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PNG Govt confident it can operate Porgera gold mine



The Papua New Guinea Government is confident it has the financial and technical capacity to operate the multi-billion kina gold mine in Porgera, saying its own successful OK Tedi mine is proof enough. 


Prime Minister James Marape, who this week defended the move to issue a special mining lease on Porgera to its own company Kumul Mineral Holdings Limited (KMHL) instead of the operator Barrick Niugini Limited (BNL), said the Government had the capacity to buy the assets and operate the mine successfully. 


“Yes, we are a Government. We are (already) running Ok Tedi. We own Ok Tedi,” Marape said. He, however, kept the door open for BNL saying it should, if it wants to continue operating the gold mine, discuss the matter with the KMHL. 


He also said BNL “has all the rights to contest our process in court”. 


Marape stressed that “the equity plus operatorship option is on the table subject to negotiations”. 


BNL in a statement said it was aware of the Government move on the special mining lease. 


“BNL considers that any such grant of the special mining lease (to KMHL) is unlawful and invalid,” the miner said. Former Prime Minister Peter O’Neill said Marape’s decision would further destroy the country. 


“We have no capacity or funding for this madness,” he said. 


Opposition Leader Belden Namah said Marape had “unnecessarily increased and prolonged economic hardships for PNG” with the decision. 


“Has the Government considered what happens to Barrick Niugini Ltd’s assets worth billions of kina, its legacy issues pertaining to the environment, outstanding taxes, it's nearly 3,000 employees and contractors and sub-contractors?” Namah said. 


He said the Government should have resolved the issue with BNL before granting a new special mining lease.


“By this ill-advised and ill-timed decision, the hope of an early reopening of Porgera mine has now clearly faded. 


How long can the economy sustain Marape’s short-term pain and how soon can we expect his long-term gain?”


Namah said it was a “fatal blow to investor confidence which had been at an all-time low since Marape came into power”. 


“Companies invest billions of Kina in the country after weighing sovereign risk, political stability and a predictable, open and transparent legal, policy and fiscal environment,” Namah said.


Source: https://news.pngfacts.com/2020/09/png-govt-confident-it-can-operate.html

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