Tag Archives: Fiji

Fiji govt needs to ensure people understand environmental impacts of mining

Peter Loy Chong. Photo: Pacific Theological College

“The majority of the people are not aware of the full consequences of mining, logging, stone extraction, black sand mining and how these will impoverish their food bank,” he said.

Fiji govt needs to walk the talk – archbishop

Radio New Zealand |10 October 2018 

The Fiji government should ensure environmental policies at home reflect the climate messages it promotes abroad, Fiji’s Catholic archbishop says.

Prime Minister Frank Bainimarama has been championing the fight against global warming as president of the current UN climate round, the COP23.

But the archbishop, Peter Loy Chong, said the government’s policies needed to be consistent with the proposals it touted during COP23.

Current government policy did too little to protect landowners, the archbishop said.

The government needed to ensure landowners fully understood environmental impacts when negotiating contracts for activities like mining.

“The majority of the people are not aware of the full consequences of mining, logging, stone extraction, black sand mining and how these will impoverish their food bank,” he said.

“It will have an implication on the shores on which they rely for food.”

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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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Fiji landowners query royalties

Luke Rawalai | The Fiji Times | 29 June 2018

WHILE Government has reassured resource owners that they will continue to receive 80 per cent of royalties from the use of their resources, landowners of Nawailevu, Bua, are still querying about funds promised to them for the mining of bauxite on their land.

Nawailevu landowning unit spokesman Waisale Kaidawa said they were still waiting for the royalties promised to them.

Mr Kaidawa said as owners of the land from which bauxite ores were being mined, they were still not clear on when they would receive these royalties.

“It is still not clear with us where these funds are and when it will be released to us,” he said.

“Government, in this year’s budget, needs to hold awareness to us on where this money has gone because we have projects awaiting funding from these royalties.

“It is only fair that resource owners like us get clarification on where this money is being used and how.

“To this day, we are still waiting for word on the Future Generation Funds that we were promised — no word has come to us.”

In his budget announcement last night, Minister for Economy Aiyaz Sayed-Khaiyum said 80 per cent of any royalties for any minerals mined from land and the seabed goes back to resource owners.

“Of course as introduced this year, 80 per cent of any royalties for any mineral resources mined on land and any seabed in Fiji goes straight back to resource owners,” he said.

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The Next Gold Mine in Tropical Paradise Obtains $40 Million Financing

Lion One Drill Pad, Tuvatu

Two projects on a mining-friendly tropical island are moving forward, one in the final ramp-up to production and one at a very early stage.

Streetwise Reports  | 12 June 2018

Thoughts of Fiji conjure up the tropics, beaches and sunshine, but the island nation is also noted for its mineral production. The Vatukoula mine, in operation for over 80 years, has produced more than seven million ounces of gold.

Vying to join its ranks on the politically stable and mining friendly island are Lion One Metals Limited  and Thunderstruck Resources Ltd., two companies at opposite ends of the spectrum.

Thunderstruck Resources is an early stage exploration company with an extensive portfolio of properties on Viti Levu, the main island of Fiji. The company is conducting exploration activities at its large land package—covering 4% of Viti Levu—of “100% owned high grade zinc, copper and gold assets,” it reported in mid-May. According to Thunderstuck, it is “building on extensive prior results that point to the potential for large mineralized systems.”

At the end of May, Thunderstruck closed an oversubscribed private placement, raising over $200,000, selling 2.2 million units at $0.09 each. Each unit contained one common share and one share purchase warrant, with the option to buy a common share for $0.15 until May 2021.

Lion One’s 100%-owned Tuvatu project is at a much more advanced stage and is on track to put into production Fiji’s next mine. The company just announced a US$40 million debt financing package to develop the mine and build a processing plant for its fully permitted project. The financing is with Sinosteel Equipment & Engineering Co. Ltd. and Baiyin International Investment Inc. Sinosteel will be the EPC (Engineering, Procurement and Construction) contractor for the project, and Baiyin will be the gold doré offtaker.

The agreement is for a five-year term at a 7.5% interest rate. There will be a principal holiday and capitalized interest for either the earlier of two years from first draw, or three months after achieving commercial production. There also will be a Net Smelter Return (NSR) royalty of 2.25% on the first 350,000 ounces of gold produced. There is also an option to increase the financing by US$10 million.

Analyst Derek Macpherson of Red Cloud Klondike Strike Inc. noted on June 4 that with the debt financing in place, Tuvatu construction is expected to ramp up and views this as “very positive.”

Macpherson also noted that the “PEA (2015) outlines initial capital investment (excluding working capital) for Tuvatu at US$48.6M. With exploitation permits in-hand and C$21.6M (US$16.6M) in cash, the company is well positioned to continue on the path to construction and production.”

Analyst Mike Niehuser of Scarsdale Equities wrote on June 6, “The PEA assumed modest capital costs and efficient mining of high-grade gold resources, resulting in significant cash flow, which may rapidly repay capital and fund mine development and additional exploration of prospective gold targets.”

Niehuser also stated, “We expect that Lion One will announce an updated capital cost budget that should be within expected variances of the PEA. It appears that the facility should be adequate to cover the construction and capital costs with cash on hand. The terms appear to be competitive and do not include hedging or prepayment fees. Lion One continues exploration activities for which we believe could be a long-lived mine.”

Scarsdale Equities maintains a Buy rating and a target price of CA$1.40 on Lion One, which is currently trading at around CA$0.63.

