Tag Archives: FIFO

Govt To Review FIFO: Minister

Gorethy Kenneth | Post Courier | June 25, 2019

The government will review the fly in-fly out (FIFO) workforce arrangements for foreign workers. This may now put an end to K91 million spent annually on this exercise. Minister for Immigration and Border Security Petrus Thomas announced this yesterday.

Mr Thomas said the Immigration and Citizen Authority (ICA) is now looking at issuing long-term working residence visas by next year which is in line with its organisational reform and improvement of service delivery under its Five-year Corporate Development Plan (2018-22).

The Minister referred to the study carried out by National Research Institute in 1997 on the effects of fly in-fly out on the Porgera mining project which revealed that the PNG economy was losing between K36 million and K91 million annually on direct national income.

He said the Bougainville Copper Mine had successfully maintained a small satellite mining town with classic facilities that were built to accommodate workers for the Bougainville Copper Mine.

“There was sufficient cash flow injected directly into the local communities with high returns gained from the capital investments, he said.

Mr Thomas said these changes to the frequent abuse of the 60-day multiple entry visa by foreigners had prompted him to suspend it last year.

“The multiple entry visa category had been reviewed and will be introduced again once cabinet approves the new conditions, fees and guidelines,” he said.

Similarly, Mr Thomas was of the view that the fly in-fly out practice has also been abused by many foreign em-ployers and contractors after receiving criticisms lately from MPs and concerned landowners of resource project areas.

“The fly in-fly out practice may have worked in some short-lived projects, but the impact of FIFO and contribution to host communities, their social welfare and economy has never been truly assessed in long-term projects,” he said.

Mr Thomas said part of the issue lies in the distant lack of national data. “Various agencies supposed to be integrated to streamline these processes had not succeeded,” he said.

“There was no viable data or studies carried out in the past to justify foreign workers’ fly in-fly outs continuous practice.

“It appears that PNG has been under the notion that the FIFO system works in every particular way and no one bothered to review it.”

Mr Thomas said while the government is embarking on developing few new resource projects like Wafi-Golpu and the Papua LNG Project, it should also be mindful of such fly in-fly out arrangements that could potentially suck opportunities during this thriving economic situation.

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MP Mirisim Supports No Fly-In-Fly-Out for Frieda mine

Matthew Vari | Post Courier | January 23, 2019

Member for Telefomin and Minister for Defence, Solan Mirisim has appealed to the Freida River project developers to seriously not take on the fly-in-fly-out arrangements for mine staff.
Mr Mirisim said this last week during a press conference held alongside Minister for National Planning and Yangoru-Saussia MP Richard Maru and Ambunti Drekikir MP Johnson Wapunai in Port Moresby regarding the Freida River project development.
“That also goes for Freida River project, there is no fly-in-fly-out, there is got to be a township so let the landowners and all the employers comes in to participate in the local economy and communities.
“So let me appeal to the company or developer that there should not be any fly in fly out and there has got to be a township.
“Township we have been planning for a big airport in Green River in the center where the township can be up to the Freida River project township.”Mr Mirisin’s district sits where the project is set to be developed, and his comments on the issue were made on the back of Minister Maru’s stance on the issue that no such arrangement is to take place for the Wafi-Golpu project in Morobe.“We are building a national airport there (Morobe) at the cost of K1.5 billion. It has a city of its own and it will be an anchor development that will complement the airport.“And Morobe and Lae already have the wharf and facilities and I really want to see that, and there cannot be any excuse as far as I am concerned.“Morobe and Papua New Guinea must get maximum benefit from the development of their resources,” Mr Maru commented on the Wafi Golpu project development.

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Maru Supports Morobe’s Stand On No ‘Fly In Fly Out’

Ummm… “The best resource project that I have seen in my lifetime is the Bougainville copper mining project”.

Post Courier | January 18, 2019

National Planning Richard Maru has come out publicly to support the stance taken by the Morobe provincial government to oppose ‘fly in fly out’ arrangement for workers of the Wafi-Golpu project.

This is the first time a very senior member of Government has come out on the issue that has been a critical mainstay of discussions and forums by landowners and leaders alike in the Morobe province.

Minister Maru said if there was one thing that his government was taking away from mineral development, it was learning from previous Governments mistakes to not getting the best deal for the country.

