Tag Archives: Ramu nickel mine

Gold is Stolen on a Massive Scale in PNG

Sam Jay Kaupa | PNG Blogs | 

There is a question that people need to ask. Why can’t the Central Bank of PNG buy gold to curb smuggling and also build the reserves to stabilise the plummeting Kina?

The mining sector accounts for about 9% of the GDP and the overall resources sector contributes about 26% of the GDP. This will continue to rise with the current demand for cobalt which as a by-product of the mix hydroxide precipitate from the Ramu Nickel.

Copper is on the rebound with nickel and so is gold which is now hovering above $US1,300/oz. Gold price will continue to go up according to analysts and from graphical representations from Kitco (where I get most of my data from)

Currently, gold is stolen on a massive scale in PNG Mines. Gold production from mines is under-reported. This is a massive scam. For example – 20 million ounces were mined from the giant Porgera Gold Mine and bullions shipped off-shore by helicopter to Mt Hagen and by private jet to Perth almost every few days over the last two and a half decades.

Who from the IRC, Customs, Treasury or the MRA checks the exact amount of gold that is shipped out?

NO ONE – I MEAN NO ONE.

The MRA gets a little piece of paper called Form 25 where minerals exported are recorded from the Registered Mine Manager (who are all expats for the big mines)

That information is not enough. It is criminal to accept as gospel unverifiable sales records, especially for gold shipments.

Then the Treasury department relies of this MRA record of sales to project future revenues and plug that into the budget. The same info is shared with the BoPNG and other agencies.

For God’s heavenly grace – why can’t we have some of these fat lazy public servants at the point of exits like the helipad in Porgera to physically weigh, record and sign off on all gold shipments? Guess we caught the late bus. Tough luck now. 20 million ounces out the back door.

The other mines like Lihir and Ramu Nickel are doing the same thing. The PNG government does not have people on the ground like what I used to see everywhere in Africa where I used to work. They are everywhere. They are everywhere because that’s where the money comes in from. It’s not rocket science. You don’t collect revenue for the government by sitting in air-conditioned offices and pray for God’s interventions? Get your fat bums out and get your smooth fingers dirty.

So the bottom line is gold is stolen everywhere. It’s prevalent.

Why on earth does the BoPNG even give licences for companies to export gold?

“Bank of PNG should buy the gold instead and put the money there (in gold) instead of reserving the dollars alone. They should reserve dollars and gold together to stabilise the Kina starting with the artisanal gold market.

As an example, the Tanzanian government has a prolonged spat with Barrick fully owned subsidiary Acacia over a $190 billion tax bill for its mining operations in the East African nation. Exactly the same thing they were doing in Porgera until the Government found out and back-calculated the tax owed to them. So what I’m saying here is doable if the PNG government is serious in recouping lost revenue.

In 2017, that government passed laws to reform their mining sector that the industry complained would be costly and onerous.

In PNG when such laws are proposed, the industry backed by the PNG Chamber of Mines bitterly contests because they want PNG to continue to become an impoverished nation. And this is strongly supported by PNG government agencies (you know who they are).

But I tell you, one day, one friggin day this will change and the people of PNG will take back their resources and develop it with decent developers so that the benefits will trickle down right to the doorsteps of the people whose faint cries are always ignored by greedy people.

Don’t mess with God’s people. One day they will rise and the stealing will cease.

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Rising tide of opposition to large-scale mining in Papua New Guinea

Porgera Landowners protest against Barrick Gold (2018).

PNG Mine Watch

Opposition to large-scale mining in Papua New Guinea is becoming more and more visible as communities become much more vocal in expressing their anger and disapproval.

Both existing and proposed new mines are feeling the heat from landowners who are realising the benefits they are promised are illusory and it is they and their families who suffer the severe negative environmental and social consequences of large-scale resource extraction.

Landowners in Enga have lodged a US$13 billion claim against the government over unfilled promises and environmental and social damage from the Porgera mine. The miner is owned by Barrick Gold and Zijin Mining and has been operating since 1989.

Meanwhile landowners in Madang are petitioning the government not to allow a planned K5 billion expansion of the Ramu nickel mine and they want the existing Basamuk refinery shut down. Again, it is the lack of tangible benefits and the environmental and social costs that are angering local people.

