Reforms can achieve positive outcomes in resources sector

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Positive outcomes for major resource projects can be achieved by ensuring the country’s policy and legislative reforms adopt internationally accepted practices, says Mining Minister Johnson Tuke.
He told the PNG Mining and Petroleum Conference in Sydney yesterday that leakages and loopholes within the system had to be minimised to allow the people to benefit.
“As the minister responsible for mining, I am always proud to state that the mineral sector remains the backbone of the economy of our country,” he said.
“In the last financial year, the mining sector achieved record export revenue of K11.5 billion.
“This represented 18.6 per cent of total PNG gross domestic product.
“Within that revenue, total gold represented 69.8 per cent of export revenue, copper 18 per cent and nickel was the big mover at 7.5 per cent.”
Tuke also provided summary of the status of some individual approved mines that contributed significantly to the country’s economy:

  • Lihir last year achieved a record level of export revenue of K3.6 billion and production and revenue to date in 2018 are ahead of last year. Royalty of K74.31 million was paid in 2017 and K55.32 million has been paid up to Aug 2018;
  • Ok Tedi ranks second in PNG and has increased its revenue in 2017 by 52 per cent to K3.179 billion. A total K48.97 million in net royalty was paid in 2017 and K26.2 million has been paid up to Aug this year;
  • Special mining lease for Porgera mine is due to expire next year and the process for extension has been the subject of discussion. In 2017, Porgera paid royalty of K42.38 million and to Aug this year they had paid K20.83 million;
  • Simberi mining lease has reached its expiry date but MRA has received an application for extension. Simberi exceeded production and revenue expectations. Revenue is expected to exceed last year at over K550 million. Royalty of K9.97 million was paid in 2017 and to Aug 2018, K6.72 million has been paid;
  • Hidden Valley mine made alterations to its mining method during a temporary closure in 2017 under new owners Harmony Gold. Production is now ramping up with 130,596 ounces of gold produced to Oct 2018 and revenue of K620 million to date. Royalty of K6.49 million was paid in 2017 and this has already been exceeded in 2018 with K9.55 million paid to Aug 2018;
  • The K92 underground mine in Eastern Highlands has continued to operate to its forecasts despite a recent tunnel collapse. Up to Oct 2018, it has produced 37,492 ounces of gold, together with silver and small amount of copper achieved revenue of K118 million; and,
  • For the Frieda River project, work has unfortunately not progressed well.