Tag Archives: Papua New Guinea

St Barbara and PNG Industry News airbrush history

St Barbara may be repaying its debts to the bank, but what about its debts to the people of the Solomon Islands, who have been abandoned by St Barbara and left with an environmental disaster on their doorstep – a decision condemned as ‘immoral’ by the Solomon Islands Environment Ministry – Australian real estate investor circles Solomons ‘disaster’ gold mine

St Barbara repays last of debt

Simberi Gold Mine

Simberi Gold Mine

DIVIDENDS and acquisitions are well and truly likely for St Barbara after the gold miner repaid the last of its $US20 million debt.

PNG Industry News | 15 February 2017

The company will repurchase the final $20 million in aggregate principal of its US senior secured notes next months at a 3.3% premium to par value.

The repurchase will reduce future interest expense by around $A2.4 million per annum.

The repurchase, to amount to $US21 million, will be repaid from cash reserves.

St Barbara, which operates the Simberi gold mine in Papua New Guinea’s New Ireland Province, expects cash after the repurchase to be around $A70 million.

In the past 18 months, St Barbara has repaid $436 million in debt and will have only equipment leases of less than $1 million outstanding after the final note repurchase.

St Barbara managing director and CEO Bob Vassie said the repayment of the debt would inform the board’s consideration of future dividends in conjunction with growth options.

The company plans to internally fund the $85-95 million Gwalia extension project.

“We can afford our future at Gwalia,” Vassie told the Sydney Mining Club earlier this month.

While he described Gwalia as the “gift that goes on giving”, he noted that the company was very reliant on the Leonora operation.

Vassie said the company was keen to add another 250,000 ounce per annum, long-life mine, and would now be able to take advantage of value-accretive opportunities as they arose.

Leave a comment

Filed under Environmental impact, Financial returns, Papua New Guinea, Solomon Islands

SME mining creating jobs for youths in Bulolo

alluvial watut

Post Courier | February 14, 2017

A SMALL to medium enterprise (SME) in Bulolo, Morobe Province is having a positive impact on youths in this area.

TRocks Construction Ltd  owned by Berldon Timah is a four-month old small scale alluvial mining company. Mr Timah said to date the company has created jobs for 48 workers who have been rostered on two shifts. He said business has been good but more could be achieved particularly for the youths in these rural areas through government intervention.

Apart from this venture, Mr Timah has established a small foundation in the area which provides help for the local schools, not just in this area but to neighboring Eastern Highlands Province as well. Timah says of the revenue generated from his projects 10 per cent goes towards the foundation’s activities.

Meanwhile, the foundation, with support from Mr Timah’s company has provided help by assisting disadvantaged communities with road projects and other basic services.

The foundation has also funded school infrastructure and supplies in the Eastern Highlands and Morobe Provinces.

Mr Timah said all his work was not to gain glory but to help give back to the community.

2 Comments

Filed under Financial returns, Human rights, Papua New Guinea

Tribal fighting is the biggest threat to the LNG project: Potape

Photo: AFP

Post Courier | February 14, 2017

TWO separate killings have been reported in Komo station in front of security force personnel on call-out operations in Hela Province.

Deputy Governor Thomas Potape when confirming the latest killing said tribal fighting is the biggest threat to the LNG Project.

Mr Potape who is also the president of the Komo local level government said despite more than seven security force vehicle presence, a community leader was killed right at the Komo Government Station on Sunday.

He said another community leader was killed at the same station last week.

“I have all the names of all suspects in Komo LLG, the biggest threat to LNG is the tribal fighting in Komo. I am prepared to assist security forces to move into Komo.”

Mr Potape said he was in Komo for the last two weeks and the killing occurred during the call-out even when seven to nine security force vehicles were there, it did not stop the killing.

“Komo has a record in killing police, army and councilors. I have 24 councils, one was killed, they held up myself, Governor, Minister for Higher Education, police vehicles. They do not have respect for Government and the rule of law.

He said four main areas have been identified and security personnel should move in numbers to protect assets like the Komo International airport and Condensation Plant for PDL1 and 7.

He said the other three identified hot-spots are Pai Kelia, Tari town and Tagali.

“Security forces should target these four trouble hot-spots. All records are with police.

