Tag Archives: Porgera

PNG PM urges multi-nationals to allow gas project to proceed

Papua New Guinea’s prime minister James Marape. Photo: PNG PM Media Unit

Radio New Zealand | 8 February 2020

Papua New Guinea’s prime minister has urged two energy companies not to hold a major LNG gas project in his country to ransom.

James Marape’s appeal to ExxonMobil and Oil Search follows the failure of negotiations with the former over the fledgling $US13 billion P’nyang gas project

Oil Search said PNG was demanding terms of Exxon that meant the project developers would not gain a sufficient return on their investment.

But Mr Marape accused Exxon of a “lack of interest” to meet PNG halfway by offering concessions for a better state take from the deal.

The failure of the negotiations has raised doubt over the future of the separate Papua LNG gas project signed with French major Total.

Mr Marape said he called upon the two multi-nationals, as beneficiaries of concessions previous governments have given, to work with Total to deliver Papua LNG.

However, he appeared to leave the door open for an agreement with Exxon over the P’nyang gas project proceeding.

He said in the interests of fairness, a Ministerial Gas Committee would request both the state negotiating team and ExxonMobil to present their positions for the State – through a committee of leaders – to decide what is the best outcome for PNG.

The prime minister said he had indicated on all levels of discussions that fundamental policy principles that influenced his government’s mindset would not change.

“These include no fiscal concessions in P’nyang, treating P’nyang as separate from both PNG and Papua LNG projects, increase in Domestic Market Obligations and local content participation,” he said.

“These will be fundamental in progressing P’nyang.

“In the meantime, I call upon ExxonMobil and Oil Search not to hold the Total project in Gulf to ransom.

“If you model the project to be uneconomical, then don’t push it: let’s leave the gas in my land and you develop Papua plus further work in PNG LNG.

“After SNT and ExxonMobil present to the MGC, Cabinet will decide on P’nyang.”

Mr Marape said his government would shift focus to Wafi-Golpu and Porgera mines, and other resource sectors so life in PNG was not only dependent on P’nyang and other LNG gas projects.

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Papua New Guinea Gold mine to become a top tier mining asset while landowners’ rights ignored

Financial Post

The most basic needs and rights of Papua New Guinea landowners are being completely disregarded while a Canadian and Chinese consortium talks up the potential of an internationally significant gold mine ahead of a PNG Government decision on the mine’s lease renewal.

Porgera Gold mine in remote Enga Province of Papua New Guinea expired last year and consortium made up of Canada’s Barrick Gold Corp and China’s Zijin Mining wants their lease to be extended for another 20 years.

A majority group of landowners, the Justice Foundation for Porgera headed up by the PNG Resource Owners Chairman Jonathan Paraia believes Barrick has no intention to deliver on promises it’s making to reduce environmental destruction or stop practices that damage local lives.

“Barrick has had 20 years to adequately deliver on its promises to resettle landowners, provide housing, education, clean drinking water so how can we for a moment believe that it will start honouring promises made under new contracts,” he said

“How many more independent reports detailing environmental and human rights abuses need to be published before the mine is held to account,” he said.

Mr Paraia understands Barrick needs this lease to be renewed so it can conclude a deal with Chinese state-owned entity Zijin.

“If the lease is renewed Barrick will not see it out, it intends to divest its share to its Chinese partner or someone else,” he said.

In 2015 Barrick Niugini officials told Landowners to make an offer for 95% of shares in Porgera mine but we could only make an offer for 10% so there was no sale. Instead in 2017 it sold half its shares to Zijin. We believe its goal is to sell its remaining shares once the lease is renewed.

The Chairman of the Justice Foundation for Porgera is also extremely concerned about a 70 million kina (almost $20M US) donation made to the Enga Provincial Government last week by the Chinese Government.

“The extremely generous donation while a decision on the mine is imminent is highly suspicious at best, and deserves a high level of scrutiny,” he said.

Jonathan Paraia also wants Barrick and elements of the PNG Government to stop cherry-picking supportive minority landowners with conflicts of interest and listen to the vast majority who want Barrick out.

“In the last fortnight, as part of Prime Minister James Marape delegation to Enga, Minister Johnson Tuke, Minister Bryan Kramar and Mineral Resources Authority head Jerry Garry unofficially visited the mine site and met with Barrick employees and contractors who claimed to be landowner representatives.

“Two of the guests, in particular, Dick Pundi a director of Ipili Porgera Investments Ltd (IPI) and Maso Mangape an employee of IPI claim to represent the interests of Landowners when IPI is a major service provider to Barrick, so whose interests are they serving?” he said.

The Justice Foundation for Porgera is aware the Prime Minister is adamant to take over the Porgera Gold Mine but other representatives of government are acting against the interest of the Prime Minister.