Proposed new mines in Morobe and the Sepik are also facing opposition.

Last week, landowners in Morobe forced the evacuation of the site of the proposed Wafi-Golpu mine. They are unhappy at the terms of an MOU agreement signed by the government with the mine owners, Harmony Gold and Newcrest Mining.

The landowners protest is supported by Morobe governor Ginson Saonu, who has already declared his opposition to the mine:

“People are not like before, when they had no knowledge, no idea, no education to read what’s happening in other parts of the world where there is environmental damage and so forth. Everybody is knowledgeable about what’s happening in other mines around the world, and even in Papua New Guinea like Ok Tedi, Bougainville and others.

The governor has identified agriculture and tourism as better development options in his Province.

At the same time, the Morobe Provincial government has passed a resolution rejecting the MOU for the mine and landowners living along the coast have declared their opposition to the planned dumping of toxic tailings in their seas.

The proposed Frieda river mine, to be developed by the Chinese company Guandong Rising Assets Management, is also facing strong opposition from landowners worried about the impacts of mining on the Sepik river, which is their lifeblood.

Communities have been organising their own protest meetings and have banned Mineral Resource Authority representatives from entering some areas.

Similarly, communities around the abandoned Panguna mine on Bougainville, have successfully petitioned against any moves to reopen the mine, forcing the Autonomous Bougainville Government and governor John Momis into an embarrassing climb down.

In another blow to the mining industry, Nautilus Minerals is on the brink of financial collapse, unable to complete preparations for its proposed experimental seabed mine, Solwara 1. Local communities and environmentalists have been waging a long running campaign against the mine.

Although the PNG government still seems determined to press ahead with new mining operations, the resistance from local communities, both those affected by existing mines and those threatened by the new operations, shows no signs of abating .

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Ramu mine stake to change hands in overseas deal

Cobalt 27 Capital to acquire Highland Pacific

Mining Technology | 2 January 2019

Cobalt 27 Capital has signed a scheme implementation agreement (SIA) to acquire all of the issued ordinary shares in Highlands Pacific which it does not already own through a scheme of arrangement (SoA).

Currently, Cobalt 27 is the largest holder of Highlands shares, with an interest of around 13%.

As per the terms of the SoA, shareholders of Highlands will receive A10.5 cents cash per share, provided all applicable conditions are being met or waived and the scheme is being implemented.

This consideration represents a premium of 43.8% over the closing price of Highlands shares on 24 December 2018 of A7.3 cents and takes the equity value of Highlands to around A$115m ($80.9m).

The consideration will increase by A1.0 cents cash for every share to A11.5 cents, provided before the end of this year, the closing spot price of nickel exceeds $13,220 per tonne over a period of five consecutive trading days.

This SoA will need the approval of 75% of shareholders of Highlands who are entitled to vote. Voting will take place at a shareholder meeting, which is expected to be held in mid to late April this year.

Additionally, the scheme will have to be approved by the PNG National Court.

The major asset of Highlands is its 8.56% interest in the Ramu nickel-cobalt mine (Ramu), located near Madang in Papua New Guinea.

After repayment of Highlands’ attributable construction and development loans for the Ramu project, its ownership will increase to 11.3%.

Ramu is majority-owned and operated by Metallurgical Corporation of China (MCC).

MCC holds a 67.02% stake in MCC-JJ Mining that owns all of MCC Ramu NiCo (MCC – Ramu), which inturn holds 85% joint venture interest in Ramu.

The Government of PNG and local landowners own 6.44% stake in Ramu. This stake would increase to 8.7% following repayment of construction and development loans.

MCC financed and constructed the Ramu mine for $2.1bn.

Cobalt 27 chairman and CEO Anthony Milewski said: “The acquisition of Highlands will allow Cobalt 27 to gain a direct interest in the Ramu nickel-cobalt mine and materially increase its attributable exposure to the mine’s nickel production from 27.5% to 100% and cobalt production from 55% to 100%, relative to the previously announced Ramu Cobalt Nickel Stream.

“It does so at nearly half the cost of the previously announced Ramu Cobalt Nickel Stream, provides increased balance sheet flexibility, and enhances value for Cobalt 27 shareholders. It also brings cash flow to our business, something we have told our shareholders was important from the beginning.”