While Lion One has been securing financing for the project, it also has continued exploration activities. Following the release of an off-the-charts surface sample of 502 g/t gold over 0.70 meters in February, on June 7, the company announced that follow-up work has mapped “more than 20 previously undefined mineralized structures at the Jomaki-Ura Creek prospect areas and identified potential geological extensions on the main mineralized zones inside the Tuvatu Mining Lease.”

Stephen Mann, Lion One’s managing director, stated, “In the Tuvatu resource area, approximately half of the 40 veins identified to date have sufficient sample data from drilling to merit inclusion in a resource estimate. We’ve now identified more than 20 mineralized veins at surface in the Jomaki-Ura Creek area where strong multi-element anomalism suggests potential scale and signature comparable and possibly larger than the main resource area at Tuvatu.”

Lion One has about 102 million shares outstanding, 109 million fully diluted. Management owns 22% of the shares and Donald Smith & Co owns 14%, Franklin Precious Metals Fund 9.99% and JP Morgan Asset Management UK 6%.

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Fiji Ministry to investigate creek slip

Minister for Waterways Dr Mahendra Reddy inspects drainage at Dreketi Irrigation area. Picture: SERAFINA SILAITOGA

Serafina Silaitoga | The Fiji Times | 5 June, 2018

THE Ministry of Waterways will investigate possibilities that mining or roadworks may have caused portions of soil to slip into a creek in Dreketi, Macuata. In an interview with this newspaper, Minister for Waterways Dr Mahendra Reddy said he would speak to stakeholders regarding this matter.

Dr Reddy described such a situation as a continuous problem his team would face if nothing was done now.

“We can desilt the drain, clean the culverts but if the surface run-off is continuous then it will be a continuous problem,” he said.

“So we will talk to stakeholders about this issue and there are a lot of issues regarding other ministries which we need to attend to.

“The Ministry of Agriculture is a major stakeholder we need to consult following farming issues that affect our waterways.”

At the affected creek, Dr Reddy also explained to his team that any works done in the waterway areas needed to be made known to his ministry.

Dr Reddy, who visited the North last week, assured farmers that their grievances regarding waterway issues would be dealt with effectively by his team.

He told farmers that their concerns and complaints would not sit with his team in the office but they would act upon receiving it.

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Lion One Announces US$40 Million Debt Financing for Construction of the Tuvatu Gold Project in Fiji

Acting Prime Minister and Minister for Lands and Mineral Resources Faiyaz Koya (centre) officiates at the groundbreaking ceremony of Tuvatu Gold Mine processing plant civil works. Picture: REINAL CHAND

Lion One Metals | Geology for Investors | June 4, 2018

Lion One Metals Limitedis pleased to announce it has entered into an indicative term sheet with Sinosteel Equipment & Engineering Co., Ltd. of China and Baiyin International Investment Ltd. The term sheet incorporates an EPC and gold doré off-take financing facility totalling US$40 million for mine development and construction of the processing plant for the Company’s 100% owned and fully permitted Tuvatu Gold Project, located near the Nadi International Airport in the Republic of Fiji.

Lion One intends to engage Sinosteel as the project EPC Contractor and Baiyin as the doré off-taker, and be provided with a US$40 million Facility. Closing of the Facility is subject to satisfactory due diligence, board approvals, and final documentation, with closing expected to close in the third quarter of 2018.

Highlights of the Facility include the following key terms:

  • Term of 5 years at annual interest rate of 7.5%
  • Principal holiday and capitalized interest for the earlier of 2 years from first draw, or 3 months after achieving commercial production, followed by 12 equal quarterly repayments
  • Net Smelter Return (NSR) royalty of 2.25% on the first 350,000 ounces of gold produced

Lion One will have the option, subject to mutual agreement, of increasing the principal of the Facility by an additional $10 million with the same interest rate, repayment schedule, security, and pro-rata royalty as the Facility. Lion One will also have the right to obtain a new facility of up to $10 million freely, provided it is not secured against the security under the Facility.

Walter H. Berukoff, Chairman and CEO of Lion One commented “We are pleased to cooperate with Baiyin and Sinosteel for the long-term financing, which will provide low-cost capital and maximum flexibility in the development of Fiji’s next high grade gold project at Tuvatu.”

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Fiji’s mining and quarring industry a problem sector: Dr Gangopadhyay

Mining of bauxite in Bua. The mining and quarrying industry in Fiji has been labelled as a “problem sector” by Australian-based consultant Dr Partha Gangopadhyay. Picture: FT FILE

Mere Naleba | The Fiji Times | 26 May, 2018

THE mining and quarrying industry in Fiji has been labelled as a “problem sector” by Australian-based consultant Dr Partha Gangopadhyay who was hired by Government to conduct a review on the national minimum wage.

Dr Gangopadhyay a Professor in the School of Business at the Western Sydney University made the comments while discussing the 10 sectorial industries at a consultation organised by the Ministry of Employment, Productivity, and Industrial Relations.

“I don’t have to tell you but this is a problem sector by now, most of the mines have been depleted, exhausted. Resources have been taken away or have gone too deep, productivity rate is very slow, productivity growth since last year is 0.5 per cent and our concern is this sector brought a lot of resources, a lot of money to Fiji, a lot of employment, a lot of skill development and today it is a struggling sector,” Dr Gangopadhyay said.

The proposed minimum wage for those in the mining and quarry industries is to have a wage increase by 1.029 per cent.

The current national minimum wage is $2.68.

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