“In this new deals that we want to put together for this country, under the new mining agreement for Wafi Golpu and Freida and even the second LNG project we are going to make sure that Papua New Guinea benefits more than any other resource projects in the past.

“I want place on record, this morning (yesterday) that I support the position taken by the Governor of Morobe and the people of Morobe that there will be no fly in fly out in the Wafi Golpu project.

“As planning minister we are already planning for a township at Nadzap and long term employees for Wafi-Golpu as far as I am concerned must live in Morobe and the income they generate must be used in Papua New Guinea, spent in Papua New Guinea, so we get back GST and the money must re-circulate within our economy,” Minister Maru said yesterday.

He said the situation where all resources are being depleted, all the monies end up in other countries all contribute to current issues being such as foreign currency shortages.

“As planning minister I do not support that, I want to see maximum benefit, families living here better, schools being built with the support of the resource companies, better towns being built.

“I want to say this and I make no apology to anyone. The best resource project that I have seen in my lifetime is the Bougainville copper mining project.

“They not only built a copper mine, they built a town, the best hospital, a supermarket, they provided international schools and all the families who were there and the benefits trickled around Bougainville.”

He said the model of BCL is need in the country.

“This is what will help to keep up the maximum revenue flows within this country and make sure that our country and this people will benefit of the wealth of our resources.”

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PNG mine workers “benefit from FIFO lifestyle” claims industry

PNG Resources | November 26, 2018

A questionnaire by the PNG Chamber of Mines and Petroleum has unearthed a range of benefits that the Fly-in/Fly-Out (FIFO) operating model delivers to PNG workers, their families and the broader community.

Distributed to mining projects with PNG employees engaged under FIFO arrangements, the questionnaire revealed inspiring stories and long-term benefits for employees from across PNG.

Thousands of workers within Papua New Guinea’s mining industry are employed on a FIFO basis, complementing the staff drawn from local communities and host provinces.

Respondents cited a number of benefits of the employment arrangement including:

  • Quality time to spend with their partners, children and extended families
  • Time to take part in community obligations, volunteer at their children’s schools and participate in church and community activities
  • Time to focus on achieving personal goals, including home improvements and starting part-time businesses
  • Opportunities to travel
  • Sufficient time to switch off completely and relax away from the pressures of work

Dr Albert Mellam, executive director of the PNG Chamber of Mines and Petroleum, said the responses also highlighted the financial benefits that FIFO delivers, enabling workers to secure better opportunities for their families, including education and health.

FIFO workers will typically work on a roster such as 15 days at work, then 13 days off; or 21 days on site, followed by 14 days off.  Many PNG mine workers have been participating in a FIFO arrangement for 10 years or more, and express great satisfaction with the FIFO system.

“Our research shows that FIFO workers are in many instances able to achieve life goals in their home communities which would not have been possible in a traditional working arrangement,” said Dr Mellam.

“Importantly, the FIFO employment model provides the best balance of shared benefits to communities right across PNG.

“It enables employees and their families to remain within their own community, rather than permanently relocating to remote areas where the majority of the mines operate. By returning on a regular basis to their families, the economic benefits of mining are spread instead of being concentrated in a single area.”

Senior engineer Joseph Palei of Porgera Joint Venture says as a FIFO worker he is able to spend more time with his family in Lae and use his days off to relax away from the worksite.

“When I return to the gold mine after 14 days, I am more focused and can perform my job to a higher level of safety and diligence,” said Mr Palei.

“Being a FIFO worker has also allowed me to build a home during field breaks and provide better opportunities for my family, including health and education.”

Highly-regarded independent mining expert Richard Jackson recently presented at a Chamber workshop, in which he explained that building a project township for a mine does not necessarily deliver a better outcome for the local community.

“Even from a landowners’ viewpoint, building a project town has some disadvantages. Many of the economic benefits derived from such a township will not accrue to local people unless a great deal of effort is put into planning for them.

“Most resource projects are located in what were previously remote areas whose relative lack of access to the outside world placed very severe restrictions on their potential for trade and economic development. In many cases, despite the construction of roads, airports and other physical forms of communications and despite the arrival of telecommunications, once the project ceases to operate, the basic fact of geography re-asserts itself. They remain remote and at a disadvantage for economic development.

“Building a mining township will provide access to modern services, but only during the life of the mine.”

