Tag Archives: Newcrest Mining

Harmony admits PNG political instability raises risk of MoU change on Wafi-Golpu

Wafi-Golpu mine site

David McKay | Mining MX | May 30, 2019

HARMONY Gold acknowledged the risk that political changes in Papua New Guinea (PNG) could create a situation where a memorandum of understanding (MoU) regarding its Wafi-Golpu copper/gold mining project would have to be changed.

“At this stage we are waiting to see what happens,” said Lauren Fourie, investor relations manager for Harmony on the matter of PNG politics. “The potential election of a new prime minister could potentially impact the memorandum of understanding (MoU) we signed with the government in December 2018,” said Fourie on May 28.

On May 30, PNG unveiled its new prime minister, James Marape, a former finance minister, who then said he intended to “tweak and turn” laws governing how natural resources are extracted from the South Pacific island.

“At the moment our resource laws are outdated … we will look into maximising gain from what God has given this country from our natural resources,” Marape was quoted by Reuters to have said in his first address to parliament as prime minister.

“I have every right to tweak and turn resource laws for my country, then it will empower my citizens as well,” Marape told the chamber to cheers and applause. “I truly want this country to be the richest black Christian nation on the planet,” he added.

The thrust of the discontent in PNG regarding the exploitation of natural resources is a gas drilling project involving French group, Total, and Chevron.

Granting of a Special Mining Permit for Wafi-Golpu have been a long-standing feature of getting the project on the road. Fourie said up until recent events various joint venture workstreams were tackling requirements of the permit which range from environmental authorisations through to the stake the PNG state will eventually hold.

The Wafi-Golpu copper-gold mine could cost Harmony Gold $2.82bn in initial capital expenditure to build to commercial levels of production as per a 2018 feasibility study. Of this, Harmony will shoulder about 50% with Newcrest Mining Limited, an Australian firm, carrying the balance. Average annual gold production was put at some 266,000 ounces.

Marape became prime minister after receiving 101 votes to eight in parliament, a day after Peter O’Neill resigned having lost the support of the house after almost eight years in power, said Reuters. Political instability is not unusual in PNG, but Marape’s resignation from cabinet in April tapped into growing concern over governance and resource benefits not reaching the poor, it said.

Harmony operates the Hidden Valley mine in PNG after taking the operation out of mothballs and buying Newcrest’s share in the business. It produced 100,000 oz at an 11% margin in the six months ended December, and was on track to achieve 200,000 oz for the full financial year, said Harmony in February.

Advertisements

Leave a comment

Filed under Financial returns, Mine construction, Papua New Guinea

Locals Claim Earthquake Poses Great Threat To Wafi-Golpu Mine

“Newcrest and Harmony have never mentioned anything about earthquakes during any awareness”

See also: Magnitude 7.5 quake alongside proposed Solwara 1 mining site

Jerry Sefe | Post Courier | May 17, 2019

THE people of Yanta, Hengambu and Babwaf are concerned about the safety of their relatives who will be working at the underground Wafi-Golpu mine when it begins operations.

Their concern follows the recent 7.2 magnitude earthquake that struck Bulolo district last Tuesday. They described the quake as a wakeup call for the Wafi-Golpu underground mine developer Newcrest and Harmony.

They said the quake was disturbing to them as such natural occurrences may be hazardous in future for the Wafi-Golpu underground mine if it comes into full operation.

They said they are not representing any individual person nor its respective landowner presidents who were supposed to represent them to speak on behalf of them. “We are concerned about the lives of thousands of people including our children who will be working underground when the mine begins operation,” they said.

Provincial chairman of mines and petroleum and president of Mumeng local level government Okam Paton said he believes the resilience of these natural disasters would be captured in the mining environment impact statement.

However, he said it is in the best interest of the landowners that the responsible authorities respond to their concerns.

According to Wafi-Golpu project environmental impact statement chapter 21 of unplanned events, there is nothing mentioned about earthquakes.

“However, these events are often described as ‘low probability, high consequence’ events in reference to the position they occupy on a typical risk matrix.

“They can be broadly categorised as: natural events, significant seismic, weather or other natural events that occur infrequently but have the potential to cause significant damage.

“Accidental events, events originating from human activity that are considered unlikely due to the engineering design, operational controls and monitoring programs that are in place, but have the potential to cause significant damage if they do occur.

“Despite the low probability of occurrence of these events, the potential natural events considered most likely to affect the project are seismic events, tsunami, storm surge and flood events, bush fire and drought,” they said.

