Photo: President of the PNG Chamber of Mines and Petroleum Mr Anthony Smaré
Last year, the 16th Papua New Guinea Mining and Petroleum Investment Conference and Exhibition was held from 5th to 7th of December 2022 at Sydney Hilton Hotel. The event was hosted by the Papua New Guinea Chamber of Mines and Petroleum with the theme "PNG Resources: Securing the next wave of responsible investment”.
There were over 1,000 delegates from industries related to global hydrocarbon, minerals, and energy industries. Other participants are government officials, landowners, and those from the international investment sectors. [1]
The conference seeks to highlight investment and development opportunities that PNG can offer.
Honorable James Marape (MP) - PNG Prime Minister, provided the keynote address on Day 1. Other notable speakers include Mr Anthony Smaré - President of the PNG Chamber of Mines and Petroleum, Pat Conroy - Australian International Development Minister, Honorable Ano Pala (MP) - Minister for Mining (PNG Government), and Honorable Kerenga Kua (MP) - Minister for Petroleum (PNG Government).
In Mr Anthony Smaré’s opening address, he mentioned that foreign investments play a significant role in the development of PNG and have a catalysing impact on the PNG’s economic development.
He stated that the country has five major projects coming up including the Papua LNG Project, Wafi-Golpu, Pasca, and the reopening of Porgera and P’nyang.
Prime Minister Hon. James Marape delivering the Keynote Address at the 16th PNG Mining and Petroleum Investment Conference and Exhibition.
In his speech, Prime Minister James Marape encouraged investors on PNG’s potential, and inspired partnerships in development on the ground.
He said, “We are a mineral and petroleum nation. We know how to give incentives, embrace and protect investors, and allow investors to make a fair and profitable return on their investments.”
“The next wave or first waves of responsible investments, or I would rather say ‘responsive investments’, are our big five projects that my government has worked on the last three years where deep in my planning office we label them as “PPPPW”.
Prime Minister Marape also mentioned that PNG is expecting positive future projections for growth and stands to reach a 200-billion-kina economy, but it must include local involvement.
“You take my gas, and you take my people with you, we will support everything you do, it wasn’t a literal statement to taking my people with you, but for the betterment of their life,” he said.
In relation to this, Mr Smare noted that PNG’s resource growth is over K30 million and is expected to grow exponentially.
“As I discussed with PM Marape yesterday, his government is now at a unique juncture in our nation’s history. It is the first time that our country is on the cusp of delivering not one, but four major resource projects of over $30 billion. Papua LNG with its $12 billion capital cost, Pnyang at $10 billion, the reopening of Porgera, and Wafi Golpu Copper-Gold project at $6 billion or potentially higher. Add the Pasca gas project at $2 billion and one can understand why negotiating all these deals at the same time has placed the government negotiation machinery under significant strain.”
Moreover, he pointed out Australia’s continued support as a development partner to PNG but highlighted that future investments projects could also include other global economies like China.
“China is a very important partner of our country. It plays a significant role in our economy currently. It has interests in a number of our mining projects – a quarter of Porgera through Zijin Mining, and the majority interest in the Ramu Nickel-Cobalt mine through MMC. China is a buyer of much of our current minerals output. China is also a significant buyer of our LNG production from the PNG LNG, and it will likely be a major buyer of gas from our new LNG developments – Papua LNG, Pnyang, and Pasca.”
Hon. Pat Conroy, MP, Australian Minister for International Development and the Pacific
Honorable Pat Conroy, Australian Minister for International Development and the Pacific, said that Australia does need to step up participation in the development of PNG.
"All of our investments in Papua New Guinea are squarely aimed at helping Papua New Guinea achieve its economic and development priorities. We’ve provided budget support loans of around $1.2 billion in 2020 and 2021, to help Papua New Guinea repair its budget out of the pandemic. And we are supporting the Papua New Guinean Government’s efforts to make Papua New Guinea a more attractive place for business activity and investment.”
The Minister noted that they are aware of how much the mining and petroleum sectors contribute to Papua New Guinea’s economy. “We are both countries with abundant natural resources. We are both countries with significant mining sectors which have been fundamental to our economic development – supporting growth, exports, and jobs.”
“Many of the Australian mining and petroleum companies represented at this conference have made significant investments in economic and social development, spanning decades of engagement with communities from Western Province to the New Guinea Islands.”
In relation to Australia and its historic relationship with PNG, Mr Smaré acknowledged that Australia remains a vital development partner to PNG, but pointed out that the country no longer holds the position as dominant investor in PNG.
