Recession elevates gold: Sir J
THE demand for gold mostly rise when the economy worsens, New Ireland governor Sir Julius Chan says.
Sir Julius said this was happening right now.
He made the statement during a meeting with Kumul Petroleum Holdings Limited (KPHL) board in the province recently.
“The demand for gold almost always rises as the economy worsens. And that is just what is happening today,” Sir Julius said.
“In less than two years, gold has gone from US$1,200 (K4,197) per ounce to nearly US$2,000 (K6,995) per ounce – an increase of nearly 70 per cent in two years.
“The outlook is that the price will continue to rise at a moderate but steady rate.
“That means the returns from gold – unlike returns from oil, LNG or copper – will be much higher over the next year than in the past year. Returns from gold in PNG will increase by about 40 per cent over the next year.
“The revenues from gold will likely go from about K10.5 billion last year to around K15 billion next year – an increase of K4.5bil in one year, I believe these windfall profits should benefit the people, not just the companies.”
The KPHL which held its board meeting outside of Port Moresby, paid a courtesy visit to Sir Julius and executives of the New Ireland administration last Wednesday.
The meeting was held at the newly-opened New Ireland legislative building, making the board the first official guests invited to meet in the new provincial executive council conference room.
KPHL board chairman Dr Benedict Yaru, managing director Wapu Sonk and directors Dr Ila Temu and Peterson Pipi were among other officers at the meeting.
They spoke about the proposed amendments to the Oil and Gas Act which is expected to have a reading in the next Parliament sitting.
Sir Julius said New Ireland was focused on the mining sector and was always looking for ways to refine greater benefit sharing and improving royalty levels for the landowners, provincial government and the national government.
Other topics of discussion included the power issues being faced due to the lack of capacity by PNG Power to supply Kavieng town.
Alternative solutions to the problem includeed the use of LNG and the New Ireland government’s preferred energy solar power.
3 comments
Good point Sir Julius. Gold has improved significantly in value in the last two years. Why is Prime Minister Marape unwilling to work out an agreement with Barrick to get the Porgera Joint Venture project on its feet again? PJV was the biggest employer in the country but now all 2700 employees are out of a job. Please, Mr Prime Minister, sit down at the negotiating table with Barrick and Zijin and hammer out an agreement. It would be a win/win situation.
This is great for PNG but what actually comes back to the people of PNG? Barrick and other mining giants started from somewhere to today they are huge, PNG is doing The right this to take everything back so we claim 100% interest before all our resources are depleted completely for the future generations.
Developers only come to make money and leave back to their countries leaving developing nations collect the scraps.
I rather earn the complete k6000 then to collect only k1000
This so called Foreign Investors have taken us for granted and took advantage of our simplicity for far too long.
It’s time for us now to be strong, stand firm and say enough is enough. We can’t continue to dance to their music.
All they have done is, left us with the trail of untold destruction on our environment and left only bones for us to collect after depleting our resources.
Classic example is the amount of damage BHP has done to the vast expanse of river systems, swamplands, and general vegetation in Western Province.
It will take hundreds of years for the damaged environment to grow back to it’s normal capacity.
We must strive for fair deals in the development of all our resources so the country and it’s people must receive the maximum benefits.
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