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Bougainville imposes moratorium on Panguna mine over fears of civil unrest

The Panguna mine, located in the east of Papua New Guinea in the Autonomous Region of Bougainville, was at the centre of Bougainville’s decade-long civil war.

In dramatic policy turnaround, government determines people feel Bougainville Copper Limited doesn’t deserve a social licence to run the controversial mine

Helen Davidson | The Guardian | 10 January 2018

The Bougainville government has enacted an indefinite moratorium on renewing the licence of a controversial mining company over fears it could reignite violent civil conflict.

In December Bougainville landowner groups were called to vote on allowing Bougainville Copper Limited (BCL) to renew their mining licence and potentially reopen the Panguna mine, but the vote was split.

“If we went ahead now, you could be causing a total explosion of the situation again,” the Bougainville Autonomous Government (ABG) president, John Momis, told the ABC on Monday.

The Panguna copper mine was central to the civil war and blockade in the 1990s that killed tens of thousands of people. Conflict escalated after landowners protested environmental damage by the mine and the lack of economic benefit for local people.

The Rio Tinto-owned BCL was forced to close the mine, and discussion in recent years about reopening it has sparked hostilities in the nearby communities.

In June protesters blocked Momis and other political leaders from accessing Panguna to sign an agreement with landowners, which the ABC reported would have opened the way for BCL to work towards returning.

Legislation passed in 2015 gave traditional landowners greater ownership over resources as well as powers over the establishment or reopening of mines, but confusion and division remains.

At the time of the BCL vote local journalist Aloysius Laukai reported Momis said mining by any company would be “untenable” under the circumstances. However on Monday Momis told the ABC the moratorium only strictly applied to BCL, not other potential operators.

The moratorium is a dramatic turnaround in policy from the ABG, which determined people felt BCL didn’t deserve a social licence to run the mine.

The ABG owns a 36.4% share in BCL, and has consistently said reopening Panguna was essential for the island’s economic self-sufficiency if it is to become independent.

Luke Fletcher, the executive director of an Australian-based NGO, Jubilee, said it wasn’t clear if the turnaround was “a temporary retreat or a permanent change of direction”.

“It could be they’re just biding their time for another couple of years, or they’re considering opening Panguna with other operators,” Fletcher said. “It does seem the intention is still to reopen the mine.”

The Papua New Guinea government is the only other major shareholder after Rio Tinto left in 2016. It has said it will give its 17% share to Bougainville, making the ABG majority shareholders of a company that has just one project – a mine over which the ABG has now placed a moratorium.

BCL is yet to be officially informed of the moratorium, but learned of it through media reports.

The company’s Port Moresby general manager, Mark Hitchcock, said it had sought further clarity, as it still “firmly believed” it had strong support among landowners.

“Hitchcock said previously held community forums led by the ABG had also demonstrated strong majority support and this reflected the company’s own experiences on the ground,” a spokesman told Guardian Australia.

“He stressed that BCL was a local company majority owned by the people of PNG, including Bougainville and had always acted in good faith after being invited to enter a new process for the redevelopment of Panguna by the ABG and landowners.”

BCL claimed it had support from eight of the nine landholder groups, as well as the Special Mining Lease Osikaiyang Landowners Association. It said minority elements – and competing mining interests – were disrupting consensus.

There were disputes with the association’s chair, Philip Miriori, BCL said, citing a letter from 367 authorised customary heads who disputed Momis’s characterisation of the vote as a “narrow divide”.

The customary heads told PNG’s Post Courier the meeting was given a submission signed by 320 of the heads giving their support to BCL.

As the resource-rich country moves on from civil war and towards independence, it is increasingly looking to mining for its economic future.

West Australian company Kalia Ltd recently announced it had signed a land access agreement with north Bougainville landowners, allowing the start of a “full-scale exploration program”.


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Momis announces moratorium on Panguna mining and exploration

Panguna copper mine on Bougainville … the catalyst for decade-long civil war. Image: Aloysius Laukai/Bougainville Forum

Aloysius Laukai | Asia Pacific Report | 23 December 2017

The President of the Autonomous Bougainville Government, Chief Dr John Momis, has announced an indefinite moratorium on exploration and mining in Panguna.

