Tag Archives: St Barbara

Can the Solomon Islands’ Gold Ridge Mine serve as a new model for resource extraction in the South Pacific?

The coastline view near the capital, Honiara. Photo by Paul Hilton/Greenpeace.

Catherine Wilson | Mongabay | 15 November 2017

  • After 17 years of foreign ownership and a checkered environmental history, the Solomon Islands’ Gold Ridge mine is now being led by a local landowner-driven joint venture.
  • The company saw its first major test in April 2016, when rainfall triggered a spillover from the mine’s tailing dam. However, independent tests found the water quality downstream remained safe.
  • Though concerns still remain, the new ownership structure could be a model for mining operations elsewhere in the region.

In April 2016, thousands of villagers living in the vicinity of the Gold Ridge Mine in the southwest Pacific nation of the Solomon Islands braced themselves for a major disaster as torrential rainfall triggered a spillover of thousands of cubic meters of untreated water from the mine’s tailings dam.

The Ministry of Health issued instructions to people to cease using water from the nearby Kwara, Tinahula and Matepono rivers for drinking, washing or fishing, due to possible risk of chemical contamination.

The gold mine is situated on the country’s main island of Guadalcanal, 40 kilometers (25 miles) from the capital, Honiara.

Stanley Holmes Vutiande, who lives in Navola village, located along the Gold Ridge Road leading to the mine and 2 kilometers (1.2 miles) from the dam, remembered when it happened.

“We fled because there was water overflowing from the dam and we thought it might burst, so people just panicked and took off,” he recounted. “There was general information to look for safety, for higher ground, but no specific instructions as to what to do.”

Joe Horokou, the environment and conservation director at the Ministry of Environment, said the incident “was bad because it took us by surprise,” even though the company had been given approval to discharge tailings from the dam. “The approval was given with conditions like before it is discharged the water has to be treated to acceptable standards.”

Despite the dire warning, the expected disaster didn’t materialize. The dam held, and stakeholders, including Gold Ridge Mining and the ministries of environment and health, commissioned numerous independent tests of nearby rivers and streams.

“Based on the findings of those analyses we were able to determine that, even if the water was discharged untreated at the time, it caused no immediate harm to the downstream communities … the water quality was safe within the dam,” Horokou said.

Vutiande also said that, at the time, he noticed nothing of concern in the water quality of the Tinahula River near Navola.

A palm oil plantation in the Solomon Islands. The land used to be grassland and bush. Photo by Lorette Dorreboom/Greenpeace.

The incident was the first major test for the new landowner-led company, Gold Ridge Community Investment, which had taken ownership of the mine only the year before. After 17 years of foreign ownership and a checkered environmental history, the Gold Ridge mine is now being led by a local landowner-driven joint venture that is emerging as a potential new mine management model in the Pacific Islands region.

In 2015, Gold Ridge was sold for 100 million Australian dollars ($73.8 million at the time) to Gold Ridge Community Investment (now Gold Ridge Mining), by its Australian owner, St. Barbara. The company decided to abandon the mine, which contains an estimated 3.18 million ounces of gold, in the wake of extensive damage caused by Cyclone Ita and flooding the previous year.

The mine hasn’t been operational since, but following the signing of an agreement with Australia-based AXF Resources, which will provide the majority of investment, plans are now in place to resume extraction by the end of next year.

Walton Naezon, chairman of the landowner-led Gold Ridge Mining, said he is now keen to both reduce any risk the tailings facility poses to the surrounding environment and communities, and to increase public transparency of the company’s environmental processes. The top priority, he said, is dewatering, or emptying out the dam to ease pressure on its wall and decrease the chance of any further overflows.

Naezon spoke to Mongabay about implementing his vision of an extractive project where local communities are part of the corporate structure. About 3,000 to 5,000 people live in villages surrounding the mine, and traditional landowners own 30 percent of the company. They have already participated in making key decisions, such as the selection of an independent environmental consultant. They also observe operations at the tailings dam and take part in the company’s environmental testing and monitoring of nearby rivers and streams.

