A PanAust delegation of seven met with Papua New Guinea Prime Minister the Honourable James Marape to discuss the nation-building Sepik Development Project that includes the Frieda River Copper-Gold Project and Frieda River Hydroelectric Power Project, amongst a multitude of other infrastructure projects that will enable the economic transformation of the north-western border region of Papua New Guinea.
In meetings with Honourable Prime Minister James Marape in Port Moresby last week, PanAust took the opportunity to elaborate on key aspects of the Project including its enormous economic impact, its job creation potential, the need to minimise environmental risks, and how it would have a catalytic impact on Papua New Guinea’s regional and national growth.
During the meeting, PanAust Managing Director and CEO Daling Zheng reiterated the company’s pledge to prioritise local hiring and procurement, ensuring that the benefits of the Project would be felt across the entire supply chain and within project impact areas and nearby communities.
He also emphasised Frieda River and PanAust’s dedication to environmental stewardship and ongoing community engagement, highlighting the company’s intention to operate in accordance with the highest environmental standards.
“On behalf of our shareholder Guangdong Rising Holding Group, I would like to say how grateful we are for being given the opportunity to engage in constructive dialogue with the Prime Minister and the Government of Papua New Guinea. As discussions progress, I want to restate that we remain steadfast in our commitment to fulfilling regulatory requirements and engaging in meaningful discussions with government stakeholders and local communities.
“The Sepik Development Project represents not only a significant investment in Papua New Guinea’s natural resource development history for us, but also a commitment to helping foster long-term growth and prosperity in the country. We believe that by working hand in glove with the government and local stakeholders we can unlock the full potential of this Project and create lasting positive change for generations to come,” Mr Zheng said.
Prime Minister Marape expressed his support acknowledging the Project’s potential to stimulate development of remote rural communities especially in the two Sepik Provinces.
“The project represents a significant opportunity to harness our natural resources responsibly and create lasting benefits for the people of Papua New Guinea.
“The broader Sepik Development Project has the potential to become a cornerstone of Papua New Guinea’s economic development strategy, attracting further investment in our northern region and bolstering our position in the global economy,” Prime Minister Marape said.
Frieda River Limited and PanAust remain dedicated to continuing to work collaboratively and transparently with the Papua New Guinea Government and the impacted and affected communities to ensure the Project’s success whilst upholding the highest levels of social responsibility, corporate governance, and sustainability.
Mining Minister Honourable Muguwa Dilu, has urged all landowners, impacted communities and stakeholders of the Porgera Mining Project, to fast-track the Community Development Agreement (CDA) process so that they could start receiving benefits.
The Minister was speaking in Tari on Friday April 26, where he addressed the Hides-Porgera Power Line landowners of the Porgera Mining project.
He said the Porgera Mining Project was a priority of the Marape-Rosso Government, adding that the government wanted to ensure that the mine goes into full operations immediately.
The meeting with the power-line landowners was the final one of a series of pre-CDA meetings, which the State Team has been conducting in the last few months, involving all landowners and stakeholders. The aim of pre-CDA meetings has been to provide the State’s response to the position papers, create awareness, clarify issues, prepare landowners and respond to specific pre-dominant agendas presented in position papers submitted by landowners and stakeholders.
The next step is to launch CDA proper in the coming weeks, after which, all parties and other stakeholders will convene at a venue to be announced soon, to negotiate benefits through the CDA process. Minister Dilu recently announced that the CDA proper would be held in May 15-30-2024.
The Minister told the power line landowners: "Yumi mas stretim olgeta hevi na wari blong yumi before long end of May-June."
He said all landowner groups were important stakeholders of the project, and that the government would ensure their position papers were considered.
He urged them to cooperate with the State Team and quickly find ways forward to addressing their positions on major potential benefit streams available to them such as equity and Business Development Grants.
He reminded the landowners however, that there were laws and policies governing the potential acquisition of benefits. He said the State would not negotiate benefits outside of laws and asked for understanding from landowners and stakeholders.
The Minister was accompanied to the meeting in Tari, by the Governor for Hela Province, Honourable Philip Undialu and the Managing Director of the Mineral Resources Authority (MRA) Mr Jerry Garry, who joined the State Team that had gone to Tari earlier in the week to conduct pre-CDA meeting.
Governor Undialu said his government and his people supported the Porgera Mining project. However, he urged the State Team to clearly define the various benefit streams and how exactly his government and his people would benefit, taking into account the various laws and policies that govern benefits distribution. His landowners expressed the same sentiments.
Ok Tedi Mining Limited (OTML) recently renewed its Special Mining Lease (SML) 1 (0), gaining an additional 20-year lease term from 2022 to 2042.
This is the second SML 1 (0) lease term extension for OTML.
During the momentous event on 23th April, the Minister for Mining, Hon. Muguwa Dilu, encapsulated the rich history, significant achievements, and promising future of one of Papua New Guinea's premier mining ventures.
Hon. Dilu said: “As an SOE (State Owned Enterprise), OK Tedi has been paying healthy dividends to the state every year, thus contributing to the economy, government revenue and improving livelihoods in communities around PNG.”
