Barrick Niugini Limited and the Government of Papua New Guinea have reached an agreement on a binding framework agreement, the first step in the process to reopen the Porgera Mine.
The agreement was signed at Government House by Barrick Chief Executive Mark Bristow, Governor-General Sir Bob Dadae, and Mining Minister Hon Johnson Tuke on behalf of the State of PNG, and Kumul Minerals Holdings Limited Chairperson Nellie James on behalf of Kumul Minerals Holdings Limited.
The Porgera Mine will be operated by a new joint venture that will be 51 per cent owned by PNG partners and 49 per cent owned by Barrick Niugini Limited, who will continue to operate the mine.
The framework agreement also includes provisions for, among other things:
- BNL to fund the resources needed to restart the mine;
- A raise in the equity assigned to a large community of landowners who are the customary owners of the property where Porgera is located;
- PNG stakeholders and BNL to share the economic benefits provided over the mine's existence on a 53/47 per cent basis.
- After ten years, the state will have the option to purchase the remaining 49 per cent of the mine from BNL at equal market value.
The agreement not only outlines prospective benefit-sharing principles and potential operating plans for the mine, but it also lays out the final compliance agreements that must be completed before mining at Porgera can resume – this is expected to happen later this year if mutually agreed conditions are fulfilled.
The firm will continue to work with the State Negotiation Team and other government departments to conclude these procedures in the coming months.
Although negotiations between BNL and the National Government continue, current Care and Maintenance operations at the mine site will continue.
The status of the resumption of mining at Porgera will be updated on a regular basis in the coming months.
