MINING
Porgera: the litmus test When it happens, the reopening of the Porgera gold mine in Enga Province will mark a significant milestone for Papua New Guinea’s mining sector – and its relations with government. No mining venture is more of a test of the James Marape-led government’s ‘Take Back PNG’ agenda than the Porgera gold mine in the Highlands province of Enga. The mine was closed in April 2020 after the expiry of its original special mining lease as the government sought to negotiate a lease renewal on better terms. Two years later, the mine—which produced 600,000 ounces of gold in 2019 and was the country’s largest gold mine—remains unproductive, but there has been slow and steady progress towards a 2022 reopening. The Porgera Project Commencement Agreement (PPCA) was signed in October 2021 between the State’s nominee, Kumul Mineral Holdings,
THE FORMAL EXECUTION OF THE PPCA REPRESENTS IMPORTANT PROGRESS
CREDIT: BARRICK NIUGINI LTD
per cent of the mine from BNL at fair market value after 10 years’. and mine operator Barrick Niugini Ltd (BNL, a joint venture between Canada’s Barrick Gold and China’s Zijin Mining). The PPCA is the ‘master’ agreement that details the terms under which the mine will reopen. Mineral Resources Enga, the 50/50 consortium between the Enga Provincial Government and Porgera landowners, finally signed up to the PPCA in February 2022, affirming landowner and local government support for the mine’s reopening. As well as giving Kumul Minerals Holdings Ltd and Mineral Resources Enga between them 51 per cent ownership of the mine, it is understood the Commencement Agreement also provides for Barrick Niugini to finance the mine’s reopening and gives the State the right ‘to acquire the remaining 49
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Important progress ‘The formal execution of the PPCA represents important progress,’ says Barrick Gold’s President and Chief Executive Officer Mark Bristow. ‘Our task now, in partnership with the State, is to accelerate the process so that the new company, which will be 51 per cent majority owned by Papua New Guinean shareholders, is incorporated and a sound tenement granted, enabling the mine to reopen at the earliest opportunity.’ At the time of writing, there are still several steps that need to be completed before the mine can reopen, including the incorporation of the new Porgera joint venture company, the issuing of a new special mining lease and an operatorship agreement.