Knowing it would bring chaos to lives and properties, the landowners said they never thought of an earthquake at all, claiming the reason behind this was because they were not informed at all by the company.

“Newcrest and Harmony have never mentioned anything about earthquakes during any awareness or during the mining warden’s hearing over the years. “We were always limited to environmental destruction, compensation, royalty, and spinoff and so forth.

“Nothing was mentioned about earthquakes and its impacts on Wafi on both open cut and underground mine or how best the project can withstand the impacts during earthquakes,” they said.

Leave a comment

Filed under Environmental impact, Mine construction, Papua New Guinea

Wafi Golpu SML Grant In June, Highly Unlikely

Frankiy Kapin | Post Courier | May 14, 2019

Wafi-Golpu Joint Venture is unlikely to be granted a special mining lease (SML) by end of June. This timeline was agreed to by the WGJV mine developer and the PNG Government.

WGJV head of external a airs David Wissink said recent developments in PNG render the possibility of a SML being granted by 30 June not viable. Mr Wissink said this as a main hindrance to the developer achieving set goals that contribute to the achievement of the project.

Wissink said WGJV is aware of the recent issuance of a stay order in the matter of Morobe Governor Ginson Saonu and others against Minister for Mining and others.

“The matter is a judicial review application made by the Governor concerning the actions of the Minister for Mining in regard to the execution of the Memorandum of Understanding entered into between the developers of the Wafi-Golpu project and the State of Papua New Guinea.

“The WGJV hopes that this matter is resolved soon, and stands ready to continue to participate constructively in all negotiations to take the project forward when it is appropriate to do so.”

Mr Wissink added that WGJV has been working constructively with the PNG Government; the Morobe provincial government; and the landowners to take forward the negotiation of various agreements necessary for the permitting of the project.

In relation to progressive proceedings including reaching the Memorandum of Agreement (MOA) by parties to the Wafi-Golpu project, Mr Wissink said the MOA is one of a number of agreements necessary to be finalized to enable the permitting of the project.

“The Mineral Resources Authority has convened a development forum, and is collecting position papers from all identified stakeholders.

The Morobe provincial government is an important participant in this process and we are very pleased that it has recently submitted its position paper,” Mr Wissink said. He said the WGJV is yet to be given a copy of the MPG position paper and looks forward to going through the paper at an appropriate time to progress the project.

Leave a comment

Filed under Financial returns, Mine construction, Papua New Guinea

Morobe’s Interest In Wafi-Golpu Legal, Says Judge

Frankiy Kapin | Post Courier | May 13, 2019

A ruling of the national court in Lae affirms that Morobe Governor Ginson Saonu (plaintiff /applicant) is a party of interest to the Wafi-Golpu project as host province.

Acting Judge John Numapo granted leave for judicial review to the signing of the Wafi-Golpu memorandum of understanding (MoU) between the State and the developer without the host province’s governor.

Justice Numapo ordered a directional hearing set for May 24, followed by a pre-hearing conference on June 6 to set a date for a full hearing of the substantive matter.

Justice Numapo ruled that Mr Saonu, in his capacity as mandated representative of Morobe Province and its people, is granted the review on two decisions pertaining to the letter constituting the legal clearance issued by state solicitor Daniel Rolpagarea (second defendant) on December 10, 2018, for the execution of the MoU between Mr Saonu, Wafi Mining Limited and Newcrest PNG 2 Limited.

The second decision for the review, as set in the originating summons, pertains to the MoU signed on December 11, 2018, between Mining Minister Johnson Tuke (first defendant) and developers Wafi Mining Limited (fourth defendant) and Newcrest PNG 2 Limited (fifth defendant).

The independent State of Papua New Guinea is the third defendant in the originating summons (OS-JR No 18 of 2019).

Justice Numapo ruled that Mr Saonu, as duly-elected Morobe Governor, has sufficient interest in the Wafi-Golpu project located in his province, therefore has standing (locus standi) seeking review through submission of the proceedings.

“One of his responsibilities is to make sure that the province generates and raises sufficient revenue from various sources within the province to maintain government services and one such revenue source is from the mining activities carried out in the province such has the Wafi-Golpu mine,” Justice Numapo said.

He said the plaintiff has taken into consideration the potential of the mine changing the economic outlook of the province and the country once operational and wants to make sure the province is well-positioned to benefit through revenue generation, employment opportunities and other spin off benefits.

Justice Numapo said the province is mindful of the environmental impact and other social issues that may arise as a direct result of the mining project and wants to ensure these concerns are properly addressed.

