Prime Minister Hon. James Marape today extended his gratitude towards Rio Tinto for its diligent efforts in conducting an effective legacy impact assessment for the Panguna mine and its affected communities.

The meeting saw the attendance of Rio Tinto PNG Country Director Andrew Cooper, along with Deputy Country Director Cornelius Soagai.

Prime Minister Marape praised Rio Tinto’s remarkable progress in the mining sector since its return to Papua New Guinea, marking over three decades since its operations ceased at Panguna mine through Bougainville Copper Ltd (BCL). “It is a step in the right direction,” he remarked.

During the meeting, Mr. Cooper updated on the Panguna Mine Legacy Impact Assessment’s progress, initiated by an agreement between Rio Tinto and representatives of the Bougainville community members through the Human Rights Law Centre. This process began following several months of dialogue facilitated by the Australian Organisation for Economic Cooperation and Development (OECD) National Contact Point (AusNCP). The assessment aims to identify and understand the environmental and human rights impacts since the mine’s closure in 1989.

“The Legacy Impact Assessment for Panguna is progressing well, with a final public report expected later in the year,” Mr. Cooper stated. Tetra Tech Coffey Ltd, a global consulting firm, has been tasked with completing Phase 1 of the independent assessment.

Prime Minister Marape reaffirmed his government’s commitment to securing greater benefits for PNG landowners from major resource projects, emphasising the importance of ensuring that the people of Bougainville receive fair resource benefits in line with their autonomy status. He assured full support for Rio Tinto’s efforts in the impact assessment, and the full transfer of BCL shares to the Bougainville Government and its people.

Additionally, Mr. Cooper briefed Prime Minister Marape on ongoing exploration activities by Rio Tinto in PNG, including in Manus.

The Mineral Resources Authority (MRA) on Friday March 22, 2024, played host to a delegation from the Department of Mines of the Southern African country of Botswana.

The MRA Managing Director Jerry Garry, welcomed the delegation and presented an overview of PNG's mining industry and the MRA and its functions.

The delegation comprised of the Director of Mines Ofentse Ditsele, the Principal Mining Surveyor Kabelo Ogaketse, the Principal Geo-Information Officer Pelonomi Matlotse, and Geologist Ndiwo Lesetedi.

The group visited MRA to see, learn and get information about our tenements management system, with the view of using the same system in their department. The delegation also visited the MRA's Mineral Production Data Hub and the core-shed.

Hon. Muguwa Dilu, MP, Minister for Mining, has given an update on the PNG's mining sector. On his recent public statement, he highlighted the priority sectors of the government. The minister stated that he is committed in supporting policy initiatives that benefit the interest of all parties involved.

"The extractive industry has always accounted for more than 80% of the total export revenue of PNG. It plays a significant role in supporting skills development, wage income tax, employment opportunities, and community project developments."

He mentioned that according to the 2019 PNG Extractive Industry Transparency Initiative (EITI) Report, there was a total of PGK 32 billion in contributions from the extractive industries that year. However, only 18.5% (PGK 6.14 billion kina) of that sum was received by PNG entities. Out of which, only 3.7% (PGK 1.2 billion kina) went to the National Government.

"In that year, mining alone contributed about 44% (PGK15 billion) of the total export revenues and the extractive industries collectively contributed 86% of the export volume out of the country. However, only 7% of that went to government revenue."

"This is a significant concern in line with the theme 'TAKE BACK PNG'. Are we being responsible to the people of Papua New Guinea in comparison to other jurisdictions throughout the world? Why is there a huge disproportionate return for the State against a huge volume of our resources being exported out of the country?"

Regarding mining regulatory framework developments, the minister enumerated two important changes that were made under the administration of Prime Minister Hon. James Marape.

The first one is the Mineral Data Repository Hub for the National Government. In 2020, the Department of Mineral Policy and Geohazards Management (DMPGM) made an amendment to the Mining Act 1992 which mandates all operating mines to submit live extraction and export data in real-time to a central hub at the Mineral Resources Authority (MRA).