He said the Bougainville Executive Council had its meeting on Wednesday made a “thoughtful and considered” decision to impose an indefinite reservation moratorium from any exploration or mining over Panguna in the best interest of the landowners and the people of Bougainville.

The council debating the issue following advice from the Bougainville Mining Advisory Council.

“It is with much regret that the basic requirement for obtaining the landowners consent under the Bougainville Mining Act 2015 could not be met,” Momis said.

The voice of the Panguna landowners was clearly heard during the mining warden hearing that decided in a narrow split between those supporting the mine reopening by Bougainville Copper Limited (BCL) and the opponents.

Dr Momis also said that to develop the mine by any other developer would be “untenable” under current circumstances.

“We will not allow this project once again to reignite the wounds of the Bougainville crisis and distract our focus for restoring peace and our preparation for our referendum in 2019,” he said.

Continued consultations

While imposing this Panguna moratorium, Dr Momis said his government would continue to consult with Panguna landowners and the people of Bougainville over an “appropriate arrangement” or best alternative models of development of the mine if the people still had an appetite to develop the mine in the future.

The Bougainville Civil War was fought in 1988-1998 between Papua New Guinean military forces and secessionist guerrillas of the Bougainville Revolutionary Army (BRA).

The conflict led to an estimated 15,000-20,000 deaths on Bougainville before a peace agreement was brokered by New Zealand in 1998. This led to the establishment of the Bougainville Autonomous Region Government.

Bougainvilleans are due to vote in a referendum on possible independence in June 2019.

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Bougainville and Brazil linked by the disastrous consequences of mining: UN

The polluted Jaba river on Bougainville

UN Environment Assembly moves to curb pollution from extractive industries

UN Environment | 14 December 2017

The city of Mariana, Brazil, and the town of Panguna in the autonomous province of Bougainville in Papua New Guinea, occupy two diametrically opposed parts of the world, separated by more than 10,000 miles.  

They have distinct historical differences, dating several centuries ago, but in a very unique way they share a common story and destiny: that of the adverse effects of a well-intentioned exploitation of natural resources gone awry.

While few inhabitants of both urban centres may have interacted with each other, they have a common story to tell about the disastrous, and often unintended, consequences of natural resource extraction. 

Both settlements experienced the worst mining disasters in their respective countries and highlighted the need for integration of local communities in the planning and execution of extraction of natural resources.

In Panguna, the discovery of copper deposits in 1969 heralded the establishment of what was then the world’s largest open-pit copper mine, which began production in 1972. However, and unbeknownst to many locals at the time, a dispute over revenue-sharing and mine waste management between the local community and mine-operators, would lead to a protracted armed conflict which cost nearly 20,000 lives. 

Despite the official end of the conflict in 2001, Panguna is still grappling with the disastrous effects of the mining.

“Even though the mines and logging on our island produced hundreds of millions of dollars in profit the island didn’t become prosperous. Less than one per cent of the profits of the mine went to local communities. The mine had an enormous impact on our capacity to produce food and access safe water,” said Helen Hakena, the director, of the Leitana Nehan Women’s Development Agency, in Bougainville, during a side event at the Third UN Environment Assembly on 4 December.

“The mine polluted our water and redirected our economy,” she said. 

“Even now much of the population is exposed to mercury used by artisanal miners, including pregnant women, who access the gold. We have a high rate of birth complications and deformities as result,” Hakena added. 

Alluvial miners at work on Bougainville

Alluvial miners at work on Bougainville

Similarly, in 2015 Brazil experienced its worst mining disaster when two dams, owned by the Samarco mining company, collapsed and spewed forth their iron-ore mine waste into nearby rivers including the Rio Doce – an important river basin in southeast Brazil. 

The incident affected communities along the approximately 650 km course of the river, disrupted livelihoods and necessitated a $250 million clean-up operation by BHP Billiton, which jointly run the Samarco mining operation together with Brazil’s Vale mining company.

Inhabitants of both Mariana and Panguna, and numerous other mining communities around the world, are likely to benefit from a UN Environment Assembly resolution aimed at curbing pollution. 

The resolution, which was passed on 6 December, urges governments, and corporations, to work closely with local communities to ensure pollution is addressed.

