OTML posts K5.1b revenue

By YEHIURA HRIEHWAZI
OK Tedi Mining Ltd, which is now a 100% PNG-owned company, earned K5.1 billion in sales revenue last year alone – 27% higher than in 2009 and highest ever recorded in any one year.
And a whooping K3.2 billion of that was ploughed back into the PNG economy as direct financial benefits in the form of taxes, dividends, royalties, compensation payments and for goods and services supplied to the mine.
It declared an after-tax net profit K2.03 billion last year  – the highest since the mine opened.
The unusually high export earnings were due to high metal prices of copper, gold and silver.
Net cash generated before dividends was up 96% to K1.98 billion from K1 billion, which was almost double the previous year’s net takings.
Total dividends paid to the State and PNG Sustainable Development Program Ltd and Inmet Mining of Canada was K1.687 billion. K300 million of that went to Inmet.
The state, through its 36.6% equi­ty received K507 million and PNGSDP, received K879.65 million.
Inmet sold its shares back to OTML last January and exited from the mine.
According to an information sheet distributed to the media by OTML during a workshop on mining and petroleum over the weekend, the financial benefits were distributed as follows:
Various forms of taxes to government – K920 million; dividends – K1.687 million;  royalties to Fly River provincial government and landowners – K46.8 million; compensation payments to impacted communities – K69 million; goods and services sourced from within PNG – K816 million.
All added up to a total of K3,238.8 million.
A total of K1.48 billion was cash payment to government.
The government used that to hand down a supplementary budget and appropriated K600 million to free education next year.
“When you have free education next year, thank Ok Tedi,” Brian Gomez, facilitator of the media workshop over the weekend, said.
In the third quarter of this year, OTML produced 37,767 tonnes of copper, 105,533 ounces of gold which are lower by 15% and 23% respectively compared to the corresponding period in 2010.
This was attributed to lower copper and gold head grades which were lower by 6% and 17% respectively, due to a requirement to process low sulphur ore as a result of the ruptures on the pipeline carrying pyrite waste.  
Meanwhile, OTML’s general manager (community business support and corporate relations) Musje Werror told the media workshop that mine life extension was pending on completion of the feasibility study, OTML board approval, community consent and State regulatory approvals.
This will facilitate OTML continuing its Mt Fubilan mining activities until 2022