Larger than life in a blue Pacific print shirt, Naezon is bullish in his drive and optimism about the enterprise when we meet in a Honiara hotel. But he also comes across as astute, widely informed about the industry and its issues, and attuned to the sensibility and needs of his own people. No doubt this is a product of his previous career in politics, as well as skills and grasp of the cultural context as a traditional leader. He was minister of mining and energy from 1997 to 2001, minister for state government until 2003, and minister for commerce for another two years.

Naezon is visibly relaxed about the attention given the mining industry worldwide by what he refers to as the “greens” movement, commenting that it “makes the developer and company stronger.”

The revived Gold Ridge venture, at this stage, comes across as more than ticking the right boxes in order to be assessed a responsible corporate citizen. There is evidence of an attitudinal shift, a genuine motivation to alter the structure of power, participation and accountability.

The Gold Ridge Mine tailings dam in Guadalcanal Province, Solomon Islands. Photo by Catherine Wilson for Mongabay.

Community Involvement

As I stood in the water treatment plant at the edge of the vast blue expanse of the dam, reflecting the brilliant tropical sun, Gaheris Porowai, the supervisor, readily answered questions. He said that we were looking at 1 million to 2 million cubic meters (264 million to 528 million gallons) of water, with the water level currently 1.5 meters (5 feet) below the spillway. Treated water was being discharged, as permitted, at 500 cubic meters (132,086 gallons) per hour or 12,000 cubic meters (3.17 million gallons) per day, with water testing conducted twice weekly.

This will be done persistently, Naezon said, until the dam is empty.

“There should be no water there. In the next two years, no water, we don’t want to see water there,” Naezon said emphatically, adding that Golder Associates, the company responsible for the dam’s construction has also been reengaged to review its current state and potential future.

Phil Fairweather, Gold Ridge’s general manager, said that he and many other people had been attracted to the venture by the vision of building an enterprise on greater transparency, community inclusion and social and environmental sustainability.

“Any dewatering that is happening at the moment, for example, involves the communities,” Fairweather said. “It actually involves unqualified community people coming and observing the testing, coming and being involved in community awareness prior to any discharge and during.”

Local village chiefs, landowners and students are all invited to visit the tailings dam to learn about the water treatment process and witness its discharge.

“We want to see the mine open, but the health and safety and environmental responsibility is an utmost priority to us,” said Robert Rafaniello, the company’s deputy CEO. “And that is why as we lower the water, we will do more investigations into the stability of the dam, assess it. Does it need any strengthening to future-proof it for any other unknown event? Do we use the tailings dam in its current form, do we look at alternatives?”

Tropical forest, Vella Lavella, Solomon Islands. Forests cover more than three quarters of the country’s land area, but illegal logging remains a serious problem. Photo by Lorette Dorreboom/Greenpeace.

In hindsight, the lack of continuity in the mine’s foreign corporate ownership since the late 1990s — and intermittent periods of closure resulting in inconsistent environmental practices — can be seen as factors in the problems being experienced today.

The start of mining in 1998, by the Australian company Ross Mining, coincided with the stirrings of civil unrest. The mine was forced to close a mere two years later when the violence escalated. While a peace agreement was achieved in 2003, Gold Ridge didn’t reopen until 2010 after acquisition by Allied Gold. The venture changed hands again in 2012, this time to St. Barbara. Then, in April 2014, calamity struck when a cyclone and torrential rain caused massive flooding that damaged mine infrastructure, raising concerns about the stability of the tailings dam and forcing a second shutdown. Losses and damages at the mine amounted to $27.7 million, 26 percent of the total economic impact of the disaster on the country.

Soon after, St. Barbara decided to exit the country, selling the mine and its legal liability to Gold Ridge Community Investment the following year, while the Solomon Islands government declared the site a disaster zone.

A model for the region?

The Solomon Islands is not the only Pacific Island state to experience environmental problems in the mining industry.