“The people of Porgera and the Justice Foundation for Porgera know the Prime Minister James Marape is listening to the people and has the best interests of our country at heart.

“We stand behind the Prime Minister and support him to say Barrick out, it’s time Papua New Guineans profited from Papua New Guinea’s valuable resources,” Mr Paraia said.

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Barrick Gold forges ahead on Papua New Guinea mine in face of local backlash

Jeff Lewis and Melanie Burton | Reuters | January 15, 2020

Barrick Gold Corp is set to elevate its troubled Papua New Guinea mine to its top-tier assets, despite landowner and government demands to cede a larger stake and deteriorating security at the joint venture with China’s Zijin Mining

With a 20-year lease renewal application in the balance, Barrick has faced backlash from Papua New Guinea (PNG) landowners and residents. Critics say the Porgera mine has polluted the water supply and created other environmental and social problems, with minimal economic returns for locals.

Seven people have died at the Porgera mine since September, including three so-called illegal miners last month in clashes that prompted Barrick’s local entity to appeal for government intervention.

Barrick hopes to boost the mine’s production by 18% or more. This previously unreported outlook raises the stakes for Prime Minister James Marape’s government, which has been seeking richer terms from miners and oil and gas producers.

The head of the country’s mining regulator said Barrick, the world’s No. 2 gold miner, is waiting to begin serious negotiations for permit renewal terms with the country’s executive council, led by Marape.

“If we can renew the permit on a reasonable basis, it stands up as a tier one asset,” Barrick Chief Executive Officer Mark Bristow told Reuters, referring to a large scale, long-life, high margin deposit.

PNG’s next steps with Barrick could influence billions of dollars of planned investment by global miners including Australia’s Newcrest Mining and St Barbara, who are eyeing new mines or mine extensions, but are wary of rising sovereign risk.

Miners, facing a dearth of new deposits and rising resource nationalism, may now have to cede greater rewards to other stakeholders.

“There will have to be equitable sharing of the spoils or these things won’t be developed or will be discontinued, ultimately,” said portfolio manager Simon Mawhinney, at Allan Gray in Sydney who is among Newcrest’s biggest investors.

Barrick’s tier-one designation, used describe a mine capable of producing 500,000 ounces of gold annually for at least 10 years at low cost, would place Porgera in league with Barrick’s crown jewel assets at a time major gold miners are desperate to replace shrinking reserves.

Barrick and Zijin’s combined 2018 production at Porgera was around 421,500 ounces.

ENVIRONMENTAL ISSUES

An exposed pipe that Barrick uses to dump its tailing into the environment at Porgera in Papua New Guinea and people desperate for an income pan for residual gold in the waste, seen in a photograph from 2017. Photo by Catherine Coumans

Barrick has broadened the role of its top China executive and former U.S. diplomat Woo Lee to handle day-to-day talks with the PNG government. It has pledged to relocate villagers whose land the mine has swallowed and study ways to improve management of mine waste currently dumped in rivers, Bristow said.

The moves, aimed at mollifying concerns over access to arable land and pollution of local waterways, may not be enough to satisfy landowners and the PNG government who want a larger equity stake.

Barrick and Zijin each own 47.5% of the mine, with the remaining 5% held by landowner group, Mineral Resources Enga.

Analysts have said Barrick could opt to put its stake on the block with other assets it has shed to meet a $1.5 billion divestment target. But Bristow played down a potential sale, saying Porgera fits Barrick’s investment criteria.

“It makes real returns, it creates value, it can survive the cyclicality of the gold industry and will make a significant contribution to our other stakeholders,” he said.

Barrick’s top executive has shown he is willing to make concessions to settle disputes. In October, Barrick agreed to sell Tanzania a 16% stake in each of its Bulyanhulu, North Mara and Buzwagi mines to resolve a long-running fight over taxes.

The Canadian miner may face added pressure to confront issues in PNG that run afoul of investor benchmarks on environmental, social and governance issues.

Citi, for example, has pledged not to support mining companies who use riverine tailings disposal which an NGO said in a 2019 report had polluted the rivers and denied locals reliable drinking sources.

Maso Mangape of the Porgera Land Owners Association said local residents had been squeezed out. “The mine site has now become a battlefield,” he said.

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MRA Updates On Porgera Mine Lease Application and Wafi-Golpu

Melisha Yafoi | Post Courier | January 7, 2020

Application for a Special Mining Lease for the Porgera gold mine is still in progress.

Mineral Resources Authority managing director Jerry Garry told the Post-Courier that the state is progressing the determination of the application which expired on August 16, 2019.