In October 2018, Highlands announced that MCC is exploring a potential expansion of the Ramu mine, which could cost around $1.5bn. The details with regard to a potential expansion, however, have not been finalised yet.

Cobalt 27 expects to have the opportunity to take part in any potential expansion and boost its attributable production through its purchase of Highlands following the SoA.

Highlands has interests in the Star Mountains Copper Gold exploration project in PNG and is reviewing the Sewa Bay laterite nickel project in PNG along with Sojitz Group, a Japanese trading firm.

Cobalt 27 plans to review strategic alternatives with regard to these non-core assets.

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PNG government rethinking China mining deal after opposition

Radio New Zealand | 13 December 2018

Papua New Guinea’s mining minister says the government is looking at changing parts of a mining deal struck with China.

In November, China and PNG signed a $US148 million memorandum of understanding to extend the Ramu nickel mine’s refinery in Madang’s Basamuk Bay.

But more than 1,000 locals are now threatening to shut down the Basamuk refinery if their demands aren’t met.

They want funding for a local highway extension and other local benefits from the Chinese developer, the Metallurgical Corporation of China.

The minister, Johnson Tuke, met with landowners on Tuesday and said he’s now raising their concerns with the company.

“There are some terms and conditions of the MoA might change and the treasury department are waiting on certain terms and conditions of the physical responsibilities too.”

The petitioners have given the government until 19 December to respond to their demands.

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Petition to Stop the K 5 Billion Ramu Nickel Extension Project and Shut Down of Basamuk Refinery

On Saturday, 01 December 2018, we the landowners and the mine-impacted communities of Basamuk held a public forum at Ganglau Village.  I did education and awareness on:

  • The 2019 Budget, the Medium Term Development Plan III (2018 – 2022) and where Rai Coast is positioned in these plans;
  • The recently held APEC Meetings and some of the decisions that came out of that which will affect the people; and
  • The APEC gift K5 Billion Deal MOU signed on 16 November 2018 between PNG’s Mining Minister Hon. Johnson Tuke and the Chinese Government for Ramu Nickel Extension Project.

Following the forum, 1215 people signed a petition to stop the K5 Billion Extension Project and even shut down the Basamuk Refinery and limestone mine if the Government fails to hear us.  For thirteen (13) years, our voices have not been represented in Parliament and have been suppressed because we’ve been told to raise such issues through our elected MP and the landowners association.  For obvious reasons, our voices get drowned between Cape Righy and Godawan.

This time, with the support of five (5) elected Ward Members, we’ve formed The Basamuk People’s Voice which complements the petition by the four (4) LOAs from Kurumbukari to Basamok.  We have been deprived of our natural justice enshrined in our National Constitution and Directive Principles for far too long.

Our petition is directed to the Minister for Minister for Mining Hon. Johnson Tuke, and copied to the Prime Minister, Hon. Peter O’Neill, Minister for National Planning, Hon. Richard Maru, Governor for Madang Hon. Peter Yama, Minister for Provincial Affairs, Hon. Kevin Isifu, President Ramu Nico Management (MCC) Ltd Mr. Gao Yongxue, and the Chairmen of the 4 landowner Associations from Kurumbukari to Basamok.

OUR PETITION

Dear Honourable Minister,

SUBJECT:  PETITION TO STOP THE K 5 BILLION RAMU NICKEL EXTENSION PROJECT AND SHUT DOWN OF BASAMUK REFINERY

We the landowners and the mine-impacted communities of Rai Coast and Astrolabe Bay Rural LLGs, and particularly the Basamuk landowners, of Rai Coast District of Madang Province hereby present this letter of petition to you as Minister responsible for mining, the Prime Minister Hon. Peter O’Neill, the National Government and the Madang Provincial Government.

During the APEC Summit on 16 November 2018, you signed an MOU with the Government of China, witnessed by our Prime Minister and the President of China, Xi Jinping, for a K5 Billion Ramu Nickel Mine Extension Project deal.

We the people of Rai Coast say NO to the use of our land, sea, rivers, limestone and people for the Extension Project unless our demands are met.

Our people have not benefited from key infrastructures nor socio-economic development for over 13 years since the Chinese first set foot at our doorstep.

