SHARON E BARNABAS
THE extension of Ok Tedi mine life presents a genuine opportunity for the State and for the country, but the window for an extension is fast closing, managing director Alan Breen said.
The project is significant and there is a big prize – jobs, higher level of economic activities in Western province, K3 billion in Government revenues and K2 billion in PNG Sustainable Development Program (PNGSDP) dividends.
“The project can only proceed if there are no material changes in the environmental impacts and … this part of the study will be crucial to the decision,” Mr Breen said.
“Any delay in the project will introduce a production gap that will significantly devalue the project in terms of economics and efficiencies.
“If the mine life extension does not take place and the mine closure process is followed through … then the last remaining ore in the Mt Fubilan pit will … be lost forever as it is unlikely any future capital investment would be justified.”
Mr Breen said: “Whilst ambitious, the project schedule is achievable if all parties proactively support and engage in the parallel processes.
“Thus far this has been easier said than done and a mine life extension is at considerable risk.
“The LNG project is all the rage and appears to be the primary focus of the attention for Government,” Mr Breen said.
“While LNG project will surely benefit PNG … and the mine life extension at Ok Tedi may not be quite in the same league as LNG, the decision about Ok Tedi mine is as important for the country as LNG and requires the same level of scrutiny,” Mr Breen said.
He said, based on data cited, Ok Tedi mine life extension would employ more than double the PNG nationals than would the LNG project.
He also said OTML’s unique shareholder structure, the combined additional benefit to the country through State revenues and PNGSDP dividends were more than half of that derived from LNG.
OTML also carries significant value in terms of its assets, its people and it’s in country experience which will be destroyed when the mine closes.
Mr Breen said: “Rather than lose the value and goodwill OTML has, it would make much more sense to try to leverage off OTML’s position and experience to help other PNG projects off the ground.”