Mr Garry said during that process there will be two major streams of activities including the negotiations of the Mining development contract and recommendations from the Mining Advisory Council.

He said for the Mining development contract, the State Negotiation Team, (SNT) will recommence negotiations with the mine operators Barrick & Zinjin upon receiving directives from the NEC.

“This process will principally discuss fiscal regimes and other stability agreements in terms of taxes, royalties, equity, national content and other benefits teams,” he said.

While for the recommendations, he said this will be administered by the MRA whereby the technical and financial capabilities of the operator and compensation agreement pertaining to the extension application will be presented before special MAC for its deliberations and recommendations, either for refusal or grant to the Mining Minister & ultimately to NEC.

“We anticipate conclusion of the permitting, if, all goes well without any disruptions to the process, within first or second quarter of 2020,” he said.

Mr Garry said the permitting of Wafi-Golpu project after being halted due to a court injunction order was relieved preventing everyone from doing any work.

He said the injunction remains on foot and will SML application be dealt with only when the court injunction is resolved.

“Whenever the court injunction is relived, the MRA will formalise the remaining landowner associations along the pipeline and tailings outfall, and continue to hold development forum to develop the memorandum of agreements and compensation agreements with landowner associations, LLG and provincial government.

Concurrently, the SNT will re-open Mining Development Contract negotiations with the project development proponents, Harmony and Newcrest,” he said.

“It is anticipated that SML permitting may take 4-6 months from the date when the court injunction order is lifted.”

Mr Garry said as for the Revised Mining Act, whenever the Revised Mining Act is passed by the Parliament, the MRA will re-align itself to meet the new changes.

He said the Prime Minister has urged another consultation with the industry during the December 2019 PNG Mining Conference and the Department of Mineral Policy & Geohazard Management will be coordinating this process.

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Fighting Among Illegal Miners Worries Barrick

Barrick Gold looks to PNG government to sort out a mess that the Canadian mining company itself has created

Post Courier | December 30, 2019

Operator of the Porgera gold mine in Enga Province, Barrick Niugini Limited (BNL) has called on the government for an urgent intervention in Porgera after a protracted violent conflict between armed warring factions of illegal miners.

The operator stated that the illegal miners are believed to be from Tari.

The incident happened earlier this week on the Porgera Special Mining Lease which the clash occurred in the mine’s open pit area where numerous gun shots were discharged.

There were also reports from community members that many other combatants with injuries from the gun battle were carried away from the area by their accomplices.

The gun battle came just 24 hours after mine security personnel and members of the PNG police recov-ered the body of a woman who had died of significant injuries, including gun-shot wounds, within the mine’s operations area. The woman was also believed to be from Tari.

“BNL is appalled by the level of lawlessness that is continuing to pervade the Porgera district, and is particularly concerned by the senseless killing and the use of rearms by warring groups of illegal miners who have invaded Porgera from other areas.

“The on-going use of rearms by outside criminal elements continues to create fear among the community and local mine employees,” a company spokesman said.

“The company remains ready to support the government’s commitment to a long-term solution for Porgera’s law and order problems, following discussions between Police Minister Bryan Kramer and the community during the Minister’s recent visit to the district.”

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Shining a light on corporate human rights abuses in the Pacific

Business & Human Rights Resource Centre’s Amy Sinclair introduces a new portal that focuses attention on a resource-rich area remote from the rest of the world

Amy Sinclair | Ethical Corp | December 9, 2019

In recent months, damaging spills caused by foreign miners operating in the Solomon Islands and Papua New Guinea have wreaked havoc with the safety and livelihoods of coastal communities.

At the same time, with the independence referendum under way in the Bougainville region of Papua New Guinea, mining companies are jostling for new licenses. This is in a region where tensions over the infamous Panguna mine sparked a bloody decade-long civil war in the 1990s. Memories fade fast, particularly when there are profits to be made.

The Pacific region is intensely resource-rich, but with great distances separating Pacific nations – not only from one another, but also from much of the rest of the world – human rights abuses by companies have too often occurred in the shadows.

Mining companies are seeking licences amid Bougainville’s referendum for independence. (Credit: Melvin Levongo/Reuters)

With inward-investment growing, Pacific communities face increasing challenges to fair and informed engagement and run the risk of exposure to higher levels of abuse and environmental harm by global companies. This is particularly true for those on the frontline of deforestation, irresponsible mining, fishing, tourism and seabed exploitation.

Local activists and communities fighting these abuses are hindered by being far away from foreign company headquarters located in Canada, Australia or China. Distances may be great, but Pacific voices deserve to be heard. With greater visibility on global platforms, communities and advocates can be supported in their efforts to achieve stable, sustainable growth that will protect future generations.