“Last year, OTML announced that the mine’s life will be extended to 2050 and a potential future income of K30 billion. So it was not hard for the government to renew the Special Mining Lease for OK Tedi because the old SML had expired. The granting of the new SML will now allow OTML to continue operations for the long term,” he added.
The process, initiated SML 1 (0) lease, was granted in 1981 and expired in May 2002, but was extended for another 20 years until its expiration in 2022.
An application for the renewal of the SML 1 (0) and associated leases for mining purposes in compliance with the Mining Act 1992 provisions was lodged with the Mineral Resources Authority on 20th December, 2021, resulting in the current extension grant.
Furthermore, the SML 1 (0) lease renewal includes renewal of 22 Lease for Mining Purposes (LMP) and two (2) Mining Easement, which are tied to the term of SML 1 (0).
The 24 ancillary leases host supporting infrastructure for the mining operations, while the SML 1 (0) lease is the host area for active mining and milling operations activities.
Minister Dilu reiterated: “The renewal of the SML clearly demonstrates the government’s confidence in OTML.”
According to the OTML update during the significant event, the Company is also currently carrying out its awareness sessions throughout its impacted communities in preparation for its Community Mine Continuation Agreement (CMCA) extension review, which is expected to be completed in October 2025 with the signing of the Agreement to continue mine operations.
Hon. Dilu likewise lauded the leadership of Hon. William Duma and regulatory support from the Mineral Resources Authority (MRA). Since commencing operations in 1984, OTML has transitioned from a gold mine to a prominent copper-gold operation, contributing substantially to the nation's economy and community development.
OTML's ownership structure underscores the country's commitment to empowering its people through resource ownership. Over the years, the company has made significant contributions to the nation's economy and local communities.
With 5.17 million tonnes of copper, 15.9 million ounces of gold, and 36.4 million ounces of silver produced since inception, OTML's operational growth is undeniable.
The company has made significant financial contributions to the state over the years, demonstrating its commitment to various stakeholders. This includes:
OTML’s current production, export volume earnings in 2022, OTML has contributed 3.6% of PNG’s Gross Domestic Product. In 2023, it declared a K450 Million Dividend, underscoring the company's substantial impact on the economy and local communities.
Hon. Dilu also expressed gratitude to the board, management, and staff for their dedication and resilience, especially during challenging times like the COVID-19 pandemic and drought.
Looking ahead, OTML's future is promising, the minister said, as the company is positioned for sustained growth. Strategic projects outlined in its business plan are expected to generate K30 billion in social benefits over the next 27 years, reinforcing OTML's role as a catalyst for economic development and community empowerment.
Minister Dilu added: “The Ok Tedi mine has been operating for 33 long years. OTML as a SOE has been operating for 22 years. We have history, we have experience, and as a business, the future is just fine. I want to see OTML grow in the following areas:
OTML Managing Director and Chief Executive Officer, Kedi Ilimbit, also spoke at the SML 1 presentation event at the Stanley Hotel in Port Moresby.
He thanked all stakeholders involved in furnishing the extension of the SML 1 (0), citing OTML’s gratitude and excitement in continuing to explore opportunities for sustainable resource development in the region while also providing social and economic benefits to its impact communities and the country.
Mr Ilimbit emphasized OTML’s commitment to fulfill the environmental, legal, and social obligations, maintaining positive relationships with the communities impacted by the company’s operations, and securing the social license to operate, which is vital for its ongoing success.
The Minister for International Trade and Investment, Hon. Richard Maru whilst officially launching the Lihir Investment Fund (LIF) in Lihir, New Ireland Province, challenged the current generation of Lihir to think of the next generation post mine closure.
Minister Maru said: “I have a fear that when all the gold in Lihir runs out, Lihir will become just like Misima- there will be a black hole and nothing here. This will become a reality unless the landowners, the people of Lihir, and the local Member and the Provincial Government think about the future of Lihir and do something about it. Our country has to learn from the past and not repeat the same mistake. We need to make sure to build sustainable communities beyond mine closure.”
Minister Maru provided the statistics of Lihir Island saying it currently had a population of about 60, 000 with half the population being children (up to 18 years old), 10, 000 in formal employment directly with the Gold Mine or with companies that were involved with the mine, and about 20, 000 unemployed.
“Whether you like it or not, Lihir already has 20, 000 people who are unemployed. The mine has not transformed their lives and given them opportunities. But we cannot blame the mine because a mine is not a big employer generator anywhere in the world. PNG LNG Project only employs 4, 000 Papua New Guineans. Today we have 8 resource projects operating in PNG, but we have the highest employment rate, highest problem with foreign currency, highest rate of law-and-order issues, our Kina value is so weak, and we have K60 billion plus debt. We have been so over dependent on the resource sector for the last 49 years and look at where we are now today; the resource sector has never been the answer for Papua New Guinea. So, the question is: what will happen to Lihir when the mine closes? The current generation of Lihir must think of the next generation beyond the mine life,” said Minister Maru.