“I am satisfied, therefore, that a prima facie (accepted as correct until proven otherwise) case on sufficient interest has been made out in favor of granting leave for review.,” he said.

“I am satisfied that the plaintiff has sufficient interest in the matter and therefore, has the locus standi to bring this proceedings seeking leave for judicial review.”

Justice Numapo also ruled for the review after being satisfied that the Mining Minister Tuke and the state solicitor, as holders of public offices, acted in respective capacities constituting a decision or act in clearing the MoU signing through discharge of their statutory duties.

Justice Numapo granted the plaintiff, Mr Saonu, leave on May 7 to seek a judicial review of the agreement.

Leave a comment

Filed under Financial returns, Mine construction, Papua New Guinea

Proposed Wafi-Golpu Mine On Hold

MOU was signed  “when the constitutional process had not been fully exhausted and, therefore, not only premature but also a clear breach of the Mining Act and the Constitution”.

Jimmy Kalebe | The National aka The Loggers Times | May 10, 2019

A COURT has put on hold operations of the K9 billion Wafi-Golpu copper-gold mining project in Morobe pending a review of a deal signed between the Government and developers.

Morobe Governor Ginson Saonu took the matter to court challenging the legality of the signing of the memorandum of understanding last December between the Government and Newcrest Mining Limited and Harmony Gold.

Saonu on behalf of the Morobe government claimed that the signing of the memorandum was done without proper consultation with, and input from, the provincial government and other stakeholders.

The memorandum was signed on Dec 11 following a clearance letter from State Solicitor Daniel Rolpagarea.

National Court acting judge Justice John Numapo ruled that the stay order also applied to any representation by Saonu or the parties who signed the memorandum regarding the project, including any meetings or consultations.

Saonu and the provincial government had asked the court to review the letter constituting the legal clearance issued by Rolpagarea for the execution of the memorandum.

Lawyer Paul Mawa, representing the State, asked the court to refuse the leave for review because the application was premature, misconceived and defective.

He argued that it was not supported by any clear and tangible evidence.

He said the legal clearance purportedly issued by Rolpagarea was not the decision of a public body or authority and therefore could not be reviewed.

But Justice Numapo stated that Rolpagarea was public office holder and what he did fell under a public body or authority which was subjected to review.

Justice Numapo dismissed the claims by Mawa and ruled that the issues raised by the plaintiffs were prima facie as they contained substantive issues of law.

He said the issuing of the letter to clear the memorandum for signing was done when the constitutional process had not been fully exhausted and, therefore, not only premature but also a clear breach of the Mining Act and the Constitution.

He said the second issue related to the terms of the memorandum was that the Morobe government wanted to benefit fully from the project.
Saonu and the Morobe government had wanted half of the 30 per cent State equity to be awarded to the Morobe government. Justice Numapo said this was not accommodated in the memorandum.

He also highlighted the fourth goal of the national goals and directive principles enshrined in the Constitution which called for collective benefits and equal distribution of natural resources and environment for all citizens.

The case will return for a directions hearing on May 24 at the National Court in Lae.

Leave a comment

Filed under Financial returns, Human rights, Papua New Guinea

MRA Assures Wafi-Golpu Landowners Of Best Deal

WHY SHOULD WE BELIEVE YOU THIS TIME Mr GARRY?

MRA HAS FAILED THE LANDOWNERS AND PROVINCIAL GOVTS IN EVERY OTHER MINING DEAL IT HAS AGREED.

WHY AND HOW IS ANYTHING GOING TO BE DIFFERENT THIS TIME?

Post Courier | May 7, 2019

The Mineral Resources Authority’s (MRA) Managing Director Jerry Garry has assured the landowners of the Wafi Golpu project, and the Morobe Provincial Government that the MRA would ensure they get the best deal out of the project.

Mr Garry said this in light of the presentation of the position paper, by the Morobe Provincial Government (MPG), to his office last week Friday.

The paper was presented by the MPG administrator Bart Ipambonj who said the MPG’s position reflected the wishes, dreams and aspirations of Morobeans.

A position paper is a benefit sharing proposal, which individual stakeholders of mining projects propose to be tabled at an MoA negotiations forum.

“The national government will ensure that landowners and the province would get the best deal out of the project.

“This is the spirit in which the government will be moving into the MoA negotiation forum.

The MRA will do everything in its powers to ensure that all stakeholders are heard and no one is left behind in the negotiations.

“Everybody is important to the MoA process including the developer,” he said.

