Tag Archives: Papua New Guinea

Barrick offering 50% profit share in Tanzania

Will Barrick be offering PNG 50% of the profits from its Porgera mine?

New found resource nationalism may create complications for Barrick’s Bristow in PNG

Mining MX | February 21, 2019

A PROPOSED transaction in which Barrick Gold could share profits from its Acacia Mining with the Tanzanian government on a 50/50 basis could have ramifications for the Toronto-headquartered group in other mining districts, said Bloomberg News.

The newswire said that efforts by Barrick Gold to extend its mining licence agreement with the government of Papua New Guinea over the Porgera asset might be complication if that government sought to replicate the deal in Tanzania.

Mark Bristow, CEO of Barrick Gold, has suggested that the company might not divest of Porgera as the company previously suggested. He has also reached out to the new president of the Democratic Republic of Congo, Felix Tshisekedi, in the hope he’ll consider a review of the recently promulgated mining code.

All of these events might, therefore, by influenced by the outcome of the dispute with Tanzania which is where the offer to share the spoils of Acacia Mining comes from. Acacia, 63.9%-owned by Barrick Gold, has been in dispute with the Tanzanian government over unproved allegations it owes $190bn in unpaid tax dating back some two decades (including penalties and interest).

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Barrick must be accountable for environment destruction

We pray that Barrick is held to account for the misery, pain and loss our people suffered

David Mandi | Post Courier | 21 February 2019

The Porgera River Alluvial Miners Association is responding to an article in Tuesday’s edition of the Post-Courier titled ‘Barrick confirms continuing commitment to PNG Government and Porgera community, which was reportedly released by the new president and chief executive officer of Barrick, Mark Bristow.

First, we confirm our support and commend the Prime Minister, Hon Peter O’Neill’s bold announcement recently that there will be no automatic renewal of the Porgera special mining lease (SML) once it expires in August this year. The Prime Minister’s announcement is surely the best news in decades (30 years) for the poor and illiterate indigenous alluvial miners living along the Porgera river, who had been suppressed and marginalised by the world’s mining powers including Barrick.

Secondly, our response to Barrick’s press release follows.

Barrick has deliberately failed to maintain a positive relationship with us (affected people) in the past, while being fully aware that their operations were physically and economically displacing more than 10,000 people of the Porgera river through their continuous discharge of mine waste (more than 1.5 billion cubic meters per year) directly into the Porgera River system.

Further, to date, Barrick has intentionally failed to pay us compensation award made in our favour through the 1996 Ministerial Determination (“1996 MOil) to settle the six year (1990-1995) compensation dispute.

Thus, Barrick has been illegally discharging waste using a flawed Environment Permit number WD-L3 (121).

We pray that Barrick is held to account for the misery, pain and loss our people suffered.

Thus, Barrick’s continuous presence in Porgera is detrimental to the health, welfare and safety of the Porgera river alluvial miners.

And we will continue to vigorously oppose and protest to Barrick’s application to renew the Porgera SML and Exploration Licences 454 and 858.

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Deep sea mining threatens indigenous culture in Papua New Guinea

Seabed Mining (Graphic: Greenpeace)

John Childs | The Conversation | February 19, 2019

When they start mining the seabed, they’ll start mining part of me.

These are the words of a clan chief of the Duke of York Islands – a small archipelago in the Bismarck Sea of Papua New Guinea which lies 30km from the world’s first commercial deep sea mine site, known as “Solwara 1”. The project, which has been delayed due to funding difficulties, is operated by Canadian company Nautilus Minerals and is poised to extract copper from the seabed, 1600m below the surface.

Valuable minerals are created as rapidly cooling gases emerge from volcanic vents on the seafloor. Mining the seabed for these minerals could supply the metals and rare earth elements essential to building electric vehicles, solar panels and other green energy infrastructure. But deep sea mining could also damage and contaminate these unique environments, where researchers have only begun to explore.

The industry’s environmental impact isn’t the only concern. It’s been assumed by the corporate sector that there is limited human impact from mining in the deep sea. It is a notion that is persuasive especially when compared with the socio-ecological impacts of land-based mining.

But such thinking is a fallacy – insights from my research with communities in Papua New Guinea over the past three years highlight that the deep sea and its seabed should be thought of as intimately connected to humanity, despite the geographical distances involved. For the people of the Duke of York Islands, deep sea mining disturbs a sense of who they are, including the spirits that inhabit their culture and beliefs.