Minister Maru told the Lihirians that there was a window of opportunity for them to do something today with well over 20 years left of the mine.
“This is the time for you to step up and talk about how we can chart a new future in the next 20 years you have left of the mine. We all know that Lihir gold is very expensive to extract but the price is also very good, and this is the time to talk to Newmont, your local Member, your Provincial Government, and the State about the future of Lihir,” said Minister Maru.
Minister Maru called on Lihirians to seriously look at establishing new sustainable industries.
“You must seriously look at new industries apart form the mine that must be located here which will make use of the wharf, and the electricity and water supply that you already have. What is stopping your company to establish a fishing business here in Lihir? You are sitting on some of the most fertile fishing grounds of the world. One cannery can produce 5, 000 new jobs. We do not have to continue to send 80 per cent of our catch overseas, we need canning industry here including in Lihir. These are sustainable industries beyond mine closure. Our Government plans to establish ten canneries in Madang. Why can’t we bring two here and make a deal with Newmont under a new chapter and do a feasibility study to have two canneries here? If it is viable then invest in it so you create jobs in Lihir post mine closure. When the mine closes, the fishing business will be here forever. You have over 20 years to go, and you now have a good investor (Newmont) so this is the time to talk to them about your future, and to talk about sharing the wharf, the power and water supply with them to bring industries that will be here to create employment and to sustain you beyond mine closure,” said Minister Maru.
Minister Maru further encouraged the Board and Management MRL Funds Limited to grow the capital to take advantage of the investment opportunities in PNG.
“I want to congratulate the Board and Management of MRL Funds Limited who, under their management, the assets of the Lihirian’s Equity Trust (LET) have grown from K430 million in 2006 to almost K700 million as at March 2023. Given the success of their management of the LET, we are happy that they are starting the LIF so that investors who make money from royalties and others can invest in this fund. This fund is basically for individuals and families. However, whilst I commend them, the start of this fund with a seed capital of K40 million is insufficient for any serious investments like the new hotel development at Paga Hill and other emerging investment opportunities as they will require more than K50 million investment. I want to encourage the manager and trustee of the LIF to open up shareholding for other Papua New Guineans to also buy units into the fund so they can grow the fund quickly and be able to invest in many exciting investment opportunities that will be emerging especially in the Special Economic Zones where we are giving special incentives including tax holidays,” said Minister Maru.
Minister Maru once again commended the Board and Management MRL Funds Limited for the launch of LIF and said it was very timely because PNG needed investment funds that Papua New Guineans could invest in. Minister Maru also assured them of the Government’s support.
“Lihir has been generating employment and tax for our country and we are grateful for that. We are concerned about your future and we are ready to back you. We have a responsibility to look after the communities who are now looking after PNG. There must be a new dream including sustainable industries in Lihir to sustain you. The fund that we are launching today must find its way back to building sustainable industries in this island. Let’s come up with a new dream- a new destiny for Lihir,” said Minsiter Maru.
Prime Minister and Treasurer Hon. James Marape has welcomed Mayur Resources Ltd securing funding of US$155 million (K540 million) to complete the Central Lime Project (CLP) at Kido in Central Province.
He made the welcome recently after Mayur announced to the Australian Stock Exchange (ASX) that it has secured the funding to complete Papua New Guinea’s first downstream manufacturing processing hub, with the potential to create hundreds of new jobs and be a major displacer of PNG’s imported lime products.
“I am happy to hear that Mayur Resources has secured the K540 million funding to complete the Central Lime Project, and that the project has the potential to create hundreds of new jobs, support service businesses, electricity, roads, education and health facilities for landowners,” Prime Minister Marape said.
“It promises to be a transformative development for Central Province landowners and the broader manufacturing sector.
“I thank Appian Capital Advisory LLP for a total of approximately US$115 million debt financing to Mayur Resources and Vision Blue Resources’ equity investment into the project of US$40 million announced in November 2023, which will see the Central Lime Project fully funded.
“The funding, I understand, will be used to cover construction costs to achieve an annual production capacity of 400,000 tonnes, along with an allocation for expected further expansion. First quicklime production is expected to begin after 18 months.
“Central Lime Project is one of the first approved Special Economic Zones (SEZs) which are a focus of my government.
“The establishment of CLP is a testament to my government’s commitment to supporting downstream processing and assisting in attracting investment funds into PNG’s first Single Factory Special Economic Zone.
“Such support now sets the scene for PNG to compete with the hundreds of billions of dollars already invested into Southeast Asian SEZs.”
Ok Tedi Mining Limited (OTML) is proud to announce a record production result for the first quarter of 2024, with an achievement of 26,114 dry metric tonnes (dmt) of copper (Cu), marking a substantial increase of 61% compared to the same period last year which was 16,265 dmt.
This record production has been complemented with a safe start to the year with a Lost Time Injury Frequency Rate (LTIFR) of zero (0) and Total Recordable Injury Frequency Rate (TRIFR) of 0.22 compared to 2023 with LTIFR and TRIFR recorded at 0.21 and 0.63 respectively. Unlike in the past, the strong production results this time was achieved with all environmental KPIs at the Mine, Mill and Bige dredging site being fully met.