The resolution aims at strengthening efforts to integrate conservation and sustainable use of biodiversity in various sectors such as agriculture, fisheries and aquaculture, tourism, mining and energy, infrastructure and manufacturing among others. It also points to the need to prevent and reduce pollution from these sectors.

“A new paradigm needs to be promoted: people and planet over profits. It is crucial to have responsible mining and sourcing of metals. There is need for a convergence of ethics and views among governments, business and society as well as the reform of production systems and practices that currently benefit only a few so that they can benefit many people,” said Ligia Noronha the Director of UN Environment’s Economy Division. 

David Granger, President of the South American nation of Guyana, echoed that message in his statement to those assembled for the side event: 

“The world’s natural resources are the patrimony of humanity,” Granger said.

“People therefore, must be at the heart of the development of our natural resources. In the final analysis people must come before profits. The pursuit of profits has been accompanied over the past century by an exponential increase in extractive industries. This expansion, however, has aggravated environmental damage which can have a long lasting and harmful negative impact on human dignity and well-being. 

“Pollution in the extractive industries threatens environmental security.” 

The event coincided with the release of a report on mine tailings dam failures. The publication, Mine Tailings Storage: Safety is No Accident, was jointly produced by UN Environment and GRID-Arendal.

It highlights six case studies of mine tailings dam failures dating back to 1985 and recommends the establishment of a UN Environment stakeholder forum to facilitate international regulation of dams.

Among the most recent major incidents highlighted include the Mount Polley, western Canada, when a mine storage facility failed in August 2014 and 25 million cubic metres of waste water contaminated Lake Polley. 

It also assessed the impact of the 2015 Samarco incident in south-east Brazil when approximately 33 million cubic metres of mine waste travelled 650 km to the Atlantic coast and disrupted water supplies for hundreds of thousands of people.

The side event was attended by delegates from communities that have been affected by mine waste pollution. They talked about some of the adverse, long-lasting and negative effects on their water, land and lives. Representatives of the private sector were also in attendance. 

John Atherton, a director at the International Council on Mining and Metals, said electrification of the mining industry holds “great promise” of cleaner extraction and called for “shared responsibility” in ensuring the reduction of pollution.

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Bougainville landowners back rival consortium to take over controversial Panguna copper mine

People supporting a rival mining consortium hold anti-BCL signs at the Panguna mine site. (Facebook: Me’ekamui)

Eric Tlozek | ABC News | 11 December 2017

The Bougainville Government is holding a crucial mining warden’s hearing at the abandoned copper mine which sparked a decade-long armed insurgency against the Papua New Guinea Government.

Key points:

  • RTG Mining chairman Michael Carrick says a proposal by the Central Me’ekamui Exploration Limited consortium is more realistic and “for the benefit of the people of Bougainville”
  • But BCL company secretary Mark Hitchcock says the consortium’s conduct is “less than honourable”
  • Bougainville’s Mining Secretary Shadrach Himata says all landowners will be asked for their views

The hearing will help determine if the company Bougainville Copper Limited (BCL), which was forced to abandon the Panguna mine in 1989, should retain an exploration licence for the site.

The Bougainville Government now owns part of Bougainville Copper Limited and wants it to redevelop the mine, but a rival consortium is challenging their bid, and said it has the support of key landowners from Panguna.

That consortium, Central Me’ekamui Exploration Limited, includes ASX-listed RTG Mining.

RTG’s chairman Michael Carrick said the group’s proposal was more realistic and better-supported by the people of Panguna.

“[It’s] a sensible and well-supported and economically deliverable proposal to develop the mine for the benefit of all the people of Bougainville,” he said.

RTG Mining has told the Bougainville Government that BCL’s exploration licence for Panguna has expired and legally cannot be renewed.

It wants the Bougainville Government to consider its application instead, saying the landowner association for the mine pit, the Special Mining Lease Osikaiyang Landowners Association (SMLOLA), backs its bid and would present a 2,000-signature petition in opposition to BCL.

“For the first time in 30 years a mining company has been endorsed and supported by the SMLOLA,” Mr Carrick said.

RTG Mining said longstanding resentment against BCL over the conflict and the ongoing environmental problems caused by their sudden withdrawal would prevent the company from being able to operate the mine again.

“The legacy issues for BCL are insurmountable,” Mr Carrick said.