The second one is the Alluvial Mining Policy, a policy change in 2021 that restricts and reserves alluvial mining activities for Papua New Guineans only.

He said, "A majority of our people are active participants in the alluvial mining sector. Therefore, this Government has reserved all alluvial mining activities for Papua New Guinean artisanal and small-scale miners only. This also extends to the buying and export of alluvial gold from PNG with the exception of existing foreign operators who are exempted by the State."

Additionally, the Minister noted three priority areas or key government priorities, namely: Porgera Gold Mine, Wafi Golpu Mining Project, and Frieda River Project.

"To advance the PNG mining industry, I have underscored the following key priorities as the new Mining Minister. This emphasizes the National Government’s commitment to these outstanding commitments."

For Porgera Gold Mine, the aim is to ensure the successful conclusion of the Porgera Compensation Agreement in order to facilitate the resumption of gold production at Porgera.

For Wafi Golpu Mining Project, they will work on the conclusion of the project negotiations and the permitting of the Wafi Golpu projects before the end of 2024.

Lastly, for Frieda River Project, the target is the advancing of the Frieda River project license application through to project negotiations with the State.

The Minister also mentioned additional priorities for this year in terms of legislative and policy priorities, namely the Mining Act 1992 review, the review of the Mining (Safety) Act 1977, Production Sharing Regime, Gold Bullion Bank, support for the Alluvial Mining Sector, New Policy Initiatives, and Geohazards Management.

On the Geohazards Management, Minister Dilu said, “Priority will be given to this area which performs a very vital function under the Ministry that undertakes 24/7 monitoring and assessment to safeguard and protect the lives of our people in areas prone to volcanic eruptions, earthquakes, tsunamis, and landslides.”

“Major priorities will be the relocation of the Rabaul Volcano Observatory, the replacement of obsolete monitoring equipment, and the conclusion of the Geohazards Management Policy.”

“The importance of collaboration among all stakeholders within the mining sector is vital in this industry. As the Minister responsible, I stand committed to supporting policy initiatives that benefit the interests of all parties involved.”

As an overview of PNG’s Mineral Production, over the last five years, the average annual metal production has been the following: Gold 2.4 million ounces; Copper 84,500 tons concentrate; Nickel 33,500 tons; Cobalt 3,000 tons; and Chromite 123,000 tons concentrate.

For an outlook on the minerals, PNG expects strong total annual copper production, averaging between 500,000 tons to a maximum of 700,000 tons per annum for a period of more than 30 years, after Wafi Golpu and Frieda River projects are commissioned as operating mines.

“These mega projects will take 5 to 7 years for construction and hopefully by 2030, these projects may become operating mines. Indeed, PNG will become a significant copper producer for critical minerals in the globe, possibly for over a period of three decades.”

He also reported that gold production from PNG declined from over 2 million ounces gold to about 1. 3 million ounces gold per annum since closure of the Porgera mine.

On the other hand, nickel and cobalt production outputs may increase to up to 90,000 and 9,000 tons per annum, respectively if Ramu MCC’s proposal to double its production output will push through and if the Mambare (Oro Nickel) is starts its production.

New Porgera Limited (NPL) would like to clarify certain matters related to the reopening of the Porgera gold mine that have been the subject of speculation and considerable misinformation both in the national media and on social media platforms over the past week.  

The benefit sharing terms agreed between the State, Barrick Niugini Limited (BNL), Kumul Mineral Holdings Limited (KMHL) and Mineral Resources Enga (MRE) to restart the mine ensure a transparent and fair distribution of the overall economic benefits that will be generated by Porgera over its 20-year mine life.  

Over the life of mine, PNG shareholders, comprising Porgera landowners, Enga province and the State (including KMHL which will hold the equity in new Porgera on behalf of the State), will receive 53% of Porgera’s overall economic benefits.  BNL will receive the remaining 47%.  

At a gold price of US$1,800 per ounce, PNG shareholders would expect to receive nearly US$7.3 billion (Kina ~25.2 billion) over a potential 20 year life and US$2.8 billion (Kina ~9.7 billion) in the first ten years.  The current gold price is significantly higher at approximately US$2,170 per ounce.

