OTL records best earning

By FRANK ASAELI
OK Tedi Mining Ltd has announced that PNG shareholders and the PNG Government will receive more than K2 billion in dividends and taxes following a record performance at the copper-gold mine last year.
In its annual results for the year, OTML said record prices for copper and gold sent revenues for the year to a record high of K5.04 billion with after tax profit hitting more than K2 billion for the first time ever.
It said that after tax profit had risen to a record US$293.7 million or K826 million, up from US$265.3 million in 2006.
Total dividends paid fell from K1.8 billion in 2006 to K1.44 billion last year which included K1.2 billion for PNG interests.
The largest equity owner is PNG Sustainable Development Program Ltd, which has a 52% stake in Ok Tedi, with 30% held by the PNG Government, Western Province and local landowners. The remaining 18% is held by the Canadian mining firm, Inmet.
The total taxes paid could cause another windfall for the Government and also for its next supplementary budget.
OTML’s total gold production of 15.5 tonnes was 9% below 2006 production, keeping the company within the top three PNG gold producers.
The company also realised an average copper price for the period of US$3.35 (K8.9) per pound compared to US$3.24 (K8.6) for 2006.
Net cash generated before dividends, was down more than 50% on the previous year due to the combined effect of higher spending on capital projects, timing issues on the payment of income tax relating to other years and a large increase in working capital.
Mining royalties were 11% lower than 2006 with the Fly River provincial government and landowners each receiving K45 million.
The company also paid K58 million as other compensation and benefits during the year including land lease payments, trusts and community mine continuation agreements.
Goods and services provided to OTML from PNG sources was worth K408 million.
Meanwhile, the mine waste and tailings project to remove pyrite from mine tailings, thus reducing future impacts on the river system, was approved by Government, and is currently under construction.
Commissioning of the plant is due to commence in July this year.