This performance is a testament to the Company’s commitment to responsibly enhancing production, implementing strategic business improvements, and optimizing operational efficiency across the entire production chain, from mine and mill to the port.
These results are driven by OTMLs ‘restore, reset, and reinvigorate' strategy, launched in 2023 to revitalize our business operations.
Importantly, the Company remains committed to fulfilling our environmental, legal, and social obligations, consistent with its vision to maintaining positive relationships with the communities impacted by our operations, and thereby securing the social license to continue to operate, which is vital for our ongoing success.
Looking ahead, with the approval for the Mine Life Extension in principle up to 2050 by the OTML Board, the Company is poised for sustainable growth well into the future.
OTML is actively pursuing strategic growth projects aligned with our current Strategic Business Plan, which are progressing successfully and anticipated to generate K30 billion in social benefits over the next 27 years, including taxes, royalties, and dividend payments.
Our record production in the first quarter of 2024 underscores our commitment to excellence, innovation, and responsible mining practices, which are pillars of our Vision 2023.
We remain focused on driving value for our stakeholders while contributing to the sustainable development of our communities and the broader PNG economy.
Mayur Resources Limited is pleased to confirm that it has executed definitive debt financing agreements with Appian Capital Advisory LLP (Appian) for a total of approximately US$115 million. This financing, combined with Vision Blue Resources’ (Vision Blue) proposed equity investment into the project of US$40 million announced in November 2023, would see the Central Lime Project (CLP) fully funded. The funding would be used to cover construction costs to achieve an annual base case nameplate production capacity of 400,000 tonnes(a), along with an allocation for expected further expansion. First quicklime production is expected to begin 18 months after financial close.
Key Points:
Mayur’s Managing Director, Paul Mulder commented:
“Today marks the key funding milestone in delivering the CLP, which will be a transformative development for Papua New Guinea’s Landowners, Central Province and the broader manufacturing sector. Hundreds of new jobs, support service businesses, electricity, roads, education/health facilities are all part of the benefits that will be created for Landowners, whom to date, have lacked such basic services and have been negatively impacted by isolation. As the nation’s inaugural industrial downstream manufacturing processing hub, the CLP will also materially contribute to the clean energy transition by providing a key input to the processing of energy transition metals in the region.”
“The project has successfully attracted finance from both Appian and Vision Blue, bringing both debt and equity to the table in a first for PNG. This investment sets the foundation to showcase PNG’s vast potential for small to medium manufacturing projects connected to its natural resources.”
“The support provided by the PNG Marape-Rosso Government is a testament to their commitment to supporting downstream processing and assisting in attracting such reputable investment funds into PNG’s first Single Factory Special Economic Zone. Such support now sets the scene for PNG to compete with the hundreds of billions of dollars already invested into Southeast Asian Special Economic Zones.”
Appian Capital Advisory CEO & Founder, Michael W. Scherb commented:
“Appian is excited to partner with Mayur and Vision Blue on the Central Lime Project in Papua New Guinea. CLP is a leading asset, set to produce low-cost lime products for metal processing, strategically located close to end markets in Australia and Asia. The project will also play a pivotal role in highlighting foreign direct investment in PNG, supporting the country’s growing industrial sector. This collaboration showcases the ongoing success of Appian's dedicated credit and royalties offering, highlighting the significant value our team brings to the delivery of mining assets globally.”
Construction Activities
Construction of the CLP commenced in mid-2023 with primary activities to date being the wharf infrastructure. Commencing the wharf infrastructure early has allowed Mayur to optimise construction logistics and shorten the project’s development schedule. Additionally, the Company expects to generate early revenues through the sale of raw limestone aggregate from this wharf during construction of the kilns.
As Mayur has funded this construction to date, the Company will receive a reimbursement from the CLP project joint venture company. This reimbursement will add to Mayur’s working capital at the parent level.
Significant Lime Resource and Future Expansion Potential
Mayur has previously reported JORC Mineral Resource Estimates of 382Mt of limestone – all within the Mining Lease of the CLP(b). The original ‘base case’ definitive feasibility study used only 30Mt of this total resource, presenting extraordinary upside potential for Mayur and warranting future investment towards increasing the number of kilns at the Project beyond the two initially modelled, which has the potential to scale annual EBITDAs linearly with the number of kilns.
Further Disclosures
Further disclosure of the terms of the definitive financial agreement with Appian are set out in Annexure A. The terms of the agreements with Vision Blue were disclosed on 14 August 2023 and were finalised by way of definitive transaction documents on 6 November 2023. The Company notes that it has also provided details of the financing in converted A$ terms, but re-iterates the financing from both Appian and Vision Blue is expressed in US$ terms in the definitive agreements, and will be funded by both parties in US$ terms. The exchange rate used in these calculations is 0.66 AUD/USD.
