THE landowners of Porgera Mine and other stakeholders in the valley in Enga province are happy and looking forward to welcoming the State and Barrick Niugini Limited (BNL ) teams today under tight security.
Porgera based landowner leadership have been conducting community awareness following the signing of a Framework Agreement between the State and BNL in April which paves the way for the reopening of the mine.
The mine was closed for over 14 months since April last year after its 30-year mine lease expired, thus many direct employees, contractors landowners have been hard hit.
During the community awareness activities key aspects of the Framework Agreement that impact landowners have been shared.
According to the milestone agreement, a joint venture between PNG (51% equity) and BNL (49% equity) will own and operate the Porgera Mine. The mine is on track to resume operations later this year, with BNL to finance the restart.
The framework agreement also provides that PNG stakeholders and BNL will share the economic benefits generated over the life of mine on a 53-47% basis.
There will be an increase in the equity allocated to a broad group of landowners who are the customary owners of the mine area, with the State to retain the right to acquire the remaining 49% of the mine from BNL at fair market value after 10 years.
The new deal secured an additional 1 % royalty taking Special Mining Lease (SML) Landowners and the Enga Provincial Governments royalties to 3%. The wider Porgera community also stands to gain with BNL paying US$3 million (K10.6 million) annually for 10 years to Porgera Sustainable Development Fund, and a further US$15 million (K53.3 million) upfront to the appropriate categories of landowners.
Prime Minister James Marape during the signing of the new Porgera deal in Port Moresby said unlike the old structure, the new structure or deal is in favour of PNG stakeholders, and the opportunity for landowners to increase their equity beyond with the additional 10% free equity paid for by Barrick.
“The royalty paid was 2% to the SML landowners and the EPG but the new deal secured an additional 1 % to 3%. Up to 2019, the economic split stood at around 25% for the PNG stakeholders with equity and taxes, whereas the new deal will see that move to around 53% in favour of the PNG stakeholders over the full life of the mine,” Marape said.
Barrick CEO Mark Bristow said Barrick on behalf of BNL’s joint venture partners Barrick and Zijin Mining was delivering on its promise of reaching a fair agreement on the future of Porgera for the benefit of all its Stakeholders notably the local community, Enga province and the PNG government.
“We intend to partner with all key stakeholders to make Porgera a world-class long-life gold mine,” he said.
Local landowners and Papua New Guinea are the big winners in the deal negotiated by Prime Minister Marape and BNL with the support of Porgera landowners.
The landowners now enthusiastically await the arrival of Prime Minister Marape and Barrick President Mark Bristow for an Equity Forum to be staged in Paiam, Porgera.
“We thank all parties, including the various landowner groups for coming together to negotiate a win-win outcome for all. As awareness efforts amp up in the leadup to the visit, the sentiment on the ground is clear.
“Welcome Prime Minister and welcome Mr Bristow, Porgera stakeholders are behind you and ready to work with you and the New Porgera,” the SML landowners said in a statement.
Awesome news for the LOs and the mine
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