Importantly, BNL, the operator of New Porgera Limited, has committed to financing the capital required to restart the mine.  Furthermore, once the mine has restarted, any additional loans made by BNL or its affiliates to New Porgera Limited will be on an interest-free basis.  This means the State of Papua New Guinea will never face a situation where it would be necessary to take out interest-bearing commercial loans to fund its portion of the capital needed for investment in the mine.  

During the period between when the mine ceased operations in April 2020 until the reopening on 22 December 2023, BNL has alone funded 100% of the care and maintenance and preparatory restart costs totaling approximately US$677.6 million (Kina ~2.58 billion).  The State, KMHL and BNL agreed that initially KHML’s dividends from New Porgera Limited (as well as the dividends paid to the entity jointly owned by Barrick and Zijin that holds shares in NPL) will be used to reimburse BNL for the care and maintenance and restart costs (other than some agreed nonrecoverable costs).  However, the other PNG shareholders are not affected by this arrangement and will receive their dividends as they are declared following the start of operations.  

In addition, New Porgera Limited will be a significant taxpayer, being subject to a 32% corporate tax rate, in return for fiscal stability under the Resource Contracts Fiscal Stabilization Act, and an increase in the royalty from 2% to 3%. 

The proportion of equity and economic benefits that belong to the landowners is also a first in PNG’s agreements with international investors.  

Separately there have been reports in the media that New Porgera Limited has selectively engaged individual clan members in discussions on compensation agreements and bypassed the Porgera Landowners Association.  This is not true.  NPL has not selected the landholder representatives with whom it is dealing.  Rather, NPL is following the Government’s agency system that has been used for compensation payments since 1989, which has long been accepted by landholders.   

NPL is committed to progressing negotiation of the long-term compensation agreements with tenement landholder agents as soon as possible, and an NPL team is currently in Porgera and Tari on a second visit in as many months for this purpose.  NPL agreed to doing so under the interim Consent Compensation Agreements arrangements that were endorsed last year by the overwhelming majority of landholder agents and approved and registered by the Mineral Resources Authority to allow the mine to reopen.   

The members of the Porgera Landowners Association (PLOA) have been invited to participate in the discussions concerning the compensation agreement for SML13 and we look forward to their involvement in those discussions, as well as their participation in the State-led process to agree the Community Development Agreements (CDA).  NPL would like to see the benefits being distributed directly to the household level, and not through middlemen, to ensure the benefits actually reach the people for whom they are intended.

These facts have been shared to clarify some of the confusion created by inaccurate accounts of the terms of Porgera’s reopening and demonstrate beyond doubt that the benefits derived from this world-class mine will be shared fairly between PNG and its partner, BNL, and that NPL is engaging with landowners in a completely transparent and appropriate manner in accordance with PNG law.

Finally, the law and order situation in the Porgera Valley continues to be a major concern.  It is critically important that a safe and stable security environment is quickly restored and maintained for the benefit of the Porgera community and to support the continuation of the restart operations.  

Highlights

• Assays received for the final four metallurgical diamond drill holes of the 14-hole, 1,856-metre program completed in January (refer ASX release Simberi Resource Definition Drilling Update January 23, 2024) including:
  • SDH520: 28.6 m @ 1.4 g/t Au from 96.4 m;
  • SDH522: 60 m @ 2.6 g/t Au from 118m, including 4 m @ 10.3 g/t Au from 119 m, and 12 m @ 4.0 g/t Au from 140 m;
  • SDH527: 31 m @ 1.1 g/t Au from 0 m;
  • SDH528: 8 m @ 6.1 g/t Au from 0 m, including 2 m @ 13.4 g/t Au from 2 m.
• Sample material derived from the initial 10 holes has arrived in Canada for metallurgical testwork focused on three primary objectives:
  • Resolve assumptions for Sorowar ore competency which was previously classified as “medium” when all other ore types were classified as “extremely soft” which has a significant impact on the capacity of any grinding circuit design,
  • Determine whether lower flotation mass recovery can be achieved than indicated in previous testwork to better scale the flotation circuit without adversely impacting gold recovery, and
  • Test potential of ultra-fine grinding and leaching of concentrate to deliver a more capital efficient project design with attractive recovery outcomes.
• The second and final batch of sample material is now in transit from Simberi to Canada which provides the sample mass requirements and grade variability ranges for the full testwork program.