The other stakeholders who have submitted their position papers are the Wampar and Mumeng LLGs, the Special Mining Lease Landowners Associations of Hengambu, Yanta and Babuaf, and Deep Sea

Tailings Pipeline (DSTP) Association. Wampar Pipeline and Butibam Associations are yet to submit their papers to the state.

After all position papers are received, the MRA will consult relevant government agencies and stage another series of negotiations with all stakeholders under the ongoing development forum.
This is to ensure benefits are properly negotiated.

This process will gradually lead to the MOA for the benefit sharing arrangements of the mega-Wafi – Golpu Project.

Mr Garry said the block-cave mining method proposed for Wafi-Golpu proposed by the developer Newcrest Mining, is the first for PNG.

Newcrest is one of the leading experts in this mining method, given they have a very good track record with their deepest (1.2 km deep) panel cave mining in Cadia East, NSW, Australia.

The MD said given the narrow vertical geometry of the mine, Block-Caving is the only possible mining method.

The MD said he has every confidence in the joint venture partners to deliver the mining project successfully.

Mr Garry assured Newcrest that the government would work with the company and other stakeholders to achieve a win-win for all parties.

Leave a comment

Filed under Corruption, Financial returns, Human rights, Papua New Guinea

PNG THE BEGGING BILLIONAIRE

Linda Aniso | PNG Blogs | May 6, 2019 

Recently, I witnessed in dismay a tirade by a white man in the first class cabin of a mid-size airplane, admonishing another first class passenger, a Papua New Guinean male, for “begging” for his seat.

*What is wrong with you Papua New Guineans? All you do is beg, beg, beg for everything!! You can beg all you want; I am not going to give you my seat.*

Tempers finally cooled down, and the aircraft took off.

*Unfortunately, I was sitting next to this white man who, a few minutes ago, had insulted my whole race.*

With nothing else to do, I turned and asked him “What was all that about”?

Apparently, the Papua New Guinean man was travelling with his “wife”; they had been seated in 1st class on separate rows, and apart.

The man had asked this white man to exchange his seat, so the couple could be close.

The white man had refused, but the Papua New Guinean man had persisted with numerous “I beg you”; which eventually took the white man to his boiling point.

“So what would it have cost you to exchange your seat?” I asked.

His response, the essence of this article was this:

“I booked my flight the last minute, and got the last 1st class seat available, this one. This means it was also available to this man, if only he had asked to be seated close to his wife. He did not, but now comes “begging” for what WAS DUE HIM in the first place.”

“That still shouldn’t get your collar up”, I said.

“You may be right; unfortunately, I have just finished a month long negotiations with your ministers and government officials over your God-given mineral rights, and what my oil and gas company should pay.

I come to your country, see all this poverty everywhere, with wealth right under your feet.

Your own government gives only foreign companies the rights and privileges to rape and steal your country blind.

For a few thousand dollars, your government officials allow these foreign companies to walk away with:

(a) Perpetual tax holidays

(b) Duty free imports

(c) Bloated capital and operational investment costs

(d) under-declared mineral output

(e) minimum wages for local employees doing all the work, but FAT salaries and expense accounts for foreigners who do almost nothing

(f) exaggerated cost of shoddy school blocks and boreholes instead of meaningful royalty to local land owners and communities

(g) destruction of local farm lands with pitiful resettlement payments

(h) pollution of local drinking water

(i) destruction of local infrastructure, etc.

My bosses had counseled me at a briefing before my departure. I was asked to watch the interview of Sir John Guise on “Neo-Colonialism”. Then I was told: “be prepared, and the first, to offer the negotiating team:

(a) a few thousand dollars each

(b) a center, or a 6-room school block, or a few bore holes for the community; and there will be no mention of the usual above 10% royalties, or an actual government oversight of our operations, or adequate resettlement compensations, etc.”

I did not believe my bosses since I, a mere high school graduate, was coming to deal with officials with masters and degrees.

Imagine my shock and disappointment when these officials, instead of demanding what is INTERNATIONALLY ACCEPTABLE COMPENSATIONS AND ROYALTIES for their country and communities, only accepted the 3% royalties, and with ALL KINDS OF GIVEAWAYS, and then came to me later BEGGING me to deposit “something” in their foreign accounts (numbers written on pieces of paper). I do not want to hear the phrase “I beg you” again.

The irony here is that these so called educated people, after negotiating away their countries wealth, and depositing their “something”s into foreign banks, turn round to go and BORROW their own money from the IMF, World Bank, or “Donor” countries/ “Development Partners”.