PNG Minister for Mining Hon. Muguwa Dilu’s online participation in the recent launch of the Multilateral Minerals Security Partnership (MSP) Forum reflects PNG's eagerness to explore collaborative opportunities within the global mining community and potentially become a member of the Forum.
This inaugural event held on the 9th of April, in Leuven, Belgium has drawn attention from global stakeholders, including PNG, highlighting the country’s commitment to fostering international cooperation in the mining sector for sustainable development.
The MSP Forum is a multilateral cooperation platform within the framework of the Partnership, aimed at bringing together raw materials producing and consuming countries at various stages of development.
The Forum focuses on advancing and accelerating individual projects and promoting policies that contribute to resilient value chains and bring local value-addition.
Additionally, the Forum will be a platform for strengthened cooperation and policy dialogue with resource-producing countries. It will serve to support and accelerate mining projects and promote a policy dialogue to address the challenge of a secure, sustainable supply of critical raw materials for the green and digital transitions.
According to the MSP Forum, the policy dialogue will implement the objectives of the Critical Raw Material (CRM) Club proposed by European Commission President Ursula von der Leyen.
The idea is to create a dialogue between reliable partners to address the challenge of CRM supply and to assist resource-producing countries in their ambition to industrialize, building on those assets.
It was attended by 33 government representatives from prospective MSP members, including Minister Dilu, the US Ambassador to PNG Ann Marie Yastishock, and the EU Ambassador to PNG Jacques Fradin, who hosted them at the EU Delegation PNG office.
The MSP Forum, co-chaired by the European Union and the United States, signifies a collaborative effort to promote resilient value chains within the mineral sector.
With opening remarks from Mr. Valdis Dombrovskis, Executive Vice President of the European Commission, and Mr. Anthony Blinken, US Secretary of State, the event underscored the importance of international cooperation in shaping the future of mining practices.
Minister Dilu said the forum presents a unique platform for PNG to engage with international partners and contribute to sustainable mining practices in the country. The EU Delegation to PNG and the US Embassy in Port Moresby expressed readiness to assist PNG in becoming a member of the MSP Forum.
PNG CORE President Anthony Smaré said recently that PNG benefits from one of the strongest gold production monitoring regimes in the world and PNG should feel proud of its current regime in place.
“PNG's mining industry adheres to a very rigorous standard and comprehensive scrutiny by government agencies to ensure transparency and accountability in gold production and all of PNG's operating mines have been compliant to those reporting standards and scrutiny. PNG's regime is stronger than in Australia, Canada and the United States of America.”
All gold produced by PNG gold mines are subject to the scrutiny of government agencies including the Mineral Resources Authority, Bank of Papua New Guinea, Internal Revenue Commission, PNG Customs and PNGEITI.
Mines submit a monthly Mineral Return Form 25 stating details of minerals mined, commodity produced, clearance on each export shipment is sought from both the IRC and Central Bank and upon receipt of clearance by the Central Bank, PNG Customs then completes its customs declaration forms confirming consignment details prior to shipment for exports out of country.
As of 2020, MRA uses a live data monitoring digital platform which enables the authority and the government real-time information on mineral data and operations of all major mines in operation in the country. Australia, Canada, and the US do not have this level of supervision. The mines pay MRA over K50m in levies each year to ensure that the MRA is funded to implement its regulatory role.
In addition to the extensive government oversight, the industry also subjects itself to several independent verifications of gold quality and quantity through various third-party professional service providers such as assayers and stock exchange requirements. All gold producers are required by law to provide audited annual company production and financial reports to the stock markets on which they are listed in countries like Australia, Canada, the US, and China and to their shareholders and home regulators. Any inaccurate reporting of revenue or gold production exposes these companies and their officers to significant civil and criminal liability in those countries as well.
Considering recent unfounded comments against the mining industry on gold theft and malpractices by certain leaders, PNG CORE has formally written to Prime Minister Marape to express its disappointment over those comments and asking for evidence of any noncompliance to be presented.
"The industry is very concerned about these unfounded allegations of misreporting of gold production by PNG mines made by some individuals. If evidence of such misconduct exists, bring it forward so that those in breach are dealt with accordingly under PNG law. In the absence of such evidence, any allegation of industry malpractice regarding gold production and exports should be considered a false narrative designed to lay the ground for dangerous proposals like the flawed National Gold Corporation proposal and its foreign promoters to garner political support and be passed to the detriment of the country. The industry will look to legal action against anyone propagating this false narrative without substantiation."
PNG CORE remain committed to working collaboratively with government agencies and relevant stakeholders to address any concerns and ensure that reporting processes continue to meet the highest standards of integrity and accuracy.
The Papua New Guinea Chamber of Resources & (PNG CORE) reaffirms its dedication to transparent resource governance by actively participating in the Extractive Industries Transparency Initiative (EITI) process.
EITI serves as a crucial mechanism for enhancing accountability and promoting responsible management of natural resources worldwide.
PNG CORE recognizes the importance of Multi-Stakeholder Group (MSG) in driving forward the EITI process.