St Barbara Limited is pleased to announce that all assay results have been returned for the 14-hole, 1846-metre metallurgical diamond drill program at the Simberi Operations in Papua New Guinea (PNG). This has allowed the collection and dispatch of 2,434kg of sulphide ore for the planned comprehensive metallurgical testwork program in Canada.

Managing Director and CEO Andrew Strelein said “The receipt of remaining assay results for the metallurgical diamond drill program is another important milestone for the 2023/24 campaign. This has allowed the finalisation of the second batch of sample material now in transit to the selected laboratory in Canada.” Assay results for all 14 metallurgical diamond drill holes is set out below in Table 1.

Figure 1 below shows the location of the respective open pits on the main mining lease (ML 156) and Figure 2 shows the locations of the planned and completed diamond drill holes including both resource definition and metallurgical sample holes.

Mayur Resources Limited wishes to update shareholders regarding its announced partnership with PT SEA First Nickel Industry (PTSFNI) on 23 January 2024 concerning the Orokolo Bay Vanadium, Titanium, and Iron Sands project in Papua New Guinea (PNG).

PTSFNI has requested to put on hold its obligations to fund the development of the Orokolo Bay project, citing “sudden financial difficulties” related to the depressed state of the global nickel market and these prolonged conditions being forecast to continue.

PTSFNI wish to continue cooperation with the Company in respect of the Orokolo Bay project should it’s circumstances change. As a result, the Company has agreed with PTSFNI that Mayur has the right to transact with other development partners in relation to the Orokolo Bay project.

As previously announced, as part of the proposed strategic partnership, PTSFNI wished to additionally gain ownership exposure to Mayur’s flagship Central Lime Project (Phase 1), the Central Cement Project (Phase 2) and other Company assets by agreeing to acquire a 9.9% stake (Proposed Stake) in the parent Company being 21.99 cents per share representing a 15% premium to the then 30-day VWAP. Given Mayur's share price presently is trading at circa a 43% premium, the Company has agreed with PTSFNI that it no longer has the opportunity or right to acquire such Proposed Stake, nor would it be fair or reasonable to Mayur shareholders to do so.

Subject to PTSFNI's financial situation improving and the potential resumption of its paused projects, Mayur has the opportunity to re-engage with PTSFNI on similar terms previously announced in the absence of other development partners in respect of Orokolo Bay.

While the Orokolo Bay project is an attractive asset, and the Mayur Board is disappointed at these developments, Mayur purposely embarked upon a structure to bring in a 51% majority controlling strategic investor, as the asset is viewed as a non-core asset. Mayur’s focus is to become a carbon-neutral downstream processing lime and cement manufacturing business. Most of the Company’s focus is devoted to closing the conditions precedent and financing documentation to achieve Financial Close for its Phase 1 Flagship Quicklime development and finalise construction of the associated wharf as previously announced.

The seven landowning communities of the proposed Frieda River Copper-Gold Project have reaffirmed their commitment to work collaboratively with PanAust Limited at the first Community Leaders Forum for 2024.

The Community Leaders Forum is a regular pre-development meeting that provides an opportunity for Frieda River Limited to inform and consult with key stakeholders in the lead up to the final permitting of the Frieda River Project. The forum is an important part of Frieda River Limited’s engagement and consultation process.

Twenty-four representative community leaders met with Frieda River on 1-2 February 2024. The meeting provided an update to the leaders on the advancement of the permitting phase of the project and the Frieda River Hydroelectric Project. The sessions were extended to openly discuss and resolve community concerns and answer questions on the technical and engineering aspects of this project of national significance.