Natural and mineral resource extraction has, over decades, generated major revenues in a number of other countries in the region, such as Papua New Guinea and Nauru, while many more are now considering the lucrative potential of deep-sea mineral extraction. But in both island states the extractive industries have been plagued by environmental disasters. Both have failed to achieve environmental sustainability, and the economic windfalls have not led to substantial improvements in human development.

Glaring examples include the Panguna copper mine in Bougainville, Papua New Guinea, where the fallout from the destruction of land and waterways nearly 30 years ago remains unaddressed; as well as the OK Tedi copper and gold mine in the country’s Western Province, where massive discharge of mine waste into local river systems since the mid-1980s decimated fish and animal species and contaminated water sources and farmland. In the tiny state of Nauru, aggressive phosphate extraction has ravaged 80 percent of the country’s landscape.

In the Solomon Islands, the government is looking to mining as the next big revenue earner as it faces the challenges of post-conflict economic recovery and the exhaustion of commercial forestry after decades of unsustainable logging. The country is known to have significant mineral resources, including gold, silver, nickel and lead.

“The Gold Ridge mine reopening is very important for the government and Solomon Islands as it contributes significantly to the economy,” a spokesperson for the Ministry of Mines, Energy and Rural Electrification told Mongabay.

Nevertheless, the economic, social and environmental success of mining ventures over the next generation depends on not repeating the problems of the past.

A 2013 UNDP symposium on managing extractive industries in Pacific Island states highlighted some of the steps needed to overcome the hurdles. These include conducting better consultations with stakeholders and communities, developing a more complex understanding of customary land tenure, improving the transparency of political processes and revenue management, and achieving greater commitment to environmental protection, over and above the basic requirement of developers producing environmental impact assessments.

Expert observers have also expressed concerns about the influence of corruption and limited capacity of the government to manage the demands of regulating and overseeing mining activities.

Logging road in a deforested area in Vangunu Island. Photo by Paul Hilton/Greenpeace.

“Too close an identification of political leaders with resource extraction companies has not served Solomon Islands well,” Graham Baines of the Bergen Pacific Studies Research Group has written (pdf). “The chance to build an economy based on sustainable timber production has been lost. And just as government institutions have been shown to be ineffective in controlling logging abuses, so, too, their role in guiding and controlling mining is weak and compromised.”

Recently the government has tried to address some of these issues with the launch of a new National Minerals Policy (2017-2021). It aims to guide reformed financial practices, industry oversight, and procedures for tailings management, corporate environmental audits, biodiversity management and the mitigation of deforestation and soil erosion.

“With the policy now launched, the ministry is working closely with the World Bank to begin implementing the policy, and this process is already under way, focusing mainly on the regulatory framework,” the Ministry of Mines spokesperson confirmed. This includes reviewing resource and manpower capacity and rolling out public outreach and awareness of the new policy.

Progress in these areas is vital to turning around the suspension of the Solomon Islands by the Extractive Industries Transparency Initiative (EITI), which in March of this year sanctioned the country due to assessed deficiencies in areas including licensing procedures, monitoring and control of production, and revenue distribution.

The revival of the Gold Ridge mine will bear witness to how much progress the government has been able to make in the short term.

In May, the government and company began consultations with landowners about the mine’s proposed reopening next year, seeking to address issues such as royalties and environmental impact.

There is evidence, though, that not everyone is satisfied and local environmental concerns persist.

Vutiande said that in Navola, “the water system was always a long-term concern since the opening [of the mine] by the previous companies. The water issue is an ongoing issue. There were a few times when there were people who found things that have died in the river, such as fish and frogs.”

Despite the company’s stated commitment to transparency, Gold Ridge Mining remains tight-lipped while it considers the range of options for dealing with mine waste. The decision as to whether the dam will continue to be used is still to be made, and the government is still awaiting the environmental management plan.

The contents of these will be the first step in translating the new Gold Ridge vision into reality and establishing, or debunking, its standing as a model for the rest of the region.

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New Ireland refuses to sign Simberi MOA approved by NEC

State Solicitor’s office accused of dishonesty 

Sharon Lowa | Post Courier | May 22, 2017

The New Ireland provincial government has refused to sign the Simberi Gold Mine memorandum of agreement recently approved by the National Executive Council (NEC) in April.