“Much of the Wau-Bulolo gold rush of the 1920s was funded by Australian capital, and Australian funded explorers and mining companies discovered and/or developed much of our most important projects – for example, Conzinc Rio Tinto found and developed Panguna, Australia’s BHP was the majority partner who developed Ok Tedi in the early 1980s, Australia’s Niugini Gold discovered Misima and Lihir, and Rio Tinto was the majority partner in the development of Lihir in the early 1990s.”
He mentioned that Australia remains one PNG’s most important investors, but for the past 15 years, the resources and energy sector has seen major investments from other countries like US, Canada, France, and China through multiple large-to-mega investments.
In closing, Mr Smaré’s addressed a question to the Australian audience. “So, what role will Australia play in PNG’s development going forward?”
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The Papua New Guinea Chamber of Mines and Petroleum also announced that it is considering a name change to PNG Chamber of Resource and Energy (PNG Core) to better reflect the change in the commodities produced by the sector in PNG. This announcement was made by Mr Smaré during the conference.
“The Governing Council of the Chamber has resolved to change its name to the PNG Chamber of Resources and Energy (PNG CORE) to encompass a better representation of the industry that it represents, and the exports that its members will be exporting to the world.”
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On the second day of the conference, the speakers discussed project updates from some of PNGs biggest resource companies.
ExxonMobil PNG’s Senior Vice President of Production, Scott Sandlin, gave updates on the progression of the multi-billion Kina PNG LNG project. The project aims to achieve long-term economic development.
For the next 11 years, nationally owned Ok Tedi Mining Limited is expected to generate over K19 billion in benefits for Papua New Guinea. OTMLs General Commercial Manager Cameron Clark said: “The outlook for Ok Tedi is a positive one. The Company has tripled its value in the last 6 years and extended mine life by 7 years. This has been made possible by a combination of technical improvements, cost improvement, accelerated mining rates and internal investment in key strategic projects”
Moreover, Simberi St Barbara has been given the permit for sulphides expansion which adds at least another 10 years of mine life from 2024 - 25 when oxides are depleted. The sulphide expansion is under a strategic review by operator St Barbara Limited. Simberi is pursuing cocoa and fisheries (with partners) as its best opportunities for sustainable development.
Hon. Kerenga Kua - Minister for Petroleum
Petroleum Minister Kerenga Kua stated that PNG’s petroleum sector is “in a robust state” with 94 active licenses. He believes that having 58 prospecting licenses and 10 PDLs as well is a good starting point for PNG towards a prosperous future.
During his speech, Mining Minister Hon. Sir Ano Pala mentioned that the Mineral Resources Authority (MRA) is processing and monitoring over K45 million worth of new capital investments in mining projects, and about K10 billion worth of investments in sustaining capital expenditure on existing mines. [2]
Minister Hon Ano Pala speaking at the conference.
He noted, “I’m very pleased to announce that some very important mining projects had already been permitted whilst others are currently going through the permitting process. These projects are worth a total of K13 billion of potential new capital investment. Projects going through the permitting process are the K5.3 billion Wafi Golpu Copper project, comprising K 2.5 billion sustaining capital expenditure, and the K7.2 billion Freda River copper and gold project." [2]
The projects that have been permitted are the Woodlark Gold Project and K3.331 billion Central Lime Cement Project. Additionally, Ramu Nickel Cobalt mine will be undertaking a K1.5 billion expansion program.
Hon. Ano Pala also mentioned that the government had granted the approvals for the conversion from oxide to sulphide ore processing for the Simberi project. The government also granted the extension of the Mining Lease for the Hidden Valley Project. The application for extension of the Special Mining Lease for Ok Tedi Mine and K92 Mining Lease have recently been processed.
He said, “We are confident of permitting Wafi and Freda River projects upon completion of negotiations in the coming weeks. Wafi is going well. The gaps in the negotiations are narrowing now, and we are confident that in the coming weeks, we will make the announcement. These mega projects will off course take 5-7 of years of construction and we hope to see this mining projects operationalized well before 2030.”
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Photo credits:
PNG Chamber of Mines and Petroluem - https://pngchamberminpet.com.pg/media-centre/news-releases
Mineral Resources Authority - https://mra.gov.pg/2022/12/07/16th-png-png-chamber-of-mines-petroleum/
Reference:
[1] PNG Chamber of Mines and Petroluem - Media Release -
https://www.pngchamberminpet.com.pg/index.php/media-centre/news-release-view/2022-16th-png-mining-and-petroleum-investment-conference-and-exhibition-programme
[2] Mineral Resources Authority (7 Dec. 2022). "16th Papua New Guinea Mining and Petroleum Investment Conference and Exhibition". Media Release.
Retrieved from - https://mra.gov.pg/2022/12/07/16th-png-png-chamber-of-mines-petroleum/
