gold.

The Frieda River project operator is Frieda River Limited (FRL), a subsidiary of PanAust.

Frieda River Project is located in the provinces of West and East Sepik and jointly owned by PanAust (80 per cent) and Highlands Pacific (20 per cent).

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