It amazes me that your intelligentsia, ministers, Prime Minister’s, who have studied, or have travelled overseas, still don’t get the idea that “THERE IS NO FREE LUNCH”. THERE ARE NO “DONOR COUNTRIES” OR “DEVELOPMENT PARTNERS”. THE FOREIGN MINING COMPANIES TAKE YOUR MINERALS FOR NEXT TO NOTHING, DEPOSIT THEIR HAUL INTO THEIR BANKS, AND THEN TURN ROUND TO LOAN THE SAME TO OUR GOVERNMENTS, AGAIN WITH RIDICULOUS CONDITIONS SUCH AS “NO SUBSIDIZED” BASIC EDUCATION.

Surely, companies like Exxon and Newcrest are contributing to our economy, I offered.

“At what price? Have you been to Tari town recently to see the devastation and destruction of once a beautiful city? Exxon has over 800 sq. km concession in Hela; what did Tari town get in return for Exxon’s ANNUAL revenues of Billions? Almost NOTHING!!

This is exactly what your first Governor General was talking about in “Neo-Colonialism“. Have you watched his documentary? He asked me.

I was ashamed to answer “No”.

“I don’t blame you; none of your “educated” officials at the negotiating table had watched it either.

That documentary ought to be a must-watch in your schools and colleges, so that you can understand how foreign companies and governments strive to rob you blind, just as before. Only this time, their methods are cloaked in one-sided “agreements” with the connivance of your “Educated” Managing Directors, Ministers, and Prime Ministers.

“How can you accuse our officials of complicity?” I asked defensively.

Has your media asked why your minister keep defending the mining companies.

THE BIG COMPANIES LIKE, NEWCREST ARE NOT EVEN ASHAMED TO CONNIVE WITH YOUR GOVT OFFICIALS TO SIDESTEP TALKS WITH LANDOWNERS AND SIDESTEP PAYING THE INCREASED 7% ROYALTY. THEY ARE PAYING THE 5% BASED ON ANCIENT GOLD PRICE OF $300.00/OZ INSTEAD OF THE CURRENT WORLDWIDE PRICE OF $1500.00/OZ., SHORTCHANGING YOUR PEOPLE $75,000,000 in the process.

Unfortunately, your negotiating officials are happy to giggle to the foreign banks with their thousands, accompanied in some cases by “Honorable”s and“Sir”s.

Even the Chinese are getting in on the act, albeit ILLEGALLY.

They are buying off businesses and prime land, AND YOUR MINISTER RESPONSIBLE LOOKS ON UNCONCERNED.*

Your media is just as bad. With buffet lunches or dinners and a few Kina in their pockets, your print media become the propaganda machines of these mining companies.

They tout the few boreholes and the 6-room schools, but leave out the callous treatment of local employees and residents, and the destruction of the environment.

The airwaves are SILENT on all this. FACEBOOK IS THE LONE VOICE FOR THE PEOPLE.

Why don’t your media speak up by broadcasting and educating the masses, especially the officials that:

(a) THE UNITED NATIONS DOES NOT APPROVE OF FOREIGN COMPANIES ROBBING THE INDIGENES FULL BENEFITS OF THEIR GOD GIVEN MINERAL AND OIL DEPOSITS.

(b) Before 1980, foreign mining companies in PNG could not hold more than 40% interest in their partnership with the government; now the PNG govt. holds ZERO percent, while they hold 100%,; and therefore do not account to any authority.

A 50% annual return on investment (ROI) for the first 7 years, is generally considered EXCELLENT.

Foreign mining/ oil companies in PNG, are PERPETUALLY hauling away over 400% return on their investments, without any regard to the plight of the indigenous.

I feigned sleep, so he stopped talking. I was actually reflecting on all that he had said.

I realized that YES, we had become too “give me, give me”; “I beg”, “I beg you”; “My Christmas present”; “Give us something for water”.

I am reminded by this my brother’s analogy. His cat will “meow” for some food, usually crumbs, in his bowl outside.

The bowl of food will attract the resident mice. One would think the cat would opt for the juicy mice, NOO!!!

He would lay there and watch the mouse eat all his food, and then come back “meowing” for more crumbs.

WE WATCH OUR OFFICIALS GIVE AWAY OUR GOLD, OIL, BAUXITE, DIAMOND, ETC FOR THEIR MEAGRE KICKBACKS, WHILE WE WALLOW IN POVERTY.

IT IS TIME WE WAKE UP FROM OUR SLUMBER, AND TAKE WHAT IS RIGHTFULLY OURS AT THE NEGOTIATING TABLE

1 Comment

Filed under Corruption, Financial returns, Papua New Guinea