Mr Jackson said there were several other ways of providing sustainable benefits for local landowners including skills training throughout the life of the project.

“This form of FIFO has a major benefit,” Mr Jackson added. “It means that mine workers spend their earnings in existing towns and villages across PNG and thus spread mining benefits in ways that no government regulations or policies can do.”

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Morobe opposes fly-in-fly-out for Wafi-Golpu mine workers

Wafi-Golpu joint venture mine.

The National aka The Loggers Times | 31 July 2018

THE Morobe government does not want “fly-in-fly-out” for workers for the Wafi-Golpu mine project, says Governor Ginson Saonu.

Saonu said the proposed Nadzab Airport City would cater for the accommodation of employees.

“We are prepared to share whatever land we have to make this happen,” he said.

“We cannot just talk about it. We have plans for accommodation and all facilities that are needed by the employees of the mine.”

Saonu said this when presenting Morobe’s five-year development plan to Planning Minister Richard Maru in Port Moresby yesterday.

Maru said the government would budget for land at Nadzab to be made available to the mining company.

“We would like all the families to be located there, housing estate to be located there and they can easily go up to the mine,” Maru said.

“We want to make sure that Nadzab has a city and supermarkets.

“We must look at water, sanitation and sewerage for the airport.

“We really must have a well-planned development around Nadzab.”

Maru said he had spoken to Lands Minister Justin Tkatchenko about putting a team together for Nadzab Airport City development.

“We are excited about the mine starting up,” he said. “Wafi-Golpu will be a game changer for Morobe.”

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Fly-In-Fly-Out Causing Economic Loss

Post Courier | July 15, 2018

The PNG Resource Owners Federation has countered assertions made by the Chamber of Mines and Petroleum that the fly-in-fly-out employee commuter-based system employed by mining and petroleum projects in PNG is economically “balanced”, compared to the alternative of living on site.

According to the Chamber of Mines and Petroleum, FIFO provides the best balance of shared benefits to communities throughout PNG, not confined to host rural communities.

However, the PNG Resource Owners Federation maintains that it denies host rural communities of much need social and economic benefits.

Citing a 1997 study conducted by National Research Institute (NRI) on the economic impact of the FIFO of expatriate staff of one mining project in PNG, Federation president Jonathan Paraia said using the national income accounting equation, it is estimated that on average, the annual loss of national income is between K5.2 million and K13 million.

And considering the multiplier effect, the annual loss must be approximately K11 million and K29 million.

Mr Paraia said continuation of the FIFO system for a decade will cost the economy, including the multiplier effect, between K110 million and K300 million.

Mr Paraia said the economic benefits that could have been derived from a live-on-site arrangement would be employment in the informal sector, disposable income from FIFO employees, GST and other rates, taxes and fees, banking and financial services and trading, commerce and general business activity at all levels.

“The report further found that it was economically viable to build a township to accommodate the FIFO workers from this particular mine instead of the FIFO system.

“In that time, using the report’s formula, the country must have now lost between K253 million and K690 million over the period of the life of this particular project.

“The number would clearly run into many billions if all projects that practice the FIFO in the country are taken into account,” Mr Paraia said.

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LO Associations Request No ‘Fly-In, Fly-Out’

Mining Minister Johnson Tuke is bulldozing ahead with Wafi-Golpu but will landowners demands be honoured?

Post Courier | 13 July 2018

The Peter O’Neill government is committed to getting off the ground the Wafi-Golpu gold mine project before the year ends, as well is the aspirations of key stakeholders to be met as a precedent to the mine reaching initial production stage.

The two-day Wafi-Golpu development forum ending yesterday in Lae was told.

The main point arising from discussions and presentations between key stakeholders from the government, the landowners and the developer centered on the processes and development stages to the project, as well primarily the benefits and participation of concerned authorities and recognised landowners.

One of the key factors presented to be considered in the Memorandum of Agreement that is deemed to provide a win-win situation to key stakeholder is to put a stop to “Fly In, Fly Out” arrangements.

The three existing government recognised landowner groups of the mine site including the Babuaf, Yanta and Hengambu Land Owner Associations (LOA) share similar notion when it comes to fly in fly out.

President of Babuaf LOA Thomas Nen said it is paramount in this development forum that their stance as a key stakeholder to the project be put forward reminding all parties to the table that Babuaf requested specifically for a mining township that covers no fly-in, fly-outs.