Comprising representatives from government, industry, and civil society, MSGs promote inclusive decision-making and facilitate dialogue to enhance transparency and accountability in the extractive sector. PNGEITI MSG - Government Agencies include the following: Department of Treasury, Department of Finance, Department of Petroleum and Energy, National Planning and Monitoring, Prime Minister & NEC, Internal Revenue Commission and Mineral Resources Authority to name a few.
In line with EITI objectives, CORE and its member organizations are committed to:
CORE recognizes that transparent resource governance is essential for promoting sustainable development and fostering trust among stakeholders. By actively participating in the EITI process and embracing transparent reporting practices, we demonstrate our commitment to responsible resource management and good governance in Papua New Guinea's extractive industries.
K92 Mining Inc. announces that it has commenced preparations to resume underground operations within two days, following the receipt of a letter from the Mineral Resources Authority (“ MRA ”) of Papua New Guinea vacating the Form 29 that was issued on March 13, 2024 (see March 19, 2024 Press Release ).
The receipt of the letter vacating Form 29, follows a presentation by an Independent Safety Auditor to the MRA. Findings from the audit indicated that the Underground Safety Management Plan is good, conforms to criteria in ISO45001 and has been implemented. The Safety Auditor also did not find any substandard document, process or system, and noted that the Underground Safety Management Plan is comparable to other operations in Australia and Asia.
John Lewins, Chief Executive Officer and Director stated, “Safety is, has and always will be K92’s number one priority, and I am pleased with the results of the Independent Safety Audit which are also a reflection of the significant investment and focus by the team on site, which has further intensified since mid-2023.
While we are pleased with the positive safety audit findings, I want to emphasize that K92 is always proactively striving for better and will continue to relentlessly pursue its goal of zero harm.”
The Company reiterates its 2024 Operational Guidance, and notes that the temporary suspension of underground operations since March 10, 2024 will have a moderate impact on Q1 and Q2 production.
The Philippines and Papua New Guinea (PNG) are eyeing possible cooperation on critical minerals and fisheries sectors, Foreign Affairs Secretary Enrique Manalo said Thursday.
After his bilateral meeting with PNG Foreign Minister Justin Tkatchenko, Manalo said the Philippines is eager to explore opportunities and “new forms” of partnership with the Pacific nation.
“On the economic front, we discussed greater cooperation on agriculture and fisheries, also in terms of downstream processing, (and) in critical minerals, such as copper or gold,” he said during a press conference at the Makati Diamond Residences.
Both the Philippines and PNG have vast amounts of gold, copper, and nickel deposits – critical minerals vital to producing clean energy technologies.
The Philippines has been increasing interactions with foreign governments and stepping up support for local mining industries to position itself as a key player in the global value chains.
“The two ministers have identified this (critical minerals) as a potential priority sector during their meeting earlier and discussions are in an exploratory stage,” the Department of Foreign Affairs said.
Manalo said Manila and Port Moresby are also working to renew and enhance an existing memorandum of understanding on fisheries.
“I can only see a very broad and expansive relationship developing from our discussions today. And I think the focus will be a lot in the areas of food security, agriculture, and also other ways of promoting food resilience,” he said.
‘Defense, security’
On top of these, the ministers saw the need to enhance cooperation on defense and security matters, but Manalo said this would still have to be discussed in more detail.
He said he “updated” Tkatchenko on the challenges faced by Manila in the South China Sea, where several coastal states have overlapping territorial claims.
“We are concerned with the situation in the West Philippine Sea,” Manalo said. “We do have a very common commitment on the importance of international law, adherence to international maritime law. And we both felt that it's only through this adherence to international law, on which nations can cooperate fruitfully and peacefully.”
Tkatchenko is also in the Philippines for the two states’ inaugural policy consultations, which aim to facilitate enhanced communication and coordination on bilateral, regional, and international issues of mutual interest.
Currently, Papua New Guinea hosts more than 35,000 Filipinos, mostly working as managers and supervisors, contributing to both the Philippine and Papua New Guinean economies and societies.
In 1975, the Philippines was among the first countries to establish formal diplomatic ties with the Independent State of Papua New Guinea after it was declared and recognized as a sovereign nation on Sept. 16, 1975.
Freeport Resources Inc. is pleased to announce that, with the recent Yandera license renewal through 2025, the Company has commenced an internal project optimization review while discussions continue with potential strategic partners to advance the Yandera Copper Project to Definitive Feasibility Study.
“There have been a number of new breakthrough advances in low-cost, direct sulphide leaching technologies since the Yandera Pre-Feasibility Study was completed in 2017. These new technologies allow for direct sulphide leaching at the mine site to produce a final copper cathode product, thereby eliminating the need for a costly concentrator and its attendant operating and transportation costs. The potential capital, operating and transportation cost savings are significant and could further strengthen the project’s economics and attractiveness to potential strategic partners,” commented Mr. Gord Friesen, Chief Executive Officer, Freeport Resources.
