Photo credit: Papua New Guinea Today - PNG Government, Barrick Niugini sign Agreement to reopen Porgera Mine
The Porgera Project Commencement Agreement was signed by the State and Barrick Niugini Limited, paving the way for the commencement of mining activities at the Porgera Mine.
Prime Minister James Marape confirmed the government's commitment to reopening Porgera Mine as soon as possible, with BNL as an equity partner and operator, and vowed to provide BNL the certainty it needed to go from care and maintenance to mine reopening.
He said that the commencement agreement is the master agreement that details the parameters agreed to in the historic Project Porgera Framework Agreement signed in April, while the Shareholders Agreement, Operatorship Agreement, and MDC are still being finalized.
The following are some of these terms:
- On a 53/47 basis, PNG stakeholders and BNL will share the economic advantages achieved during the mine's lifetime.
- BNL will provide the necessary funds to reopen the mine.
- A large number of landowners who are the customary owners of the land where Porgera is located will get an increase in equity; and
- After ten years, the State will have the option to purchase the remaining 49% of the mine from BNL at fair market value.
“The commencement agreement provides a framework for their negotiation and will help accelerate progress on the remaining steps so that Porgera can be reopened,” Marape said.
He urged all parties, particularly the Porgera landowners and community, to band together and work with the government and BNL to establish the proper conditions for the mine to resume, including addressing the Porgera valley's peace and order situation.
“We look forward to the setting up of the New Porgera Project Company and for work to begin in preparation for the processing of gold ore at the soonest possible date.
Porgera’s restart helps PNG get back more for our people, creating local jobs and contracts in partnership with one of the world’s leading mining companies,” Marape said.
On behalf of BNL shareholders Barrick and Zijin Mining, Barrick chief executive officer Dr Mark Bristow urged all parties to redouble their efforts and complete the remaining agreements as soon as feasible.
“As we move toward starting up mining operations, our common task is to negotiate expediently and in good faith so that Porgera, a mine with enormous potential, can resume production and take its place as an engine of the PNG economy and contributor of foreign exchange once again,” Dr Bristow said
Dr. Bristow and Marape agreed that their negotiating teams will continue to work closely together in the coming weeks to ensure that all remaining criteria for the resumption of operations at the Porgera Mine are satisfied as soon as feasible.
Reference: Post-Courier (18 October 2021). “Govt, Barrick Sign Porgera Mine Commencement Agreement”.