Get all these information and announce the suspect’s name in public, which village, districts and council Ward he is from. Who is his Council President? Name them and move in and the community will assist hand them in.”

“I don’t want government to spend more money without any result. I will support moves to arrest all those suspects and tribal warlords in Komo. There is so much killing. I am ashamed.”

1 Comment

Filed under Financial returns, Papua New Guinea

Illegal work on Panguna stopped

panguna-gold-dredging

The National aka The Loggers Times | February 13, 2017

ILLEGAL gold dredging operations have ceased in the mid-tailings region of Panguna, according to an official.

Autonomous Bougainville Government Minister for Minerals and Energy Resources Robin Wilson told The National that the operations of Jaba Resources Limited in the area were not compliant with the Bougainville Mining Act 2015.

This resulted in the company being instructed to cease operations in December last year.

“This company’s operations came about as a result of the Bougainville Executive Council approval of a proposal for a brick production and gold extraction project submitted under the Department of Economic Development in August 2015,” Wilson said.

“On inspection of the site, and given the nature of the operations, it is clear that Jaba Resources Limited needs to be the holder of a small-scale mining lease under the Bougainville Mining Act 2015 for its operations to be lawful.

“Even if no metalliferous minerals such as gold were being extracted, Jaba Resources would still need to be the holder of a quarry lease. There are obviously other requirements under National laws as well, such as environmental approval.

“On the basis that the Jaba project has not complied with the relevant laws, the Executive Council has rescinded its decision to support the project.

“For these reasons, I have directed the Acting Secretary for Mineral and Energy Resources to take all necessary steps to bring this company’s operations to an immediate stop.

1 Comment

Filed under Corruption, Papua New Guinea

Government to pay Ramu mine landholders

After nine years of operation, the stakeholders have not seen the benefits

Tax holidays mean the Chinese are still digging for free at the Ramu mine

Why is the government having to pay out K20 million when it receives no revenues from the Chinese owned Ramu mine? Isn’t the point of these large-scale resource extraction projects that they contribute to government revenues – not add another drain on taxpayers money? 

Ramu Nickel/Cobalt project LOs to get K10m in Business Development Grants

Post Courier | February 13, 2017

THE impacted landowners of the Ramu Nickel/Cobalt project in Madang have welcomed the announcement by Government that it will pay the balance of K10 million owed to them.

This is in Business Development Grants (BDG).

‘The assurance was given by Mining Minister Byron Chan after Usino/Bundi MP Anton Yagama had raised the issue on the floor of parliament.

Chairman of Kurumbukari landowners association Tobby Bare, in welcoming the announcement said the initial commitment of K20 million had been made by the former Somare Government.

However, this commitment had been honoured by the O’Neill Government, with the first K10 million being paid.

Mr Bare said the landowners were grateful to the O’Neill Government and had urged that the balance be paid before the 2017 General Elections.

He said given the downturn in the PNG economy, the landowners had great difficulties in securing business opportunities and added that the funds would provide some relief.

“While other landowner companies in other project area have been able to progress, we have been struggling,” Mr Bare said.

3 Comments

Filed under Financial returns, Human rights, Papua New Guinea

Study: Seabed mining causes long-lasting ecological damage

Metal-rich nodules can be found in abundance on large swaths of the ocean floor. Photo by National Oceanography Center/University of Southampton

Metal-rich nodules can be found in abundance on large swaths of the ocean floor. Photo by National Oceanography Center/University of Southampton

Brooks Hays | UPI | February 10, 2017

Analysis by scientists at the National Oceanography Center in England suggest deep-sea mining operations will have long-lasting ecological consequences.

Researchers reviewed the available scientific literature on small-scale sea-floor disturbances and found clear and measurable impacts to marine ecosystems lasting decades.

As metals become scarce on land, the mining industry has turned its attention to the deep sea floor, where vast expanses of nodules rest. Nodules are potato-sized rocks featuring significant amounts of high-quality metals like copper, manganese and nickel.

No commercial deep-sea mining operations are yet underway, but the International Seabed Authority has issued several exploratory mining licenses to companies from multiple countries.