He said the landowners would present a 2000-signature petition in opposition to BCL.

There is a legal dispute over who rightfully chairs the landowner association.

RTG Mining said the dispute had been settled with their preferred candidate, Philip Miriori, in charge; the Bougainville Government said the mediation had failed and that the matter is still before the courts.

PHOTO: The Panguna mine was abandoned in 1989 after an armed uprising known as the Bougainville Crisis. (AAP Image: Ilya Gridneff)

The Bougainville Government has also criticised the consortium for paying landowners who support them and implied it is not respecting the approval process.

“The Autonomous Bougainville Government (ABG) will not entertain companies who use the back door or break and enter through the window using self-centred individuals who think they have a monopoly over the people’s resources or represent their interests,” Mining Minister Raymond Masono said in a statement.

“… The ABG rejects companies that think they can bribe their way into people’s resources by giving certain individuals money to gain landowner consent.”

The ABG has had the PNG Government ban the key executive from Central Exploration, Sydney lawyer Renzie Duncan, from coming to Papua New Guinea.

Michael Carrick from RTG Mining says the consortium has been dealing openly with the Bougainville Government and that landowner payments are wages for its employees.

“The wages paid are in respect of services rendered to the joint venture,” he said.

“The joint venture is a commercial operation and landowners, like anyone else, are able to work and to get paid for their services.

“Our dealings with landowners have been completely transparent and professional.”

Mr Carrick said the intent of the travel ban against Mr Duncan appeared to be to help Bougainville Copper Limited.

“It is clear the ABG, on the appointment of the new mining minister, supported BCL and the temporary banning of Renzie, I assume, is designed to limit the support that could be afforded to the landowners of Panguna,” he said.

Bougainville Copper Limited is deeply unhappy with RTG Mining and its partners.

“We think they’re less than honourable in how they’re carrying on their conduct and their activities in the area,” BCL company secretary Mark Hitchcock said.

He said BCL’s licence application was legal, and wasn’t processed on time because the Bougainville Government wasn’t ready to implement the processes of its new Mining Act.

“The department didn’t have the resources to manage the application at the time it was taking place,” he said.

“It now has all those facilities in place.”

Landowners set to weigh-in on hearing

Mr Hitchcock said many landowners do support BCL, but are not being properly represented.

“From what we’ve seen, there is widespread support for mining in Panguna and mining with Bougainville Copper,” he said.

Bougainville’s Mining Secretary Shadrach Himata said all landowners will be asked for their views as part of the approval process, not just the leaders of the association.

“The warden’s hearing is a process that will engage the views of all the landowners in the resource areas,” he said.

“It won’t be affected by the leadership tussle of the SMLOLA landowners.”

Crucially, Mr Himata, said BCL is the only company currently being considered by the Bougainville Government.

“Right now, the only legal applicant on the exploration tenement is BCL,” he said.

“Until that process is completed, there are no other applicants or applications over the same tenement. That’s the position of Government.”

The eventual decision on the exploration licence will be made by the Bougainville Executive Council, the regional government’s Cabinet, probably sometime in 2018.

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Bougainville locals give thumbs up to RTG project; shares soar 83pc

RTG shares over the past month. Source: Investing.com

Melissa Yeo | Stockhead | December 6, 2017

RTG Mining hit 52-week highs on Tuesday after the junior explorer got the green light from Bougainville locals to start work on its copper and gold mine.

The historic partnership, the first of its kind in 30 years, pushed RTG shares as high as 34.5c before they cooled to 28c — a gain of 83 per cent for the day.

Consent from the traditional land owners is required for the issue of any exploration licence on their customary land at the Panguna 1.5 billion tonne copper and gold project on the central island of Bougainville, a process which has historically escalated to wide-scale political unrest on the island.

The region has long been known for its copper and gold prospects, but disputes between regional residents and explorers such as Rio Tinto subsidiary Bougainville Copper Limited (BCL) have marred production since the early 1970s.

Conflict between the Bougainville Revolutionary Army and Papua New Guinea Defence force escalated to a civil war in 1988 and took almost ten years to cease.

Now, the Autonomous Regional of Bougainville is seeking independence for its population of 250,000, with a target date of June15, 2019 set for a referendum on the topic.

