SHARON E BARNABAS
OK Tedi Mining Ltd’s (OTML) unique company structure provides benefits for the country unlike those from any other companies, managing director Alan Breen has claimed.
These benefits are through taxes, royalties, dividends, infrastructure projects, community projects, compensation and employment, he said.
Canadian company Inmet owns 18% stake in OTML, while the State has 30%. The Papua New Guinea Sustainable Development Program (PNGSDP) owns the majority interest of 52%.
This makes 82% of the cashflow generated by the company set aside for nation building capacity.
Mr Breen said: “Since the first gold pour in 1984, the company has delivered more than K13 billion in benefits.”
Company structure change was a result of BHP’s exit and the finalisation of the ninth supplemental agreement in 2001.
“Since then, almost K6 billion has been paid to shareholders in dividends due to a strong commodities market,” Mr Breen said.
During the same period, the State has received more than K5 billion in tax revenues and a further K500 million in royalties.
Based on these facts, Mr Breen said it would be more appropriate to ask the question to the recipients of these substantial benefits.
He said: “Much of this money is tied up in trusts and banks rather than being used to develop the services and infrastructure the province and the nation desperately needs.”
Mr Breen cited Sir Arnold Amet’s question on where all the wealth from the mineral boom goes to, and said it concerned him most “as benefits are not seen on the ground where it matters most”.
Sir Arnold raised the question in response to Mineral Resource Authority boss Kepas Wali’s presentation on Mining Benefits and responsible equitable distribution during the annual mining and petroleum seminar in Port Moresby last week.
Mr Breen said despite these massive accumulated benefits, the deterioration of health, education and infrastructure services in the Western Province has continued.
“It is not that funding is not available but that substantial funds are sitting unused in trust accounts and banks,” he stressed.