Young people on Duke of York Islands. Paul Hearne, Author provided

Out of sight, out of mined

In Western thought, the sea has not only been considered to be marginal to politics, but also as entirely distinct from the land. Separating nature from humanity has proved useful in enabling exploitation of the natural world for human means. Deep sea mining, with all its material connections between a dynamic seabed and sites of consumption on land, provokes new questions.

If humanity can’t physically encounter the deep seabed, then how are we to treat it ethically?. By conceptually “distancing” the deep ocean, who is being marginalised?

For the people who live close to Solwara 1, the answer is pointed. These communities have long understood the world as a connection between “nature”, “spirits” and “beings”. Central within this cosmology are the spirits – masalai – some of which are understood as guardians of the seabed and its resources.

The people of Duke of York Islands are tied spiritually to events in the deep sea. John Childs, Author provided

Masalai are a fundamental part of the islanders’ world. Thus, the prospect of deep sea mining means not just social and economic disruption, but spiritual turmoil. The digging up of the seabed and the extraction of its resources cuts through the very fabric of their spiritual world and its sacred links to the sea and land.

As the historian Neil Macgregor put it in the Radio 4 series “Living with the Gods”, masalai are not

out there… [like] tourists in the human realm, from somewhere else … but in a world in which we co-inhabit.

The political implication for island communities here is clear. The copper which might be mined from the seabed is effectively constituted by these spirits. Thus, as copper “resurfaces” in the objects and technologies of the future – in batteries and wiring – it also carries a spirituality from the region where it originated.

Spirits infuse the traditions and everyday practises of the people on the Duke of York Islands. “Shark calling” is one such example which is practised along parts of the west coast of New Ireland Province – the closest point on land to Solwara 1.

Every few weeks, when the sea conditions allow, “shark callers” attempt to attract sharks to their hand-carved wooden canoes by rattling a mesh of coconut shells in the water, before capturing them by hand. Shark meat is a key part of local diets that generally lack protein.

Shark callers communicate with spirits which are “resident” in stones found on local beaches prior to their expeditions. It’s no surprise then, that these communities fear noise pollution generated by deep sea mining and the physical disturbance of the seabed which could sever the cultural connections they have with the ocean.

Deep sea mining companies should consider the spirituality of the people their work affects and other kinds of environmental knowledge as important in their own right. As this new industry collides with cultural belief systems in different parts of the world, it will be essential to understand the complex ways in which deep sea mining does have “human” impacts after all. Culture is a key part of any understanding of environmental politics, no matter how extreme the environment in question.

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NGO warns about Bougainville govt’s ‘land grab’

Site of the Panguna mine

Radio New Zealand | 18 February 2019

An NGO has warned that proposed changes by the Autonomous Bougainville Government to local mining laws constitute a reckless land grab.

The government is planning to set up a company to control all new mining on the island.

60 percent of Bougainville Advanced Mining would be owned by the government, while 40 percent would be in the hands of a foreign partner.

In order to do this, the government is seeking to pass amendments to the Mining Act.

Luke Fletcher, the executive director of the NGO Jubilee Australia, said the changes would cut out Bougainville landowners from having a say in mining.

“The principle of free, prior and informed consent is just totally denied to the landowners. Their say is just completely irrelevent. The executive can now essentially be responsible for all parts of the island that are not under lease,” Dr Fletcher said.

Following a public outcry over the plan, the proposed amendments have been referred to a parliamentary committee for further discussion.

Earlier, a number of landowner and community groups voiced alarm that Bougainville’s government was trying to rush through the changes without adequate public consultation.

“It is not clear to us that this legislation is even constitutional,” said Dr Fletcher, who described the government’s proposed changes as a “startling and dangerous move”.

“Given the disastrous history of the Panguna mine in Bougainville, which has caused irreparable environmental damage to the Jaba river and was the major cause of the Pacific region’s worst ever civil war, forcing through such enormous changes with very little consultation is a reckless and desperate ploy.”

Speaking to RNZ Pacific two weeks ago, Bougainville’s President John Momis described the mining deal as the best on the table for his people.

He also suggested the deal was a way to solve Bougainville’s lack of funding for its independence referendum later this year.

But Dr Fletcher said it was unlikely the proposed deal would create revenue through taxes and dividends for Bougainville for a number of years.

“So even if there was some sort of capital investment, that can’t go to the government for general revenue,” he explained.

“That has to be spent by the company on its own needs. So it just doesn’t really make any sense that all this could be useful for the referendum.”

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Mining industry spooked as PNG wakes up to lack of benefits and hidden costs

The Mining Industry is suddenly on the back foot as PNG wakes up to the fact its extractive industries have failed to deliver the promised economic benefits while destroying communities and the environment. In trying to respond to the growing anger and resentment, the industry is continuing to spin the same old lies and misinformation…

Mining lease uncertainty in Papua New Guinea

Mining Review Africa | February 15, 2019 

The Papua New Guinea Chamber of Mines and Petroleum says the continued success of existing projects and the development of new ones is critical for the future of the country.