Deputy governor and chairman for natural resources in the provincial executive council Ambrose Silul said they are sick and tired of being misled by the state team negotiating the new MoA for both Simberi and Lihir Gold Mines.

Mr Silul insists that the state keep its word, and until it does, the New Ireland government will not sign any new MoA.

The New Ireland team had been renegotiating the Simberi MoA for over four years and a provisional MoA had been agreed in 2013, but that it was conditional on approval by the PEC.

“Our team wrote to the state team and Mineral Resources Authority (MRA) on October 6, 2013 that the draft MoA must include the provisions approved by the New Ireland PEC on May 21, 2013.

“That includes increasing the rate of royalties from two percent (FOB) annual revenues to 10 percent, as well as similar increases in the special support grant and tax credit scheme,” Mr Silul said.

Mr Silul further stated that the state solicitor’s office agreed that the changes the New Ireland government wanted made to the MoA would be included in the draft to go to the NEC.

He said that in a meeting in April 2015 in Kavieng, the state solicitor agreed they would include New Ireland’s provisions in both the Lihir and Simberi MoAs and allow the NEC to make a final decision.

“All we are asking is that NEC – and not the state bureaucrats – decide on the merits of our suggestions. Instead, we have a bunch of bureaucrats making decisions that should be made by NEC.”

“We will not accept this dishonesty on the part of the state team,” Mr Silul said.

Mr Silul is calling on the mining minister to conduct an immediate investigation into this affair.

The MRA mining coordinators and the state solicitor’s office deliberately and willfully misled the NEC by submitting an MoA that did not include the provisions they promised would be included.

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Solomons landowners discuss concerns on reopening gold mine

The over-full tailings dam facility at the Gold Ridge Gold Mine on Guadalcanal in Solomon Islands in January 2015. Photo: copyright Dr Matthew Allen – ANU

Landowners on Guadalcanal in Solomon Islands have been consulted about the proposed reopening of the Gold Ridge gold mine.

The mine was closed in 2014 after massive floods and its ownership was then transferred from the Australian owner St Barbara to a local land-owning company Guadalcanal Community Investments Ltd.

Guadalcanal Community Investments Ltd is now working with Chinese-owned Australian property developer AXF Group which plans to have the mine operational by the end of 2018.

Bringing the gold mine back to life is also a major policy objective of the government which says it wants to do it right.

Members of landowning communities discussed a range of issues with government officials and company representatives relating to royalties, security, environmental impact, revenue sharing and the relocation of people.

They were assured by both the government and the company that their concerns would be taken onboard and addressed to ensure a smooth reopening.

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Newcrest begins exploration on Tatau island

The National aka The Loggers Times | May 2, 2017

THE Newcrest Mining Limited is conducting exploration on Tatau Island in New Ireland for copper and gold deposits.
In its recently released quarterly report, it said exploration had begun on Tatau Island as part of Newcrest’s option and farm-in agreement with St Barbara Limited to look for copper-gold porphyry-related deposits.
Tatau is an island in the Tabar Group to the east of New Ireland and about a mile south of Simberi Island.
According to Newcrest, target generation exploration is presently being conducted over several priority porphyry target areas to define future drill targets.
In a recent interview, New Ireland Provincial Government Mining, Lands and Commerce director Brian Hosea told The National that the provincial government was in consultation with Mineral Resources Authority regarding the project.
“We are in consultation with MRA. That is still on the drawing board,” Hosea said.
“We need to have things in place like briefing the Governor (to see) where we want to go. We also need to have all agreements signed – landowner agreements, memorandum of agreements, integrated benefit packages to do with the project.”
The province has Newcrest’s Lihir gold mining project and St Barbara’s Simberi operation. Nautilus Minerals is also developing the first seabed mining project in the province.
Hosea had previously said NIPG had been working closely with local landowners as the province will now play host to three mining projects.
He said the provincial government is aware of the importance of local participation in the mining projects.