Mr Nen said included are a hydro scheme, hospital and technical training college in the requested mining township.

He said the MOA must consider endorsing the development vision and aspirations of the communities and that both Hengambu and Babuaf have completed and produced their community development plans stemming from the community development forum in which their community’s aspirations and dreams are spelt out.

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Fly in, fly out practice supported

The National aka The Loggers Times | July 11, 2018

THE fly-in-fly-out (Fifo) arrangement for mining and petroleum projects allows economic benefits to be spread across the country, according to the PNG Chamber of Mines and Petroleum.

This was one of several reasons given in a statement to The National from the chamber in response to concerns raised by the PNG Resource Owners’ Federation last week.

The federation’s concerns were based on how project areas were losing out on economic benefits due to this and called on the government to put a stop to it.

“Papua New Guineans make up around 95 per cent of the workforce in mature mining and petroleum operations in PNG,” the chamber said.

“They are employed from the preferred area local communities and the host province, as well as from other parts of PNG.

“This Fifo employment model for the resource industry provides the best balance of shared benefits to communities right across PNG.

“Many of the employees from other parts of the country prefer to live in their own homes, than to take their families to mostly remote and isolated areas where the operations are located.

“Fifo allows these employees to return regularly to their families, which spreads the economic benefits to these parts of the country instead of being concentrated in one area.”

The chamber said Fifo delivered skills-transfer opportunities, drove domestic industry through air links and helped provide a boost to local suppliers, contractors and goods-and-services trade throughout the country.

“Additionally, Fifo helps ensure the resource project does not become a social or environmental burden on the host population,” it said.

“The significant cost of building townships to sustain and support families onsite can be an immense strain on a community, and is not sustainable in the long term after the project closure.

“The Chamber of Mines and Petroleum said host communities of resource developments already enjoy considerable socio-economic opportunities not available to other communities in the country.”

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Australian miners and activists target BHP

BHP-Billiton-Logo

PNG  Loop

BHP Billiton confronted its own disgruntled employees along with environmental protesters at its annual shareholder meeting.

The use of compulsory fly-in fly-out (FIFO) workers at two new coal mines in central Queensland prompted workers from around the country to accuse BHP of destroying families.

The increasing casualisation of the workforce, through the use of contractors on weaker pay and conditions, was also a key focus for miners from Western Australia, NSW and Queensland.

People living in towns near the Caval Ridge and Daunia mines were discriminated against and refused a job, 20-year BHP coal miner and local resident Kev Adams told the meeting.

“I know you have a big job Andrew, but you are damaging our mine and damaging our community,” he told chief executive Andrew Mackenzie.

Locals are left with no certainty about their future, he said.

“You can imagine what that does to children with their parents living in a constant state of anxiety week to week, it’s an absolute fact I see every day in a town called Moranbah that used to be thriving and is turning into a dustbowl.”

The use of FIFO workers was squarely aimed at controlling the workforce, claimed Construction, Forestry, Mining and Energy Union general vice president Wayne McAndrew outside the meeting.

BHP chairman Jac Nasser said he understood the concerns, but Australia had to be globally competitive.

Shareholders were also critical of the company for continually mining uranium in the wake of Japan’s Fukushima disaster, and for producing thermal coal due to its carbon emissions.

BHP executives were repeatedly attacked for the company’s environmental record and contribution to climate change.

“We call on BHP to lead the transition away from dirty energy to clean energy … as the world’s biggest mining company you leave a footprint on people and places and have to be aware and accountable for those impacts,” Australian Conservation Foundation campaigner Dave Sweeney said.

Mr Nasser said BHP accepted the science on climate change and had donated funds to the cause, but would not abruptly abandon coal mining, and said uranium mining could help to reduce emissions.

BHP mines uranium at South Australia’s Olympic Dam, where testing of new heap leaching technology – a cheaper way of processing valuable minerals – was showing promise, Mr Mackenzie said.

However it plans another three years of tests before any decision on expansion, and Mr Mackenzie said any expansion would come with steady growth.

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Foreign mining industry cries foul over PNG asserting its independence

Is this the sort of ‘development’ we want in PNG?

“There’s even a local Brisbane school where kids send up all their used coloured pencils to those in PNG who have nothing.”