And that any significant delay in the renewal and extension of mining licences for the country’s biggest producing mines would have a detrimental effect on the nation’s economy.

Chamber President, Gerea Aopi CBE, comments following reports that projects such as Porgera, Ok Tedi and Ramu Nickel may not have their leases extended.

“Security of tenure and continuation of mining leases is essential if we want investors to spend billions of Kina in our country,” says Aopi. 

“Delays and uncertainty about mining leases could cause major interruptions to some of the big mines, and discourage any new investors.”

Aopi explains the Chamber and its members are keen to work with Government to ensure that Papua New Guinea’s investment climate for resource projects remains attractive as this will underwrite a strong growing economy and increased prosperity for the people.

Aopi says the industry is concerned that mineral exploration activity in Papua New Guinea has fallen significantly in the past six years even though global exploration has experienced a significant upturn since 2016.

With this decline in exploration, any uncertainty about renewal of mining licences would have an impact on the country’s economy, and also send international investors the wrong signal, particularly at a time when the World Bank through its Papua New Guinea Economic Update released this month projected a positive rebound in the country’s real Gross Domestic Product to 5% this year on the back of upcoming major resource projects.

According to data supplied by the Mineral Resources Authority, mineral exploration expenditure in 2018 was K295.9 million compared to K339 million in 2017, K373 million in 2016 and K358 million in 2015.

The last time mineral exploration expenditure reached its peak was reached in 2013 when it was K596 million.

While certainty of mining leases is critical, Aopi says all Chamber members are committed to ensuring that benefits flow from their operations to local communities and he applauds the Government’s continuing commitment to ensuring the sustainable and accountable sharing of benefits.

“The industry remains ready and willing to work with Government and relevant authorities to ensure a fair distribution of benefits for the State, local communities and the industry,” he states.

“Papua New Guinea is one of the first countries in the world where mining and petroleum projects consistently provide socio-economic opportunities to the local areas they operate in.

“Projects have opened up access and opportunities in some of the most isolated rural communities in Papua New Guinea ,” he explains.

In 2017, the mineral and petroleum resources sectors contributed over 26% of PNG’s GDP and about 84% of the nation’s export revenue valued at K23 billion.

The major producing mines, Ok Tedi contributed to Papua New Guinea’s mineral export revenues in 2017 over K3.1 billion while Porgera contributed over K1.8 billion, Ramu Nickel over K1.1 billion, and Lihir over K3.6 billion (FY18).

According to the 2017 Papua New Guinea Extractive Industry Transparency Initiative report, the industry paid a total of K1.5 billion in direct and indirect taxes.

The mining and petroleum industry directly employs over 20,000 people, with significantly more working in other sectors dependent on the industry, including landowner businesses.

The industry invests millions of Kina in community development in sectors such as health and education, infrastructure including roads and airstrips, employment and training, and agriculture and livelihood programs. 

The industry also establishes and supports landowner companies and other Papua New Guinea -based businesses that provide services to the project sites such as transportation, labour hire, catering, security, earthmoving, freight and logistics, janitorial services, agriculture, and livestock and livelihood programs to promote food security and agribusiness.

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Proposed Bougainville Mining Act changes go to committee

Radio New Zealand | 15 February 2019

Proposed changes to Bougainville’s Mining Act have been referred to a parliamentary committee for further discussion.

The Autonomous Bougainville Government’s proposed the changes which have met with widespread opposition as the region prepares for a referendum on independence from Papua New Guinea.

The government last month divulged its plans to re-open the long shut Panguna copper mine and operate it with a company majority owned by Bougainville.

It sought to pass amendments to the Mining Act to accommodate an Australian investor who will jointly own Bougainville Advance Mining.

The Bougainville Advance Mining Holdings Trust Authorisation Bill, the Bougainville Advance Mining Holdings Limited Authorisation Bill, and a bill to amend the Bougainville Mining Act 2015, have all gone through first readings.

However, after community concern over the proposed amendments, the bills were referred to the Legislative Review Committee.

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No Ramu extension until benefits are guaranteed: Govt

‘Ramu nickel mine is the worst ever State negotiated mine with no benefits to the locals’ – Yama

Loop PNG | February 12, 2019

Prime Minister Peter O’Neill has announced there will be no extension of the Memorandum of Agreement (MoA) for the Ramu NiCo mine in Madang Province.