They will be the ones to decide the fate of RTG’s application, now led by the traditional landowners, the Special Mining Lease Osikaiyang Landowners Association (SMLOLA) and chairman Philip Miriori.

“We believe the proposal presented by the SMLOLA consortium represents a unique and once in a generational opportunity to responsibly re-open the Panguna Mine for the benefit of all Bougainvilleans,” the company told the market.

“RTG has always suggested that this is best achieved by discussion and negotiation with all relevant parties, including the ABG.”

In 2016, Rio’s subsidiary BCL was forced to abandon the mine in the face of attacks by rebels, transferring its take to the provincial and national governments at no cost.


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Mothers Unite Against Re-Opening Bougainville Panguna Mine

Local residents hold banners and placards during a protest at the former Bougainville Copper Limited’s Panguna mine. | Photo: Reuters

teleSUR | 27 November 2017

The women noted that “foreign concepts” and exploiters supplanted traditional ways of life, resulting in the environmental catastrophe of the island.

Mothers Against Re-Opening the Panguna mine have released a statement championing traditional land rights of the Indigenous Black people of the South Pacific island of Bougainville in Papua New Guinea, expressing their emphatic opposition to re-opening the Panguna Mine located in the Guava Mountains.

Describing access to land as their “traditional birthright,” the women explained that their matrilineal lineage is a social reality which places them as custodians of the land, thus the need for them to make their voices heard in the vanguard, rejecting all attempts to re-open the mine.

The statement read, in part, that it was “women who led the protests against” Bougainville Copper Limiter, BCL, and Rio-Tinto, a British-owned mining giant, that operated the Panguna mine. Two decades later, which marked the beginning of the armed conflict in Bougainville, women continued to trigger the “anger of menfolk to take action,” they wrote.

The statement cited “violations of land rights, destruction of properties and traditional sacred lands, serious damage to the environment, deposits of toxic chemicals into the rivers, lack of shareholding and inadequate levels of royalties,” which gave way to the war which lasted from 1989 to 1998.

The women went on to note that “foreign concepts” and exploiters supplanted traditional ways of life and “Black concepts.” However, they added that they’re “no longer a race of people who are blind to be led by puppets who cannot wholly choose their destiny.”

A consortium of Australian investors, having coddled support from the Autonomous Bougainville Government and head of the landowners who own mineral rights, are now making their move to re-open and operate Panguna, once known as one of the world’s largest copper mines.

“If the independence of the people is to be sustained then we need Panguna to run,” said Raymond Masono, Bougainville’s Vice President, according to Reuters.

In 1988, Perpetua Serero, chairlady, of the Panguna Landowner Association, and her cousin, Francis Ona, led the newly formed group which championed indigenous landowner demands over BCL and the Papua New Guinea Government and that something be done about widespread pollution. Roughly a billion tons of waste had been deposited in the Jaba River, contaminating it with copper, mercury, lead, and arsenic.

However, when Applied Geology Associates, a New Zealand consultancy firm, attended a public meeting in the capital Arawa and released a report stating that BCL operations had caused no environmental damage, Ona stood up and slammed it as a whitewash.

“We were forced to become passive observers of our own exploitation, first by the racist colonial administration and after independence by the Black political leaders in white men’s coats,” Ona said. His cousin, Serero would also refer to the Black mismanagement class on the island as “self-centered traditional landlords, brainwashed by foreigners and minority elite nationals.”

Though Perpetua passed away shortly after the outset of the war, Ona would go on to lead the Bougainville Revolutionary Army, BRA, alongside his chief commander, Sam Kauona, which shut down the Panguna mine amid fighting with Papua New Guinea’s armed forces. As a result of their ex-colonial and mining interests in Bougainville, Australia supported Papua New Guinea’s war efforts by providing them with military advisors, trainers, helicopters, and helicopter pilots.

The armed conflict, which lasted from 1989 to 1998, claimed 15,000 lives on the island, roughly 10 percent of the population. Most of the deaths were attributed to the most insidious aspect of the war – the Australian and Papua New Guinea-backed naval blockade of Bougainville.