We therefore demand the following from the Government:

1.       ROAD (MADANG TO MOROBE BORDER)

We demand urgent and priority funding for the missing link Madang-Morobe Coastal Highway, which will connect Madang to Basamuk and beyond.  In the PNG Development Strategic Plan 2010 – 2030, this area has been identified as one of the 10 economic corridors, with big economic potential but most disadvantaged.

Rai Coast District has huge economic potential in Agriculture, Tourism, Fisheries and MSME.  For example, statistics from Cocoa Board shows that Rai Coast District has the highest number of cocoa fermentries and we produce the most cocoa in Madang Province.  We need this key infrastructure to open up the resource-rich Madang-Morobe coastal economic corridor.

Since PNG joined China’s “One Belt One Road” (OBOR) Initiative, we have seen the Government build massive infrastructures in Port Moresby City.  We have seen Billions of Kina Chinese-funded new road networks in the Highlands, hospitals and agriculture projects.

We the Rai Coast people have been hosting the Chinese for 13 years.  Their State-owned company MCC’s biggest footprint is in our villages, our seas, rivers, and the air.  Yet we have ZERO major high impact infrastructures, the most obvious one being the road.

The sea continue to be the graveyard for hundreds of Rai Coast people.  We continue to take this risk every day.  The District’s social indicators are very low.  Lack of infrastructure, transport and access to energy hinder us from economic participation.

Minister, this time we will not allow any further Extension Project and we will also shut down the refinery if the Government does not start building our road and bridges as of 2019.

2.  ENVIRONMENTAL IMPACT AND ASSESSMENT

We demand an independent assessment by environmental professionals on the impact of the Mine on the people, their livelihood and the environment.  This must not be sponsored by the Company nor done by CEPA, as they have compromised and failed us over a decade.  There is a Court Order for 3-monthly assessments that has never been adhered to.

We demand the Government to immediately review and stop the special permission granted to the company to burn heavy oil for electricity.  We understand this heavy oil is banned in rest of the world.  We demand an urgent independent assessment into the quality of air from sulphur dioxide and nitrogen dioxide air emissions.

We demand the company be held to task to immediately produce hydro-power from the many rivers we have and even serve electricity with the people as per the Government’s rural electrification agenda.

No health baseline study has ever been conducted to date.  Human use of sea and fish tissue is not analysed.  The medical and safety standard of the mine is appalling.

3.  RELOCATION

Permanent relocation of people away from the hazardous refinery area to Yalau Plantation and the development of Yalau Township as one-stop LLG Town and Service Centre for the District.

4.  REVIEW OF FISCAL INCENTIVES

We demand an urgent review and cessation of the fiscal incentives of 10-year tax holiday given to the Developer.  This tax holiday has effectively transferred wealth from Papua New Guineans to China.

The Developer must now pay taxes and this be utilized under Infrastructure Tax Credit Scheme for vital infrastructures like roads, schools, health facilities and Infrastructure Development Grants for the mine-impacted Districts.

5.  ISSUES WITH EXISTING MINING LEASES AT BASAMUK

We have existing issues that the Government and the Developer has failed to resolve.  Some of these matters have been raised by the Four (4) Landowner Associations in their petition of 21 November, 2018 to you.

For Basamuk, notable is the landownership issue which the State’s decision and the Developer’s ignorance has caused.  The Basamuk land dispute was gazetted in the National Gazette in 2001 (G169 of 2001).  The land was exempted from Government’s Compulsory Acquisition process in 2002 (G51 of 2002).  This decision was held by the National Court in 2007.

Both GoPNG and the Developer are illegally operating on our land.

Both GoPNG and Developer did not conduct due diligence to identify the land gazetted as Volume 27 Folio 142, containing an area of 87 hectares acquired for Mining purpose.

This is different to Volume 26 Folio 65, identified by registered survey File No. 12/257 containing an area of 83.989 hectares, erroneously referred to as Mindre Portion 109 that contains the modified survey of Basamuk, which falls short of the original survey.

Mindre and Basamuk are two different lands.  The Government did not properly acquire the land and the documents/evidence we have on hand indicates fraud on the part of the State, contempt of Court and the Developer illegally residing on our land.

