Porgera’s new lease

The National Main Stories

A SPECIAL mining lease for the Porgera gold mine will be issued to a state-owned enterprise, but the Government is giving the operator the option of negotiating “how it can remain”.
Prime Minister James Marape in a statement yesterday explained why the mining lease renewal sought by Barrick Niugini Limited (BNL) had been rejected, and why a special mining lease would now be issued to the Kumul Mineral Holdings Limited (KMHL).
The operator BNL is challenging in court the non-renewal of the special mining lease it applied for on June 29, 2017.
Marape said BNL’s lease expired on Aug 16, 2019, and on the recommendation of the Mining Advisory Council, it was not renewed.
The BNL and the KMHL then applied to the Mineral Resources Authority (MRA) for a new special mining lease.
“(The MRA) decision was in favour of KMHL,” Marape said.
He said BNL “has all rights to contest our process in court and it is in all parties’ interest to conclude the matter fast”.
“But if Barrick feels they want to be still at Porgera, then it is now up to them to meet KMHL to discuss how they could remain in Porgera under KMHL’s special mining lease,” Marape said.
“(The) equity plus operatorship option is on the table subject to negotiations.
“My government’s policies to empower our citizens and our country takes precedence when opportunities (arise) and with the expiring of lease and through the failure of lease renewal by a legitimate process, we had no option but to progress in the manner we have done as far as Porgera is concern.”
He assured the landowners and the Enga government that they will benefit from the new arrangement.
Opposition Leader Belden Namah called the Government’s move “devious, ill-advised, ill-timed and a fatal blow to investor confidence”.
Former Prime Minister Peter O’Neill said the decision would further destroy the country.
“This government must be stopped from making more damage to the nation.
“We have no capacity or funding for this madness,” O’Neill said.
Mining Minister Johnson Tuke said he could not comment on the matter.
Namah said to issue a special mining lease while BNL was challenging the matter in court meant that the refusal to extend the lease was “devious and ill-intentioned.”
He warned that this decision “now pre-empts the matter in court and might be held to be sub¬ judicial to the whole case”.
He said if KMHL was the State’s choice to develop Porgera, then who would be the operator?
“Instead of resolving the issue with BNL over the granting of a new special mining lease, the Government has granted a new one to KMHL,” he said.
“By this ill-advised and ill-timed decision, the hope of an early reopening of Porgera mine has now faded.”

17 comments

  • There are processes in place for applying and getting the SML license. I have seen Barrick Nuigini Ltd done that, for example, Mine Warden hearing at Porgera. I have not witnessed any of such done by KPHL. The country will be losing billions if Barrick take this to Court.

  • BNL stands to loose more with the non-renewal of the SML by the government because they own the majority equity. They recently revised their 2020 revenue projections downward to reflect losses from the closure of Pogera. For as long as the current virus pandemic drags on the gold prices will always be high as governments around the world continue to demand gold to back up the paper money that their central banks are printing to prop up their struggling economies. Prime Minister JM is on record for saying that “it’s not the end of the world” and “we are not going to die”, if Pogera mine closes and urged everyone to develop their land and engage in agricultural activities to grow our economy and sustain our livelihood.

  • when country was flying with abundant resources, no one came up with the idea to control and conserve natural resources for the benefit of the current population and the future. only few benefited through corrupt means (nationally and internationally) while majority of rural folks suffered silently up to now from the national income generated through imports of such resources(like gold), since independence. PNG once being a fat cow is now milked to a stage where it would become malnourished and soon die unless rescued. lack of prudent resource management is the issue and PMJM has taken the right step..time to concentrate on renewable resources than concentrating on non-renewable resources. strengthen agriculture, tourism, fisheries, forestry, intellectuals, lateral and bi-lateral relationships, industrial innovation(downstream processing) for improved export and reduced import for national fiscal pool stability and growth, etc,etc. people must accept the sacrifice we must offer by facing the economic woes for the good of tomorrow (we bear as majority rural and disadvantaged folks thjat i no rong bilong mipla tasol mipla kisim taim nating ). PMJM keep doing what you do but I warn, people who wanna steal from the greener pastures through your economic recoveries are happily waiting at the other end of your journey. So people of PNG let PMJM still be jthe PM in the next election so that he can measure his output of his current input..

    good luck PNG

    • I can not see any reason why PMJM should remain as PM after the next election. Please don’t insult our intelligence by giving all kinds of excuses and justification for PM’s failure, inconsiderate and wreckless governing of the nation.

  • Like every other state-owned enterprises, it will be a failure.
    We can not learn from history.

  • What are the reasons why the so called mine advisory council refused BNL mining lease. This PM n his mining minister are the worst combination in the short history of PNG. They will single handedly destroy PNG. PO was the right choice by the people, of the people and for the people. People of PNG mandated PO to lead PNG. PMJM hijacked

  • Reopening of Pogera mine will be after some 10 years time while going through the court process.No miracle will take place as long as BNL is existing.

  • Reopening of Pogera mine will be after some 10 years while court battle is in progressing.No miracle will take place as long as BNL is still around.

  • This is one good thing you did right for PNG PMJM. This is a good example of taking PNG back.

  • Good move ,PM JM. Few educated fools and some power hungering politicians can make all sorts of negative comments to serve the interests of foreigners, but bear in mind that the majority of the population of this nation are rallying behind you with prayers to support your good move to take back whats belong to the people PNG from the hands of few corrupt leaders and foreigners. God bless you and your leadership; long live Mr Marape, powerful leader in the history of this God blessed beautiful country.

  • Porgera mine will be mothballed just like Panguna mine, until the legal issues are ironed out. Barrick Niugini Ltd has all the monetary resources to sue the State, and can prolong the legal case until PNG runs out of money. PNG on the other hand, has the natural resources but is living on borrowed money. How and where will Kumul Mineral Holdings get it’s finance from to operate this mine? It will go to the international financial markets to borrow with the risks fully guaranteed by the State. We the ordinary people will suffer the short term pains for the long term gains, ha??

  • Good call PMJM. That’s the best decision this country has ever had. Poachers & exploiters must leave. Partners are what we need right now.

    Short sighted & people with lack of understanding can’t see the vision of this decision. Every operator must know that people live in this country & there are Landowners whose land is destroyed to get the minerals.

    PNG lost big time for many years to the greed of only the few Pngeans who benefited. Those are the ones making the negative comments.

    Live in real life. The decision is made & a very good one.

  • I don’t see any thing wrong with the change? Have you know anything about sub contract?..fools

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