In a class action lawsuit against BCL and Rio-Tinto alleging war crimes, genocide, and crimes against humanity, former Papua New Guinea Prime Minister, Michael Somare, signed an affidavit stating, “Because of Rio Tinto’s financial influence in PNG, the company controlled the government.” Former Papua New Guinea military general, Jerry Singirok also signed an affidavit which stating, “The PNG military functioned as the corporation’s personal security force and were ordered by BCL to take action to reopen the mine by any means necessary.”

With necessity being the mother of all inventions, the war forced villagers to learn how to maximize locally grown crops, developed mini hydro-plants from spare car parts to supply energy throughout the island, established local medical centers of treatment and learning, and produced all that was needed to function as an independent nation. Far from achieving its goal of depriving islanders into submission, the blockade, in effect, rejuvenated the call for independence.

Bougainville, popularly known by its traditional name Me’ekamui (meaning “Sacred Land”), is scheduled to hold an independence vote on June 2019, according to Reuters. A quarter of a million people will decide whether to officially become the world’s newest nation or remain part of Papua New Guinea.

Australia has agreed to the independence vote on one condition, that the Me’ekamui Defence Force— a remnant armed force sprung from the war which, until this day, controls the no-go zone encompassing the Guava mountains overlooking the gaping hole where BCL once mined — lay down their weapons. Autonomous Bougainville Government officials have also been urged to resign mining contracts with BCL.

Ever the defender of his people’s land, a revolutionary precursor to the modern day environmental movement, Ona contended that people on planet earth “depend on land, depend on environment, and I wish to ask everyone, every leader of any nation to take care of the land so that people on this planet can be saved.”

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Panguna: What the future holds – according to BCL

“The plan has the backing of the Bougainville government and strong support among project area landowners”.

The National aka The Loggers Times | November 23, 2017

Q: Can you give a brief overview of Bougainville Copper Limited?
HITCHCOCK: It is an exciting new era for BCL as an independently-managed Papua New Guinea company.
We are listed on the Australian Securities Exchange (ASX) and the people of Papua New Guinea  and Bougainville have a significant stake with the governments of PNG and Bougainville being our two major shareholders.
As a company, our core objective is to work cooperatively towards realising the vision of resuming active exploration and sustainable copper, gold and silver mining at Panguna, in central Bougainville, after mining ceased in 1989 due to conflict.
The successful redevelopment of the mine will deliver broad economic and social benefits and that is a prospect we are excited about.
Along with our Port Moresby office we have established a full-time team in Bougainville with an office in Buka. We were pleased to hold our first board meeting there in more than 27 years in August.
We are fortunate to have a strong board with a wealth of experience in PNG and Bougainville and a capable management team.
The board was further strengthened by the recent appointments of distinguished Bougainvillean Mel Togolo, who has extensive mining industry experience along with Peter Graham.
Peter served as managing director of ExxonMobil PNG Limited which was responsible for the US$19 billion (K57 billion) PNG LNG project and is also the current chief executive of Ok Tedi Mining Limited.
The board also features former Prime Minister Sir Rabbie Namaliu, Dame Carol Kidu, and Sir Moi Avei and is chaired by PNG and international mining industry veteran Robert Burns.

Q: Can you explain BCL’s plans to reopen the Panguna mine and what will that entail?
HITCHCOCK: There is certainly a lot of work to do if the vision of a new Panguna project is to be realised.
Our approach is being guided by a redevelopment plan which has four distinct stages.
The plan has the backing of the Bougainville government and strong support among project area landowners.
We estimate that we are around halfway through the first stage (stage zero) and community and stakeholder engagement remains a priority focus.
We are increasing our presence in the project areas with our local engagement team led by well-regarded Bougainvilleans.
Community inclusion and support is essential to the redevelopment process. With the agreement of landowners, we intend to commence the necessary technical, environmental and social baseline studies that will guide further work.
We will also negotiate with landowners the benefits of mining as the project advances.
The third stage would see us conduct a bankable feasibility study and obtain the necessary permits and approvals with the final stage being the construction and operation of the mine.
We have sufficient financial resources to complete the first two stages and will look to secure additional finance to help fund the feasibility study and project construction.
The company has set realistic objectives and if mining is to recommence, it would be several years away.