The meeting concluded with a review of the Frieda River Accord. Signed in 2018, the Frieda River Accord calls for a PanAust and community shared vision and values of working cooperatively and resolving any differences of opinion and expectations while mutually advancing the Frieda River Project.

Prime Minister Hon James Marape, recently witnessed the first gold pour of the New Porgera Mine, since the expiry of the then Special Mining Lease (SML1) in 2019.

The event signifies that it will be 'all systems go' come July when full operations are expected to commence.

The PM was on-site accompanied by the Governor for Enga Province Hon Sir Peter Ipatas, Mining Minister Hon Muguwa Dilu, Member for Laiagap Hon Amos Akem, Country Manager for Barrick Niugini Limited Karo Lelai, Managing Director of the Mineral Resources Authority (MRA) Jerry Garry, and Managing Director of Kumul Minerals Holdings Limited (KMHL) Sarimu Kanu.

PM Marape said this was an historical event that marked the beginning of a brighter future for the country, especially landowners and stakeholders. He said when his government got into office in 2019, it embarked on a mission under the banner 'Take Back PNG' to ensure that the country must get a fair-share of benefits from all its natural resources including benefits from mineral resources. However, he said his government was also mindful and respectful of the fact that investors’ must also make their return on investments so that it is a win-win for all parties.

MRA MD Mr Garry said he was happy that the project had come this far. He said it had been a huge challenge for the MRA, in terms of ensuring that the application for SML13 by New Porgera Limited ( NPL) in 2023, met all regulatory requirements and were compliant with laws.

He said another challenge had been to effectively manage landowners' and stakeholders' expectations.

“As far as the MRA is concerned, all regulatory requirements under the Mining Act 1992, have been fully satisfied,” said Mr Garry.

He said the regulatory process begun from the time, the operator New Porgera Mine Limited (NPL) applied for the SML13, followed by the conducting of Wardens Hearing, the technical assessments, the Mining Advisory Council (MAC) deliberations and recommendations for grant to the Mining Minister.

The MD said the Community Development Agreement (CDA) process had almost been completed, and that stakeholders were now preparing to go into CDA negotiations proper.

• Production in 2024 is expected to be 120,000 to 140,000 ounces gold equivalent (“AuEq”). The second half of the year is expected to be the strongest, as operations progressively ramp up ahead of the new 1.2 million tonnes per annum (“mtpa”) Stage 3 Process Plant commissioning, scheduled for the end of Q1 2025.
• Cash costs between $820-$880 per ounce gold and all-in sustaining costs (“AISC”) of $1,440-$1,540 per ounce gold forecasted for 2024. The moderate increase from 2023 guidance for cash costs and AISC is driven by increased accelerated operating and capital development for the Stage 3 and 4 Expansions in addition to development and equipment that was planned for 2023 being completed/delivered in 2024. As outlined in the Integrated Development Plan (1) (“IDP”), we expect a very significant reduction in cash costs and AISC in 2025 and beyond upon commissioning of the Stage 3 Expansion.
• Large exploration program planned, with $17-$20 million projected for 2024. Surface exploration to focus on Arakompa, Kora South, Judd South and the A1 porphyry, with underground drilling focusing on Kora, Kora South, Kora Deeps, Judd, Judd South, Judd Deeps and Northern Deeps targets.
• Growth capital forecasted to be $145-$160 million in 2024 and $40-$50 million in 2025. Total growth capital for the Stage 3 and 4 Expansions (including the amount spent to date) is now forecasted at $210 million, a 12% increase from the Stage 4 PEA case of $187 million, as outlined in the IDP ( 1) . The moderate increase in capital costs from the IDP is driven by global cost inflation over the past 2 years since the date of the study (IDP effective date is January 1, 2022) and minor scope changes. As at December 31, 2023, 48% of the Stage 3 and 4 Expansion growth capital has been either spent or committed, and importantly the largest package, the Stage 3 Process Plant, has been awarded on a lump-sum fixed price basis to GR Engineering Services Limited, significantly de-risking the project ( see July 24, 2023 press release ). The remaining major package to award is the Paste Fill Plant, with plans to award long lead contracts in the coming weeks.