We therefore demand the State to immediately look into this matter, have it resolved and pay the parties concerned compensation as stated in Section 53(1) and 53(2) of the Constitution.

We now give the State 10 working days to respond to this petition.  If we do not hear from the State nor get a positive response for further discussions, our next course of action will be to:

(i)       Completely stop any Extension Project.

(ii)      Shut down Basamuk Refinery as it is illegally operating on our land, in contempt of Court.

We are optimistic that the Government will respond favorably to our petition.  We understand the PNG-China relationship and look forward to further dialogue with your Department, the Madang Provincial Government and the State.

…………………………………………….

END OF PETITION

  • Petition letter signed by Chair of The Basamuk People’s Voice – Ms. Kessy Sawang
  • Press Conference on this held in Madang town on Wednesday 05/12/18.
  • Hand-delivered to all parties
  • Chair had good meeting with Mining Minister.  He assured me that we’ll have a meeting with relevant agencies Tuesday 11/12/18
  • Petition due date is 19 December, 2018
  • The petition will be made online and we ask as many people as possible help us petition and socialize this matter.  Please help us fight for our rights.

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Governor Orders Probe Into Ramu Nickel Mine

Gorethy Kenneth | Post Courier | November 28, 2018

MADANG Governor Peter Yama has commissioned a team of environmental experts to immediately conduct an environment damage assessment on the Ramu nickel mine.

Mr Yama announced this yesterday after raising serious concerns on how the Conservation and Environment Protection Authority (CEPA) has handled the environmental damages surrounding the Ramu Nickel Project in Madang.

“It would be irresponsible for me as governor for Madang not to outline to my people the provincial government’s stand on the current and future operations of the US$2.1 billion Ramu Nickel project,” he said.

At the end of 2012, the company completed full construction and started full operations, and was now operating at its peak.

Mr Yama had noted the landowners of Ramu Nickel project’s concern over:

  • The environmental impact, Ramu Nickel project is having on their lives; and
  • The lack of infrastructure, and social inclusion in the sustainability of their lives.

“These issues are serious and the state of the environment is currently unknown, I am aware that Conservation and Environment Protection Authority has not been monitoring the discharge of deep-sea tailings for a couple of years, posing a major threat to our marine environment.

“As such I have immediately commissioned a team of environmental experts including marine biologists to conduct an environmental damage assessment to better place me to seek redress.”

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Landowners want Ramu mine to shut down

The National aka The Loggers Times | November 23, 2018

LANDOWNERS of the Ramu Nickel mine in Madang have petitioned the government to shut down mine operations following the signing of a K5 billion extension programme last week.
Landowner association chairmen representing landowners of project impacted areas in Bundi, Usino and Raicoast petitioned the Government through Mining Minister Johnson Tuke to shut down mining operations within seven days.
Their reasons were that Ramu Nickel management and Government did not take into the account interest of landowners before they signed the agreement for mine expansion.
They said they did not know the content of the agreement.
The copy of the petition was presented to Ramu Nickel yesterday.
Kurumbukari Landowners’ Association chairman Tobby Bare said signing of the K5 billion mine expansion took them by surprise.
Bare said there were a lots of issues that needed to be raised and captured in the agreement before signing.
The landowners raised several issues related to unfair distribution of spin-offs, rising social problems, and equal participation in project development in the petition.
The petition also included concerns about delay in the mine’s memorandum-of-agreement review.
Bare said landowners felt they were marginalised on their own land.
Raibus Group of Companies chairman Steven Saud said the K5 billion expansion was like “erecting another mine within the mine”.
He said over the last 13 years since the company started operations, landowners had learnt a lot.
Saud said there were certain things the company and Government should have done to meet expectations of landowners but had failed to do so.
Ramu Nickel management yesterday said the MOU signing done on Nov 16 in Port Moresby was “a high level understanding to demonstrate commitments by both PNG and Chinese governments to support the company’s expansion plan”.
“It is obvious that there is gross misunderstanding among ourselves that led to landowners issuing such threats, and making baseless allegations against the company,” the management said in a statement.
“However, we are committed to engaging with landowners in a mature and responsible manner and respond to each allegation levelled against the company.”
The management said the MOA review for the mine would take place once all stakeholders prepared their position papers. The MoA review would be due on December 13.

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