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Gold Ridge Mine miting long Honiara

Delegesen blong gavman, Gold Ridge CLC an GRML i miting long Honiara ( SIG photo)

Sam Seke | ABC Radio | 26 April 2017

Solomon Islands gavman, Gold Ridge Community and Landowners Council (GRCLC) and kampani blong hem, Gold Ridge Mining Limited i gohet fo expresim strongfala tingting fo maen hem stat baek moa.

Gold Ridge Mine long Central Guadalcanal wea hemi only gold mine olsem long Solomon Islands kamkasem distaem, hem bin klos daon bihaen bigfala flad long 2015 wea hem spoelem tailings dam.

Australian Mining company St Barbara wea hem onam maen long taem ia, hem salem kampani ia long lokol landona kampani Goldridge Community Investment fo 100 Australian dollar nomoa an olketa i lusim Solomon Islands.

Long yestede, gavman hem holem miting wetem olketa evri grup we i involv long maening ia fo talem aot olketa plan an aweanes long plande eria  bae olketa i karem aot long olketa komiuniti. 

Chairman blong Gold Ridge Mining Limited, Walton Naezen hem se kampani hem hapi wetem kaen aweaness fo mekem evri waka fo openem bae maen hem gohet gud.

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Solomon Islands govt signs agreement to restore mining lease

The over-full tailings dam facility at the Gold Ridge Gold Mine on Guadalcanal in Solomon Islands in January 2015. Photo:  Dr Matthew Allen – ANU

Radio NZ | 9 March 2017

The Solomon Islands government has withdrawn last year’s cancellation of the mining licence for Gold Ridge Mining Ltd.

This effectively restarts efforts by landowners and the new majority shareholder, Chinese-owned Australian property developer AXF Group, to re-open the Guadalcanal mine.

In a statement the chairman of the cabinet sub-committee on Gold Ridge said the minister cancelled the mining lease because he felt the previous owner St Barbara’s sudden departure breach of the Mines and Minerals Act, and the Mining Agreement.

The miner’s departure from Gold Ridge followed complications around flash floods in April 2014, which compromised the mine’s tailings dam and impeded access to the mine.

St Barbara however, has repeatedly denied abandoning the mine.

It stands by its transfer of ownership, via the sale at a nominal amount, to local landowning company Gold Ridge Community Investments Ltd.

The Australian miner also denied claims by GCIL following the sale that it had saddled the local landowner company with all the environmental liability of the closed mine.

Following the signing of the agreement with government to restore the mining licence, GCIL’s chairperson, Walton Naezon, said landowners would be working closely with their chosen investor and the government to restore the mine to profitability.

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Solomon Islands mine begins long road back to production

The over-full tailings dam facility at the Gold Ridge Gold Mine on Guadalcanal in Solomon Islands in January 2015. Photo: copyright Dr Matthew Allen - Australian National University

The over-full tailings dam facility at the Gold Ridge Gold Mine on Guadalcanal in Solomon Islands in January 2015. Photo: copyright Dr Matthew Allen – Australian National University

The new owners of the Gold Ridge gold mine in Solomon Islands plan to begin reconstruction of the closed mine within the fortnight.

Radio New Zealand | 27 February 2017

Rehabilitating the mine, which was abandoned by its last owner St Barbara in April 2014 after massive flooding, is a major task which includes the reconstruction of washed out roads and bridges to restore access to the mine.

However, work has been delayed by a falling out between the ministry of mines and the minority shareholding landowners company, Guadalcanal Community Investments Ltd.

Its chairperson, Walter Naezon, said this resulted in the mines minister cancelling their mining lease last year.

“We actually looked at this and [we] understand that the land was held by the land owner, the PE [Perpetual Estate Title] of the land, so how can he cancel the mining lease. You can do that with a foreign company but since the landowners took over 100 percent of the mine I don’t think you can cancel it. So those are the misunderstandings. We have settled that.”

Mr Naezon said it had taken several months but the dispute has now been resolved and the majority shareholder, Chinese-owned Australian company AXF Group is expected to begin rehabilitating the mine within the fortnight.

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