Community groups accuse PNG government of keeping documents for its approval under wraps
Helen Davidson and Ben Doherty | The Guardian | 11 December 2017
A controversial experimental deep-sea mine is being challenged in court by environmental groups who have accused the government of withholding key documents about its approval.
Nautilus Minerals Inc, a Canada-based company primarily owned by Russian and Omani mining firms, wants to extract gold and copper deposits from 1.6km below the surface of the Bismarck Sea, using a seabed mining technique never before used in commercial operations.
Nautilus told the Guardian it has conducted dozens of community meetings – reaching more than 30,000 people from nearby islands – and has had its key documents, including a detailed environmental impact statement, publicly available for years.
But members of nearby communities, represented by the Port Moresby-based Centre for Environmental Law and Community Rights Inc (Celcor), claim they were not adequately consulted and that they hold grave concerns over its impact.
There are also concerns over its financial viability and the PNG government’s stake in it.
Celcor, which has been assisted by the New South Wales Environmental Defenders Office, formally lodged an application in PNG’s national court and served the PNG government last week.
It said key documents had not been published, and that under the PNG constitution affected residents had a right to the information.
The plaintiffs have previously sought documents including the original permit, the environmental management plan and independent reviews, all oceanographic data on the site, and any studies or modelling of the environmental, social, health, culture and economic impacts.
They had also asked for any agreements made between Nautilus and the PNG government or other entities in relation to the project, and evidence of the mining minister’s original granting of the exploration licence and his reasons.
“Our major concern is the environmental impact of this project, since there is no independent environmental study,” a plaintiff, Jonathan Mesulam, from PNG’s New Ireland Province, said.
Mesulam criticised the company’s consultation approach, and said the community at large did not give “free, prior and informed consent” on the company’s permit.
“They had no control. It has been organised by the former minister, and a few other people from the local level government,” he said.
The Solwara 1 field, in a volcanic area between the islands of New Britain and New Ireland, was identified by Australia’s CSIRO in 1996. Nautilus was granted an environmental permit for the field in 2009, and a mining licence in 2011.
Seabed mining – which Nautilus described as “the next big disruptive technology” – is usually based around areas of metallic nodules, or active or extinct hydrothermal vents, which carry valuable metal deposits.
The proposed process uses machinery previously used in other mining industries to excavate materials from the sea floor, then draw it up to the surface as seawater slurry. The slurry is then “de-watered” and transferred to another vessel for shipping. Extracted seawater is then pumped back down and discharged close to the sea floor.
Critics have said the environmental impact assessment is insufficient as it does not include a “rigorous risk assessment” or an environmental management plan.
“The mining process would generate plumes of sediment, and our critique of the EIS is that there is not sufficient scientific research or modelling done by Nautilus on what would be contained in those plumes,” said Dr Helen Rosenbaum, coordinator of the deep-sea mining campaign.
“Our reviews all show there are significant gaps in the document. The gaps are big enough to render the EIS not fit for purpose.”
Nautilus says the Solwara 1 deposit – Solwara means “salt water” in Tok Pisin – contains high grade copper and gold deposits, up to 10 times higher than typical grades for land-based mines, and has the potential to yield “far superior” ore to mines on land with far less impact on the environment and those who live nearby.
The chief executive of Nautilus Minerals, Michael Johnston, said seabed mining did not require large pits to be dug and created no waste, and the company had carefully modelled the impact of mining on the sea floor. He said there was no impact on fishing because the mining took place more than 30km offshore and far from reef fishing areas.
Johnston said the company has run public meetings every two years, reaching more than 30,000 people, on the progress of the project and the modelled potential environmental impacts.
He said the project had “broad and strong public support” and across all levels of government, and opposition was being led by “a handful of … professional activists”.
“You always get one or two people who jump up and down,” he said. “Some people think if they make a lot of noise, they’ll be given money to go away, and we don’t do that.”
Johnston said Nautilus had helped in developments on New Ireland island, bringing toilets and running water to 25 schools, and working with health organisations running vaccination programs.
He said the company had been transparent with all the information on the project, and he was “struggling to know” how they could be more open.
“Our EIS has been on our website since April 2009, and the executive summary has been translated into Tok Pisin,” he said. “It’s with the conservation and environment protection authority offices in Port Moresby for anybody to see, and we will happily print out copies for anyone who wants one. Anyone who is sceptical about the project, we are happy for them to contact us and we’ll talk them through it.”
There have been long-running concerns about the experimental project, including a 2012 petition with more than 20,000 signatures from the residents of the Madang, Oro and New Britain provinces calling for it to be stopped.
In 2016 the then PNG attorney general and minister for justice, Sir Arnold Amet, rejected the “Papua New Guinea-pig” project, which he said was approved under the Mining Act and without an adequate regulatory framework.
“We are a developing nation, we don’t have the capacity, we don’t have the resources … There is not a tenable argument that says we ought to be used as an experimental locality,” he told the ABC.
In 2016 Oregon State University scientists discovered that hydrothermal vents and methane seeps were emerging as “a major force in ocean ecosystems, marine life and global climate” but were under threat from human activity, including seabed mining.
In June, Blue Ocean Law and the Pacific Network on Globalisation said that compared with industries with a proven track record of sustainability, seabed mining was “a gamble”, risking potentially irreversible environmental impacts and destruction of local fisheries.
Beyond the legal challenge, the Solwara 1 mining venture has also been plagued by financing issues and delays, including a three-year dispute between the company and the PNG government over the equity agreement.
In 2013, arbitration found PNG had breached the agreement, which had previously been described as “high risk” and “low return”, according to a report by Blue Ocean Law and the Pacific Network on Globalisation.
The PNG’s current stake, held by a government company, is 15%, financed by a loan from the Bank of the South Pacific.
Last week the opposition spokesman on treasury and finance, Ian Ling-Stuckey, called for an end to “silly investments best left to the private sector”, labelling the US$113m Nautilus deal a “foolhardy investment”.
Nautilus told its AGM this year “there is increased uncertainty and economic and technical risks of failure associated with this production decision”, and that it required significant additional funding to advance production.
This month Nautilus issued a statement to the Toronto Stock Exchange warning of cashflow and financing difficulties, deferring for a third time its due date for a required $10m funding injection.