The initial MoA was signed in 2000 and expired in March 2018. It is now due for a review, however the Prime Minister announced last Friday that there will be no agreement until government is sure there is fair benefit for the people and the State.

“The mine agreement has expired and we will renegotiate so that our people benefit most. Bai yumi stap na lukluk tasol ah? Nogat! Nogat! Em blong yumi. Yumi mas gat sampla sher stap insait. Bai yumi stretim, Gavana bai yumi stretim, mark my words. Yumi mas lukautim ol pipol blong yumi pastaim,” O’Neill said. (Will we just stand and watch? No! No! This is for us. We must have some share in this. We will fix this, Governor we will fix this, mark my words. We must first take care of our people.)

He told Governor Peter Yama that they had a big task ahead to negotiate the new terms and conditions of the new agreement.

Yama expressed passionately that the Ramu NiCo mine was the worst ever State negotiated mine with no benefits to the locals in Kurumbukari and Basamuk. Concerns have also been raised that other minerals apart from nickel and cobalt have been extracted and exported.

“The people of Basamuk must have spin off businesses. They must have good roads, good housing, health centres, schools, water supply and electricity. Right now Rai Coast and Usino-Bundi are the least developed districts in the country despite being hosts of the Ramu NiCo mine and also the Ramu Agro Industry for Usino Bundi,” Governor Yama said.

Minister for National Planning, Richard Maru, visited Basamuk last Thursday and met with the mine operator, MCC, and encouraged all stakeholders to now focus on a way forward that will benefit the company, province, landowners and the State.

At the moment, the State is not an equity partner in the mine project. There has not been any corporate tax and no Goods & Services Tax paid by the company since production began in 2012.

Furthermore, there is no benefit sharing agreement for the landowners in the project. Minister Maru said in the future, MoA’s must have benefit sharing agreements where landowners, the host province and the State must have shares in the project. This will be the case for Wafi-Golpu Mine, the Frieda Copper Mine and any other upcoming mines in the country.

“MCC is not the enemy, we are partners in development and so in the negotiations for the new MoA, we must ensure win-win situation for all parties involved,” Minister Maru said.

He said Madang had the economic potential and opportunity to double and triple its internal revenue and become a major economic hub in the Momase region. Minister Maru challenged Governor Yama and all the other MPs from Madang to focus, cooperate, communicate more for the greater good of the province.

Minister Maru is certain MCC has by now recovered its initial investments in the mine. This also explains why the Ramu mine is looking to invest a further US$2 billion to double production. The State, provincial government and landowners must now take up equity in this lucrative mine under the new agreement that the Government will take on together with MCC. The challenge now is to properly identify the landowners and Mineral Resources Authority (MRA) must ensure this exercise immediately by MCC.

In saying that the company must not feel that it has to solve all the problems in the area, Minister Maru encouraged MCC management to participate in the new-look Infrastructure Tax Credit Scheme which will be launched in March. He also urged the company to work with the PNG Government to seek grant funding from the Chinese government to build most needed infrastructure in the Usino-Bundi and Rai Coast districts.

The particular focus would be to build a highway between Erima to Saido and other roads, health and education facilities within these two districts.

The Ramu NiCo mine has a 135km slurry pipeline that runs through Usino-Bundi and Rai Coast districts.

Minister Maru also maintained that mines should do away with the fly-in fly-out arrangement and return to the model of the Bougainville Copper Limited where mining townships must be built at the mine sites.

Governor Yama also supported the position of the Government of Morobe and the Tutumang Government that there shall be no “Fly in Fly Out”, for the Wafi -Golpu Mine Project and other Mines and Resource Projects into the future.

“We will maximize revenue flows from all these projects to go to the local people, landowners and to our Government and to remain in the country. Hospitals, schools, a township and other utility services are built there. There’s no reason why we shouldn’t use this model,” Maru said.

“If we want to allow the revenue from these mines to rotate within PNG and help build our country, in the form of taxes, employment and so on, we must walk away from the fly-in fly-out arrangement.”

Maru said the Government is committed to build a highway from Erima to Saidor in Rai Coast District to assist the people living along these areas access markets and services and is seeking the support of the Chinese government to focus their development grants away from Port Moresby to two the remote districts of Usino- Bundi and Rai Coast, which hosts the only Chinese owned mine in Papua New Guinea, the Ramu NiCo Mine.

A State Negotiation Team will be put together as soon as possible to commence discussion of the future of the mine and its stakeholders, including the State and the landowners.

The Prime Minister himself announced that he will chair the State negotiating team with the Madang Governor as key members of the State Negotiating Team.

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