Note: All amounts in United States Dollars unless otherwise indicated.
(1): Refer to Integrated Development Plan (IDP) Definitive Feasibility Study (“DFS”) Case and PEA Case. IDP effective date is January 1, 2022. IDP has not been updated to reflect the updated Kora and Judd resource estimates (effective date September 12, 2023); however, the Company does not expect the design parameters and conclusions to materially change. The Company expects the potential mine life to be extended for both the DFS and PEA cases.

John Lewins, K92 Chief Executive Officer and Director, stated, “We are very excited about the outlook for the Company this year and in particular over the next 18 months, as K92 transforms into a Tier 1 Mid-Tier Producer with the delivery of the Stage 3 Expansion while also having the potential to deliver very significant exploration results from multiple targets as we saw earlier this week with the first two holes reported from our maiden drill program at Arakompa.

Operationally, in 2024, our focus is on increasing production from last year, while progressing with various infrastructure projects on surface and underground for the Stage 3 and 4 Expansions. The various growth capital packages, led by our Vice President Projects and Engineering, Chris Kinver, have made significant progress with 48% of the total growth capital either spent or committed as at December 31, 2023. Chris Kinver’s team is also well advanced awarding contracts for our second largest package, the Paste Fill Plant, with the tender process underway for long lead time items, which are expected to be awarded in the coming weeks.

On the underground mine, we are making significant investments in sustaining capital ahead of the Stage 3 Process Plant commissioning to establish multiple mining fronts while also introducing infrastructure that we expect will deliver a step-change in productivity. In 2023, Kainantu effectively operated with one mining front, and by the end of 2024, we plan to have three fronts producing, with a fourth planned for 2025. Infrastructure, such as the twin incline, ore and waste passes, in addition to ventilation upgrades are expected to significantly improve efficiencies and material movement capacity. This is also expected to realize very significant economies of scale.

And lastly, we continue to see significant value creation potential from exploration, maintaining near-record expenditures through 2024 while we progress the Stage 3 and 4 Expansions. We look forward to providing updates in due course.”

Freeport Resources Inc. is pleased to announce that further to the Company’s news release of December 11, 2023, Papua New Guinea’s outgoing Minister for Mining, the Honourable Sir Ano Pala, approved the renewal of the Yandera Copper Project’s Exploration License 1335 (“EL”) through November 19, 2025, in accordance with the regulatory processes prescribed by the Papua New Guinea (“PNG”) Mining Act.

“We are pleased to have successfully completed the exploration license renewal process for another two year renewal period, and would like to thank the Mining Advisory Council and the Government of PNG for their dedication in advancing large-scale resource projects such as Yandera Copper,” commented Dr. Nathan Chutas, Senior Vice-President of Operations for Freeport Resources. “These Exploration Licenses are typically issued many months or more in arrears so this renewal of Yandera Copper Project’s Exploration License clearly demonstrates the increasing commitment of the Government of PNG to building strong, working relationships with international mineral exploration and development companies such as Freeport Resources. We would also like to congratulate PNG’s newly appointed Mining Minister, the Honourable Muguwa Dilu, who was sworn in to his new position on January 18th, 2024,” said Dr. Chutas, who continued, “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’s largest undeveloped copper resources.* With the extension of the exploration license to November 2025, we are excited to finally have the visibility going forward that we have lacked since Freeport took over the project. We can now commence to plan work programs on the Definitive Feasibility Study and continue discussions with potential strategic partners for development of the mine.”

Appointment to Mining Advisory Council of PNG

Freeport Resources would also like to announce that Tobias Kulang Thomas, a member of the Company’s Advisory Board, has been appointed to the Mining Advisory Council of PNG. The Mining Advisory Council is an independent committee established under PNG’s Mining Act comprised of representatives of the Mining Resources Authority, PNG’s governing regulatory body, and senior representatives of the mining industry. The Mining Advisory Council reviews and deliberates on the Exploration License and Special Mining Lease application processes and makes final recommendations to the Minister for Mining. Tobias Kulang Thomas was nominated as a member of the Mining Advisory Council by the Honourable Muguwa Dilu, PNG’s new Minister for Mining.