“While there already exists strong interest by strategic partners in Yandera driven by copper price’s move above $9,000/tonne and announcements by Chinese smelters of curtailed output due to shortages of copper concentrates, further improvements in the project’s economics would be a win-win for all parties, including shareholders. Yandera is one of the world’s largest undeveloped copper projects and ranks as the largest undeveloped copper project in Asia, the world’s leading copper refiner and consumer. Over USD $200 million has been expended on the project since 2005, culminating in a comprehensive 2017 Pre Feasibility Study delineating one of the world’slargest undeveloped copper resources.* With the extension of the exploration license through November 2025, timing for this internal optimization review is ideal. We are excited to have re-commenced work on the project in parallel with ongoing discussions involving potential strategic partners to advance the project through Definitive Feasibility Study and development of the mine. We look forward to updating shareholders as discussions progress,” concluded Mr. Friesen.
Yandera – One of the World’s Largest Undeveloped Copper Projects
Freeport Resources’ wholly-owned Yandera Copper Project is located in the highly prolific PNG Orogenic Belt, the same geological arc as some of the world's largest gold and copper deposits including Grasberg, Frieda River, Porgera, Lihir, Wafi-Golpu and Kainantu. Yandera is a project of strategic national interest in PNG and has the potential to become one of the country's most significant copper mines. The project’s proximity to Asia, the world’s largest copper refiner and consumer, positions Yandera as an attractive potential long-term source of copper supply.
The renewed license EL 1335 covers a 245.5 square kilometer (“km”) tenement comprising the Yandera Project. Approximately USD $200 million in exploration and development expenditures have been spent on EL 1335 since 2005. Work completed and studies funded to date include approximately 154,600 meters of exploration drilling, the vast majority of which has focused on the Yandera Central deposit, as well as scoping studies, engineering studies, environmental studies, the 2017 Pre-Feasibility Study*, and infrastructure-related studies.
The 2017 Pre-Feasibility Study titled, Independent Technical Report on the Yandera Project - PreFeasibility Study*, prepared by Worley Parsons, with an effective date of November 27, 2017, estimated a historical open-pit, Measured and Indicated Resources of 728 million tonnes grading 0.39% copper equivalent.
The internal project optimization review is part of Freeport Resources’ ongoing strategic review process aimed at maximizing the value of the Yandera Copper Project which the Company believes is significantly undervalued based on historical expenditures, current copper prices and the potential for resource expansion. The Company’s internal project optimization review will be led by Dr. Nathan Chutas, Senior Vice-President of Operations, who helped manage the 2017 Pre-Feasibility Study.
* Independent Technical Report on the Yandera Project – Pre-Feasibility Study, prepared for Era Resources Inc. and dated effective November 27, 2017. The study was prepared prior to the Company acquiring an interest in the Yandera Project, and is derived from historical estimates which the Company is not treating as current. This information is intended to provide readers with context on historical analysis conducted on the Yandera Project, however the Company cautions that a qualified person has not done sufficient work to classify any historical estimates in respect of the Yandera Project as current and any analysis conducted by previous owners of the Project may rely upon assumptions which are no longer reasonable or accurate in the context of the current market.
Yandera – Feasibility Study
The renewal of EL 1335, through November 19, 2025, allows Freeport Resources to commence work on a Definitive Feasibility Study to advance the Yandera Copper Project toward a Final Investment Decision. Concurrent with the Definitive Feasibility Study program planning, Freeport Resources has begun discussions with key international strategic investors and prospective partners for development of the Yandera Copper Project. Demand for copper is undergoing unprecedented structural change driven by the global energy transition with mined copper supply forecast to enter a deficit position starting as early as 2025 (see Copper Supply and Demand Imbalance Chart above).
The Definitive Feasibility Study will build on earlier work undertaken with local and regional communities to determine opportunities to achieve mutually beneficial partnerships and sustainable long-term social benefits related to job creation, indigenous advancement, health and wellness, environment, education and community development.
Freeport and the Community
The Yandera Copper Project is 95-km southwest of the capital city of Madang Province and 235-km to the northwest of Lae which is the largest port city in PNG and an important industrial center. As one of the largest undeveloped copper resources* in the world, the Yandera Project has the potential to support communities and create jobs along the Yandera Corridor. The Company anticipates the potential economic influence of the Yandera Copper Project could span 5 provinces and create wealth for generations including, but not limited to, strategic road and highway building, power generation and related infrastructure.
The landowners and communities of Yandera are stakeholders in the Yandera Project. The overwhelming community support that the Company received at the Warden’s Hearing held during the summer of 2023, demonstrated the level of commitment the people of Yandera have for the project. Freeport is also firmly committed to advancing the project and continuing support of the community. The Company expects to continue to develop initiatives to be an active and visible presence in the Community.
Private Placement
The Company also announces that it will conduct a non-brokered private placement (the “Offering”) of up to 100,000,000 units (each, a “Unit”) at a price of $0.05 per Unit for gross proceeds of up to $5,000,000. Each Unit will consist of one common share of the Company and one-half-of-one share purchase warrant (each whole warrant, a “Warrant”). Each Warrant will entitle the holder to acquire an additional common share at a price of $0.25 for a period of twenty-four months.