Scientists have been conducting sea-floor disturbance experiments since the 1970s. The predictive value of a single experiment is limiting, but by surveying a variety of these experiments, scientists at NOC were able to identify broader patterns.

All of the experiments analyzed by NOC researchers were much smaller than an actual mining operation.

These studies will underestimate the impacts of mining,” researcher wrote in their paper, published in the journal PLOS ONE. “Many would not even represent one month’s work for a full-scale commercial operation, which might last for twenty years.”

The longest experiment included in the survey lasted 26 years. Though the disturbed site showed some evidence of recovery, biodiversity and abundance remained diminished.

Because the deep sea floor is still poorly understood by scientists, researchers say environmental officials must be extra vigilant in regulating deep-sea mining operations.

1 Comment

Filed under Environmental impact, Pacific region, Papua New Guinea

K92 Mining brings Kaintantu gold mine back to life

kainantu-mine-plant

Sarah Byrne | Business Advantage PNG | 7 February 2017

After eight years in mothballs, Papua New Guinea’s Kainantu gold mine is preparing to export gold concentrate again. K92 Mining’s Chief Operating Officer, John Lewins, tells Business Advantage PNG the company plans to ramp up to full production around April this year.

The Canadian company has spent in excess of C$10 million (K24 million) in refurbishment and rehabilitation costs to bring the operation back into production.

‘It had been sitting for eight years,’ says Lewins. ‘There was a fair amount of capital required for refurbishment and rehabilitation of the mine.’

Kainantu gold mine, located in the Eastern Highlands of Papua New Guinea, had been on care and maintenance since 2008, when Barrick Gold acquired the operation from Highlands Pacific.

When Barrick Gold decided to sell Kainantu it provided an opportunity for K92 Mining, Lewins explains.

‘We had a couple of people on board with K92 Mining who were ex-Barrick and thought this was a fantastic project, so we acquired it,’ Lewins says.

Cash flow

K92 Mining expects to achieve positive cash flow in March or April this year.

Positive cash flow will provide the company with revenue to pay for future exploration activity, which Lewins says is critical in today’s market conditions.

K92 Mining’s original plan to fund the operation went out the window when the market went downhill in 2015, Lewins explains.

As a result, the mining company secured initial funding from New York private equity firm Cartesian Capital, before going ahead with its listing three months later.

Negative sentiment in the market is an ongoing challenge for any junior mining company, Lewins comments.

‘That market for raising funds isn’t necessarily there, so you’ve really got to focus on cash flow and generating positive cash flow to use for exploration.’

Self funding

Self-funding exploration is critical, Lewins says.

In terms of cash flow for exploration activity, Lewins says the company must work within its means.

‘I personally believe the market will change towards the second half of the year, but right now it’s a difficult market for junior mining companies,’ Lewins explains.

Kainantu’s current resource is over two million ounces, which includes the Irumafimpa area and Kora deposit. According to K92 Mining, two million ounces is only a small part of Kainantu’s potential resource.

With no previous drilling in the area between Irumafimpa and Kora, Lewins says the area has significant potential for the company.

‘It’s one of the most exciting bits of ground that I’ve seen, and one of the most exciting projects that I’ve been involved in—and that’s having spent almost 40 years in the industry.’

Production

K92 Mining aims to ramp Irumafimpa up to full production by April this year and to commence production from the Kora deposit towards the end of this year, or early next year.

In an effort to step up production activity, there are two diamond drill rigs currently working on the ground, and a third rig ready to commence work at Kora in the coming weeks.

Exploration between Irumafimpa and Kora is a focus for the company, but Lewins says there is great potential for exploration outside the mining lease. In January, K92 Mining reached an agreement with local tribal group, the Pomasi, and it has since commenced exploration in this area that spans two of the company’s exploration leases.

With connections to grid power and access to the main highway, Lewins says from a location and infrastructure perspective ‘this [Kainantu] is about as good as it gets in Papua New Guinea.’

Many areas of Papua New Guinea have limited infrastructure, but according to Lewins there are areas like Kainantu that have the benefit of road access and remain underexplored.

‘If it was in Australia, it would be overrun. Papua New Guinea is an incredibly well endowed and a massively underexplored area of the world.’

2 Comments

Filed under Mine construction, Papua New Guinea