Yandera – Strategic Review

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 Preliminary Feasibility Study titled, Independent Technical Report on the Yandera Project - Pre-Feasibility 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.

Freeport Resources has initiated a 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.

* 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, Freeport Resources has begun discussions with key international strategic investors and prospective partners for development of the Yandera Copper Project. Demand for copper is forecast to undergo 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 below).

Copper Supply and Demand Imbalance Forecast

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 Resources is also planning a wider exploration program of porphyry copper targets within the largely underexplored 245.5 square kilometer land package.

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 4 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.

President of the Autonomous Region of Bougainville, Hon. Ishmael Toroama, met yesterday with over 300 participants of the Panguna Mine Land Owners Clan Chiefs, at Tunuru Catholic Mission outside of Arawa Town, Central Bougainville.

The purpose of this important meeting was for President Toroama to inform the landowners of the Government’s recent decision on the granting of the Exploration Licence EL01 over the Panguna former Special Mining Lease (SML) area to Bougainville Copper Ltd (BCL).

President Toroama in his address described the meeting as a historical one following the numerous meetings facilitated over the past two years through the Panguna Mine Dialogue process.

He said that the dialogue process created a ‘constructive space’ that provided both the landowners and the Government to come together despite the existing differences, and talk openly and honestly about Panguna, which culminated in the shared resolution to re-open the Panguna Mine.

“The Panguna Mine Dialogue clearly demonstrated a breakthrough in bringing together the landowners to talk with the ABG, and the biggest accomplishment was the resolution we reached together to re-open Panguna Mine,” he said.

President Toroama highlighted a key resolution that was made during the Panguna Mine Dialogue Chief Summit of February 2022, where both parties agreed that, ‘the ABG needs to develop the best strategy forward under a local entity, jointly owned by landowners and the ABG, on behalf of the people of Bougainville.

It was in this same spirit, that the ABG, as the mandated government, had come forward with this strategy to begin the project cycle through the granting of EL01.

“As the President and the Minister for Minerals and Energy, I am here today to let you know that I have granted the EL01 over the Panguna special mining lease area to BCL,” Toroama said.

The President’s announcement to the landowners was received with great support. Despite a petition to the Government over its decision earlier in the meeting, following dialogue among the clan groups, the landowners reaffirmed their full support for the Government's decision, standing in solidarity with President Toroama and his administration throughout this process.

President Toroama also acknowledged that the announcement of the granting of the exploration licence to BCL was not an easy thing to hear, however he assured the Panguna Landowners that the granting of the licence was a well-informed decision done within the strict framework of the legal process.

He emphasized that Bougainville’s political agenda hinges on economic progress, and the issuance of EL01 presents an opportunity to address the prevailing economic challenges and propel Bougainville's economic advancement in accordance with our political timeline.

“We are creating opportunities for our generations to come,” he said.

President Toroama committed to having continued consultations and dialogue with the landowner groups and key stakeholders, through the ABG Department of Mineral and Energy Resources, at every stage of the process.

In an effort to enhance accessibility for these consultations between the Government, landowners and other stakeholders, the President announced that the ABG Department of Mineral and Energy Resources will be setting up office in Arawa Town.

Bougainville Copper Limited (BOC) has confirm that the Autonomous Bougainville Government (ABG) has taken a decision to award a five-year extension of the Company’s EL01 exploration licence for the Panguna project in Central Bougainville.

At a ceremony in Buka recently, to mark the granting of the extension, Bougainville President Ishmael Toroama said Panguna was a “high impact project for Bougainville” and that issuance of the licence would pave way for redevelopment. This will commence with advanced stage pre-feasibility and feasibility stage exploration activities over the coming years.

Panguna is one of the world’s largest known copper deposits and BCL Chairman Sir Melchior Togolo said the Company was excited at the prospect of leading the redevelopment work.

“This is a result of constructive collaboration, underpinned by mutual respect, with a common goal to make Bougainville economically strong, create opportunities for business development and for employment of our people,” he said.