Proceeds from the Offering are expected to be used to continue development of the Yandera Copper Project, to advance the project optimization review, and for general working capital purposes.
In connection with completion of the Offering, the Company may pay finders’ fees to eligible third parties who have assisted in introducing subscribers to the Offering. All securities issued in connection with the Offering will be subject to resale restrictions for a period of four-months-and-one-day following issuance, in accordance with application securities laws. Completion of the Offering remains subject to the approval of the TSX Venture Exchange.
St Barbara Limited provides the following production update for the March 2024 quarter (Q3 FY24).
Simberi produced 17,257 ounces of gold in the March quarter, at an average milled grade of 1.63 g/t Au and gold recovery of 77%. Mill and rope conveyor availability are yet to reach targeted levels, however as anticipated mined grade improved during the quarter as the mine schedule accessed a higher proportion of ore tonnes from the higher-grade zones in Sorowar pit and reconciled positively.
Gold sales for the quarter were 18,016 ounces at average realised gold price of A$3,178 per ounce.
Total cash at 31 March 2024 was A$218 million (31 December 2023: A$214 million) despite paying down creditors balances relative to 31 December 2023 after improved operating cashflow and receipt of a tax refund in the Canadian subsidiary.
Further commentary on operations, including production costs and cash flow details, will be provided in the Q3 March FY24 quarterly report scheduled to be released in the week commencing 22 April. Managing Director and CEO Andrew Strelein said “Simberi again improved during the March quarter with gold production increasing 33% compared to the December quarter.
As previously highlighted in the December quarterly report, production guidance for Simberi was weighted to H2 FY24 and we remain on track with this solid quarter.”
Papua New Guinean shareholders of New Porgera Mine stand to receive well over K26 billion over the 20-year life of the mine, with more than K11 billion expected in the first 10 years, if gold price keeps at its current rate.
Prime Minister Hon. James Marape announced this after this latest meeting with Barrick Gold Corporation President and Chief Executive Officer Mark Bristow in Port Moresby.
This is the monetary value of the new agreement under Special Mining Lease 13 where Papua New Guineans own 51 percent and 49 percent is shared by Barrick Niugini Limited (BNL) and its joint-venture partner, Zijin.
As the new majority owners of New Porgera Limited, the State through its mining company Kumul Minerals Holdings Limited owns 36 percent of the shares, while 15 percent is being shared between Enga Provincial Government and the landowners.
“Previously, landowners shared a 5 percent equity with the provincial government; now under SML 13, there is nearly a 200 percent increase to 15 percent, including royalties. Comparatively, this is massive,” said Prime Minister Marape.
“At an assumed gold price of US$1,800 per ounce, PNG shareholders can expect to receive nearly US$7.2 billion (about K26.6 billion) over a 20-year mine life and US$3.0 billion (about K11.2 billion) in the first ten years. The current gold price is significantly higher at over US$2,150 per ounce.
“The share of equity and economic benefits that belong to the landowners is a first in PNG’s agreements with international investors.
“I have been confidently advised by Mr Bristow that the mine ramp up remains on track and is expected to reach full production before the end of the third quarter of this year.
“Porgera is forecast to reach production of approximately 250,000 ounces of gold in 2024, more than 400,000 ounces in 2025, and above 600,000 ounces in 2027 and years beyond, returning it to its Tier 1 status as one of the world’s largest gold mines,” said PM Marape.
The Prime Minister also highlighted that New Porgera Limited will be a significant contributor to the PNG Treasury, subject to a 32 percent corporate tax rate in return for fiscal stability under the Resource Contracts Fiscal Stabilization Act, including an increase in royalty from 2 percent to 3 percent.
The mine has rapidly increased the number of employees, with over 2,000 currently, of which 98 percent are Papua New Guineans, with 60 percent coming from Enga and 38 percent from Porgera. NPL expects to employ approximately 3,200 people by the end of this year.
This week, Cabinet approved a special joint military and police callout to secure the mine against a large illegal-miners threat because of PNG’s substantial shareholding interest in the mine.
Prime Minister Hon. James Marape has met with recently-appointed President and Chief Executive Officer of Newmont, Tom Palmer, in the National Capital recently.
Mr Palmer paid a courtesy call on PM Marape at his office in Sir Manasupe Haus to update him on his visit to the country, which is primarily to Newmont’s mining sites to “understand the operations better” in line with the company’s new plans for 2024 going forward.
Prime Minister Marape thanked Mr Palmer and assured him of his government’s commitment to work with the developer in all its projects covering Lihir and Wafi-Golpu.
The Prime Minister also commended Mr Palmer and Newmont for heeding several of his recommendations, including getting PNG to have its own operation in reference to Newmont’s worldwide business portfolio; and engaging in the conversation on IPO (Initial Public Offering) at the Port Moresby Stock Exchange to open up the stock market to Papua New Guineans.
The conversation also touched on temporary solutions for the current fuel shortage for the mines’ operations; corporate tax revenue from Lihir; and local ownership content in Lihir Mine come the next review of the mining contract in 2035.
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