HIGHLANDS PACIFIC CEO JOHN GOODING

Dancing around the issue

Anthony Barich | PNG Industry News*

ABOLISHING fly-in, fly-out employment would have detrimental effects for Papua New Guinea’s mining industry, an Australian junior has warned.

While applauding the PNG government’s determination to consult industry ahead of changes to the constitution regarding resources ownership, Highlands Pacific CEO John Gooding warned of potential ramifications of changing fly-in, fly-out rules.

As PNG mining minister Byron Chan had vowed to halt FIFO operations – mostly from Cairns but also from other Australian destinations – for mines in PNG, the PNG Resource Owners Federation said in February that the FIFO scheme had been draining PNG of its economic, social and infrastructure benefits.

“There’s a bit of a push for less FIFO and many thought that refers to ex-pats, but if you look at PNG, a lot of people fly into the project then fly back to their provinces when they’re not working. So the FIFO concept is something that, if it didn’t happen in PNG anymore, would completely change the whole complexion of the place,” Gooding said.

Highlands Pacific is involved with the Frieda Copper, Ramu Nickel and Star Mountain operations in PNG, with additional exploration.

However, PNG’s parliament approved dual citizenship in February, which will enable those born in Australia living in PNG, or vice versa, to travel and do business far more easily between the two countries.

The PNG government earlier this year published in the National Gazette the constitutional amendments related to the ownership and exploitation of PNG’s hydrocarbons and minerals.

These changes are part of the O’Neill government’s Kumul consolidation agenda, which it announced last year. In relation to resource ownership, the government will elevate to constitutional status the state’s ownership claims.

Two sections (212B and 212C) will be added to the constitution. The first of the new sections states that: “All hydrocarbons and minerals in their natural state are and always have been the property of Papua New Guinea.”

The second section referred to as “the consolidation and commercialisation of PNG’s business” sets the constitutional basis for the organic law creating the Kumul Holdings structure.

The state’s ownership says that by elevating to constitutional status, it is hoped claims of resource ownership by local landowners will be put to rest.

While Gooding welcomed the consultation process for the Mining Act changes, he warned of potential difficulties implementing it due to the diversity of languages and remoteness of many communities.

He said mining companies, already active in consulting with communities from the start, even before they even start an operation, had been helpful in gaining locals’ trust to alleviate some of these issues.

“There are some parties that are saying that if this is their land, they own everything to the centre of the earth, including the mineral wealth, and the government is saying – and rightly so – that natural mineral wealth is there for the whole of PNG, not just the people that camp on top of it,” Gooding said.

“You need to understand, PNG has 800 different language groups, and as many different tribes or communities that are very isolated, so it’s all about land ownership. So some people have trouble with that concept that the resources are there for the national good.

“Where we are operating is a pretty isolated area, so we’ve provided water reticulation for the village and built a new health centre and provided education for the kids.

“There’s even a local Brisbane school where kids send up all their used coloured pencils to those in PNG who have nothing.

“We provide medical services and emergency evacuation services when required.

“It really is about being a good neighbour. You need to do it from when you first get there, or even before you even get there until the last day that you’re there, it’s a responsibility we have to help these people as much as we can – and they help us too.

“You try to provide training, education and skills that people can take into the future, which is really important.”

Frontier Resources managing director Peter McNeil also sees a potential issue if any changes are made to equity arrangements.

“I’ve had a lot of time in-country, it’s a good destination – so long as the PNG government doesn’t try to change the amount of equity they can gain for sunk costs in the end, which is 30%,” McNeil, who has been working in PNG since 1985, said.

“If they try to change, that equity level will kill juniors, because the 20% level that’s the difference between the 30% and the 50% – that’s the bit that I work for. Any big company is going to want to at least be on equal terms with the government in a major project.”

McNeil also supports the government’s efforts to sort out land ownership issues.

“If this change assists in dealings with landowners, which it must, then it’s enshrined in the constitution. I imagine they’ll still allow the alluvial resources (non-mechanised) to be owned by landowners, because they’re panning on their own properties,” McNeil added.

McNeil first went to PNG as a student in 1981 when his father, an exploration geologist, was general manager PNG for Esso Minerals, establishing the Misima gold project.

“They spent tens of millions in five years doing a lot of grassroots exploration,” McNeil said. “The next challenge there will be when you start chasing the second-order anomalies in the exploration space in PNG.”

* Published in the August/September 2014 PNG Report magazine

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