“The ABG, Landowners and Bougainville Copper have been working on resolving differences since the refusal of EL01 extension in January 2018. Today marks the successful culmination of these joint efforts. Panguna promises to be a transformative investment for Bougainville that will support greater levels of economic self-reliance for the region,” Sir Melchior added.

The ELO1 extension clears the way for BCL to increase its activities in the Panguna project area in accordance with the Bougainville Mining Act 2015. “The Company has a well-established presence in Bougainville and has forged strong community relations. This provides a very solid foundation for increased activity as we work with mutual respect towards Panguna’s redevelopment,” Sir Melchior said.

Prime Minister and Treasurer Hon. James Marape has welcomed the positive update from New Porgera Ltd (NPL) regarding the Porgera mine’s reopening. He conveyed his satisfaction with the announcement that the restart of Porgera is well underway and on schedule, with the first gold production expected in the first quarter of 2024.

Expressing his appreciation for the concerted efforts of all parties involved, Prime Minister Marape stated,

“I want to assure Papua New Guinea that Porgera mine is fully operational now, with first gold production underway.

“This announcement by NPL not only signifies a pivotal phase in the Porgera mine’s reopening but also underscores the government’s resolve to ensure fair and substantial returns from natural resources for all stakeholders involved.”

He also commended Barrick Niugini Ltd for its exemplary leadership in reinstating the operational status of the mine, adding, “The mine being operational once more is testament to the negotiations between a world super major, Barrick Gold Corporation, and the National Government under the theme of ‘Taking Back More from Our Natural Resources’.”

Prime Minister Marape reflected on the past arrangement of the Special Mining Lease (SML) 1, retired in 2020, where Papua New Guinea held a minimal stake.

He detailed the enhanced terms of the new agreement, stating, “Today, under the new arrangement, landowners and the Enga Provincial Government will have 15 per cent equity, 3 per cent royalities, and there will be no tax holidays by the mine.”

He emphasised the improved distribution of the project’s benefits, with Papua New Guinea receiving 53 per cent and investor partners 47 per cent.

Highlighting the financial implications of the project, Prime Minister Marape noted the valuation of NPL and the potential for the State’s share to be repaid within a promising timeframe, due to favorable market conditions.

He underscored the strategy for financial contribution and recovery, explaining, “The State, through Kumul Minerals Holdings Ltd, contributed no cash for equity and will repay through earnings from its share.”

Prime Minister Marape reassured landowners of the government’s dedication to inclusive and constructive dialogue, as demonstrated by the planned Landowners Consultative Forum in Wabag.

He emphasised the commitment to addressing stakeholder concerns and equitable benefit distribution, stating, “All position papers that have been received will be packaged and we will come and meet the landowners – either in late February or early March – and we will start negotiations on the split in total benefits for all stakeholders.”

Mining Minister Honourable Muguwa Dilu, recently said delivering Porgera and Wafi Golpu projects, and progressing Freda River were amongst the government’s key priorities under his leadership.

The Minister outlined his priorities during the hand-over-take-over ceremony of the Mining Ministry between him and his predecessor Hon Sir Ano Pala.

He said other priorities were:

1. To explore more opportunities for downstream processing of the country’s mineral resources, such as the recent agreement between the Kumul Mineral Holdings Limited (KMHL) and Ramu Nickel Mine.
2. Ensure review of the mining act 1992 is progressed.
3. Ensure that the consent compensation agreement for Porgera is successfully concluded so that production could commence.
4. Look into production sharing regime
5. Look into the prospect of establishing a gold bullion bank that will address the country’s issues with foreign exchange.
6. Develop mine closure policy.
7. Develop policies to support and improve the alluvial mining sector.

He said the mining sector was an important sector to the government as it contributes 70% the total Gross Domestic Product (GDP) of the country annually, brings in foreign exchange, creates job opportunities for citizens and brings benefits for project landowners.

Hon Dilu said it was critical that all stakeholders of the mining sector worked together for everyone’s interest and benefit. He said as the Mining Minister he would support policies that benefit all stakeholders.