In dramatic policy turnaround, government determines people feel Bougainville Copper Limited doesn’t deserve a social licence to run the controversial mine
Helen Davidson | The Guardian | 10 January 2018
The Bougainville government has enacted an indefinite moratorium on renewing the licence of a controversial mining company over fears it could reignite violent civil conflict.
In December Bougainville landowner groups were called to vote on allowing Bougainville Copper Limited (BCL) to renew their mining licence and potentially reopen the Panguna mine, but the vote was split.
“If we went ahead now, you could be causing a total explosion of the situation again,” the Bougainville Autonomous Government (ABG) president, John Momis, told the ABC on Monday.
The Panguna copper mine was central to the civil war and blockade in the 1990s that killed tens of thousands of people. Conflict escalated after landowners protested environmental damage by the mine and the lack of economic benefit for local people.
The Rio Tinto-owned BCL was forced to close the mine, and discussion in recent years about reopening it has sparked hostilities in the nearby communities.
In June protesters blocked Momis and other political leaders from accessing Panguna to sign an agreement with landowners, which the ABC reported would have opened the way for BCL to work towards returning.
Legislation passed in 2015 gave traditional landowners greater ownership over resources as well as powers over the establishment or reopening of mines, but confusion and division remains.
At the time of the BCL vote local journalist Aloysius Laukai reported Momis said mining by any company would be “untenable” under the circumstances. However on Monday Momis told the ABC the moratorium only strictly applied to BCL, not other potential operators.
The moratorium is a dramatic turnaround in policy from the ABG, which determined people felt BCL didn’t deserve a social licence to run the mine.
The ABG owns a 36.4% share in BCL, and has consistently said reopening Panguna was essential for the island’s economic self-sufficiency if it is to become independent.
Luke Fletcher, the executive director of an Australian-based NGO, Jubilee, said it wasn’t clear if the turnaround was “a temporary retreat or a permanent change of direction”.
“It could be they’re just biding their time for another couple of years, or they’re considering opening Panguna with other operators,” Fletcher said. “It does seem the intention is still to reopen the mine.”
The Papua New Guinea government is the only other major shareholder after Rio Tinto left in 2016. It has said it will give its 17% share to Bougainville, making the ABG majority shareholders of a company that has just one project – a mine over which the ABG has now placed a moratorium.
BCL is yet to be officially informed of the moratorium, but learned of it through media reports.
The company’s Port Moresby general manager, Mark Hitchcock, said it had sought further clarity, as it still “firmly believed” it had strong support among landowners.
“Hitchcock said previously held community forums led by the ABG had also demonstrated strong majority support and this reflected the company’s own experiences on the ground,” a spokesman told Guardian Australia.
“He stressed that BCL was a local company majority owned by the people of PNG, including Bougainville and had always acted in good faith after being invited to enter a new process for the redevelopment of Panguna by the ABG and landowners.”
BCL claimed it had support from eight of the nine landholder groups, as well as the Special Mining Lease Osikaiyang Landowners Association. It said minority elements – and competing mining interests – were disrupting consensus.
There were disputes with the association’s chair, Philip Miriori, BCL said, citing a letter from 367 authorised customary heads who disputed Momis’s characterisation of the vote as a “narrow divide”.
The customary heads told PNG’s Post Courier the meeting was given a submission signed by 320 of the heads giving their support to BCL.
As the resource-rich country moves on from civil war and towards independence, it is increasingly looking to mining for its economic future.
West Australian company Kalia Ltd recently announced it had signed a land access agreement with north Bougainville landowners, allowing the start of a “full-scale exploration program”.