The need for this increased visibility is great. Business-related human rights harms in the Pacific are, increasingly, being documented. Yet severe human rights abuses, including forced labour, slavery, human trafficking and child labour, persist.

In June, the Business & Human Rights Resource Centre (BHRRC) published a report on modern slavery in the Pacific tuna sector, which provides almost 60% of the world’s tuna catch in a growing industry currently worth $22 billion. The report surveyed 35 canned tuna companies and supermarkets, representing 80 of the world’s largest retail canned tuna brands, and found that, outside a small cluster of leading companies, the sector is not translating human rights policies into practice. Without urgent and decisive action in the Pacific fishing sector, and by those sourcing from it, there is a danger that company policy will provide a fig-leaf for abuse, while slavery continues unabated.

Deep-dives such as this yield invaluable insights into sector-specific questions, but more is required. There is a pressing need to raise awareness of the human rights responsibilities of companies operating in all sectors in the Pacific, and to bring to light the true nature and scale of human rights abuses being committed across the region.

The Solomon Islands, and Fiji in particular, are experiencing high levels of mining activity, and there is a danger that the mistakes of the past – seen in Papua New Guinea with the abuses and environmental degradation at Panguna, Ok Tedi and Porgera – will be replicated there and beyond. Community consultation must form the cornerstone of human rights due diligence by companies seeking to invest in the region, and profits should be fairly shared.

The Pacific tuna sector provides almost 60% of the world’s tuna catch and is worth $22bn. (Credit: Erik de Castro/Reuters)

 Fortunately, a nascent business and human rights movement is emerging in the Pacific. The first-ever dedicated Pacific session, Advancing the Business and Human Rights Agenda in the Pacific, was held during the annual UN Forum on Business and Human Rights in Geneva last month, a testament to the progress that has been made in the region recently.

To support and chart the growth of this emerging movement, BHRRC has launched a new web portal dedicated to the region. The Pacific portal brings the broad range of local business and human rights issues into sharper focus and amplifies local and community voices.

It’s hoped the portal will be a crucial tool for human rights and environmental rights advocates, both in civil society and in businesses themselves, seeking to prevent abuse and improve company human rights practices in the region. It will do this by highlighting research on key issues, identifying allegations of business-related abuse and calling attention to emerging cases.

Stability in the Pacific region requires urgent action to ensure human rights are embedded in investments from inception. Without regard for international rules requiring respect for human rights in business, the sustainability of life in the Pacific for future generations is under threat.

Efforts like this web portal are needed to shine a light into the shadows and improve awareness of Pacific business and human rights issues on the global stage.

To visit BHRRC’s Pacific portal click here: Pacific Business & Human Rights

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PNG PM urges patience over Porgera mine talks

“Government was well aware that a majority of landowners want Barrick’s lease not to be renewed” – PM.

Radio New Zealand | 5 December 2019

Papua New Guinea’s prime minister has urged patience while negotiations over the contract for the Porgera gold mine continue.

James Marape was responding to questions in parliament from Laigap-Porgera MP, Tomait Kapili.

Barrick Gold Ltd, the co-operator of the mine in Enga province with China’s Zijin Mining Group, is pushing to renew its contract.

Mr Kapili requested that Mr Marape move all negotiations to Porgera itself, to adequately gauge landowners’ views and the extent of problems around the mine.

The MP spoke of ongoing “serious” law and order problems which he linked to a surge of outsiders to Porgera since the expiry of the Special Mining Lease in August.

“Since the expiry of the SML there’s hundreds and thousands of people coming from afar, outside the valley, claiming that the extension of the license – while we are negotiating – is not in order, ‘they are illegally mining, so we also want to illegally mine’.”

The prime minister answered that the government was well aware that a majority of landowners want Barrick’s lease not to be renewed.

He said the government had received many written and oral representations from landowners indicating that over 90 percent of them were against Barrick staying on.

“But we are mindful that our partners are operating the mine and they have the asset up there in the mine itself, so those discussions will bring to full conclusion when we consult everyone.

“I intend in the new year (for) an announcement to be made to the status of what will happen in Porgera,” said Mr Marape, adding that he would consider the Laigap-Porgera MP’s request.

“Let me assure the member that I look forward to considering his recommendations in the positive, that all discussions, if not all major discussions, will take place in Porgera, be held in the Porgera valley up in Enga province. So those recommendations are taken on board.”

Since last year, Porgera landowners have conducted a number of public protests to demonstrate their opposition to Barrick’s continued involvement in the mine.

They have complained about lack of compensation for environmental damage caused by the mine over almost thirty years of operation.

Mr Marape urged landowners to maintain composure while the government concludes its discussions with the mine operators.

His government is seeking a greater share in the mine.

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