Q: Panguna mine has a sensitive history surrounding its closure. How is BCL catering for this in its plans to reopen the mine and what has been the feedback?
HITCHCOCK: We and the global mining industry have learnt many lessons from the past but see a bright future for Bougainville and are committed to supporting that future.
There is a sensitive history. But given BCL’s long-standing involvement in both Papua New Guinea and Bougainville, it is something we understand and appreciate as a company.
We have, for example, always retained a positive local presence throughout the period of the mine’s closure.
We have continued supporting initiatives such as Bougainville Copper Foundation which has provided educational opportunities for more than 1000 Bougainvilleans since the mine closed and we continue to support other community projects and initiatives.
BCL is also a very different company today, with Rio Tinto no longer involved and the people of PNG and Bougainville effectively our major shareholders.
We are governed and regulated by the Autonomous Bougainville Government and will be shaped and guided by the Bougainville people.
Since returning to Bougainville, our direct engagement with stakeholders, including landowners, the government and the community more broadly has been positive, and BCL has been extremely well-received overall, including in central project areas.
That is not to say there are no challenges and there are of course people with differing views.
A dispute for example over the leadership of one of the nine project area landowner associations has added a layer of complexity to our engagement.
This is subject to an ongoing National Court mediation process and we are hopeful of a timely, satisfactory resolution.

Q: What are some economic benefits that will be gained from reopening Panguna mine?
HITCHCOCK: The project certainly has the potential to generate significant broad-based economic benefits. While it was a different time, when the mine last operated between 1972 and 1989, the production value represented around 44 per cent of Papua New Guinea’s exports, with a production value of K5.2 billion.
It also resulted in the training of some 12,000 employees, including many apprentices who helped build capacity in the PNG and Bougainville workforce.
Under the new Panguna project, the construction phase alone will cost an estimated US$4-6 billion (K12- 14 billion) and that will present a range of opportunities for employment and local business in the provision of goods and services.
The mine would also generate significant tax and royalty revenue over the 25 year plus operational life of the project.
There will be a need for certainty in relation to the tax regime that would apply.
Benefits will also be negotiated with landowners in project areas and shareholders will see dividends from their project equity.
A project of this scale will help stimulate the economy in different and significant ways, training and employment, new business opportunities in the supply of goods and services and the provision of new infrastructure to name a few.

Q: What are your views on the distribution of Rio Tinto’s shares by the PNG government and the Bougainville referendum in 2019?
HITCHCOCK: The exit of Rio Tinto saw its 53.8 per cent shareholding transferred to the ABG and the Papua New Guinea government, with each now currently holding a 36.45 per cent share as the major shareholders.
The PNG government already held a 19.1 per cent share.
Prime Minister Peter O’Neill had said that 17.39 per cent of the PNG government shareholding will be transferred to the people of Bougainville.
As an independently managed company, we will continue to serve all of our shareholders to the best of our ability. But the final configuration of the shareholding is not something we have expressed a view on.
In terms of the proposed referendum, that is very much a matter for the people of Bougainville and we will respect whatever decision they make.
We also, of course, fully recognise and support the Bougainville peace agreement.

Q: Mining companies usually partner with the province they operate in to bring about development. What are BCL’s plans for Bougainville in non-mining sectors such as agriculture and tourism?
HITCHCOCK: BCL certainly recognises the challenges that come through the impact of a large mining operation on a smaller, lesser developed economy such as Bougainville.
Therefore, we will do everything we can during the operating life to encourage and nurture a broader-based economy that can flourish when mining is finished.
The continued development of Bougainville’s other important industries, including agriculture and tourism and other services
are critical to future economic success.
In terms of our efforts as a company in mineral resources and given the potential scale of our operation, we certainly see ourselves complementing other sectors and providing impetus for them to grow.
For instance, redevelopment would lead to much improved infrastructure and services which other sectors and industries would benefit from.
Employment opportunities are a major dividend of growth and economic diversity and we are certainly committed to being proactive in these areas, working with government, local communities and industry to support initiatives
that support sustainable development.
The goods and services requirements of a major mining operation, for example, provide all kinds of opportunities for such things as agriculture in the provision of fresh food and it will also be a catalyst in areas like transport and accommodation.
When you build capacity, you put structures in place to then cater for growth in non-mining related industries such as tourism, you also promote local innovation and business which is something BCL is very keen to foster.

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