No deal yet

Main Stories

ENERGY Minister Sam Basil, who will now look after two important State-owned companies, says landowners’ welfare will be paramount during the K17 billion Wafi-Golpu mining project talks.
He will look after Kumul Mining Holdings Limited and Kumul Petroleum Holdings Limited on top of the Energy, Communications and Information Technology portfolios.
Prime Minister Peter O’Neill mentioned this during the signing of a memorandum of understanding on Tuesday between the Government and the developers of the Wafi-Golpu project in Morobe — Australia’s Newcrest and South Africa’s Harmony Gold.
Basil, picured, who attended the event, said the memorandum was merely “to affirm the parties’ intent to proceed with the Wafi Golpu project”.
He clarified that no legally-binding document on the project had been signed yet as negotiations were still ongoing.
“I represent Bulolo as MP and the Wafi-Golpu project is in Bulolo district,” he said.
“I cannot be a party to anything that does not consider the welfare of Wafi-Golpu project landowners, Bulolo district, and for that matter, Morobe.
“The legally-binding documents, which are yet to be signed, are the Wafi Golpu Memorandum of Agreement and the Mining Development Contract.”
Basil said the memorandum was subject to the permitting process governed by the State, plus the mining laws and regulations, “as well as approvals by Newcrest and Harmony boards”.
“All must understand that not only have investors spent a lot of money on exploration, but also that when an ore body is found, they also expend huge sums of money in preparations, while at the same time trying to comply with the often lengthy legally binding permitting process to develop and operate mines.
“All developers need some form of assurance and commitment from the Government so that they do not spend money in vain without any guarantees.”
The memorandum of understanding with Newcrest and Harmony:

  • Establishes the framework to progress the permitting of the project in accordance with the applicable regulatory processes;
  • provides key terms to be used in the mining development contract and other legally binding documents before they are negotiated;
  • provides stability for long-term investments required to develop and operate the proposed project;
  • affirms the intent of the parties to complete the permitting process and achieve grant of a Special Mining Lease by 30 June 2019; and,
  • Gives the project developer confidence to “start spending on their substantial initial work programme”.

“The MoU does not pre-emptively record key issues like equity, royalty, mining township, human resourcing and spinoff benefits, etc which are still under negotiations,” Basil
“These issues will be contained in the MoA and in the Mining Development Contract which are still under negotiation in the permitting process, including through the mining development forums.
“Once the MoA and MDC are signed, then the Special Mining Lease will be granted, signalling approval for development of the mine and its operation.”
He said everything was expected to be completed by June 30, 2019.

Leave a Reply