Barrick Gold Corporation, one of the world’s largest gold mining companies, has announced that it has received approval from the government of Papua New Guinea (PNG) to resume operations at the Porgera mine, which has been on care and maintenance since 2020. The mine, which is located in the Enga province of PNG, has an annual production capacity of 700,000 ounces of gold.
The approval comes after months of negotiations between Barrick, its joint venture partner Zijin Mining Group, and the PNG government, which resulted in a new ownership and benefit-sharing agreement for the mine. Under the new deal, PNG stakeholders will own 51% of the mine, while Barrick Niugini Limited (BNL), which will operate the mine, will hold 49%. Economic benefits will be shared by 53% of the PNG stakeholders and 47% by BNL.
Barrick president and chief executive Mark Bristow said that the new agreement was a “win-win” for all parties and reflected Barrick’s commitment to partnership with its host countries. He also said that the mine was positioned to restart before the end of this year, subject to an agreement on compensation with local landowners. Recruitment was being accelerated to employ the full workforce that would be required when the mine started ramping up operations.
The Porgera mine is one of the world’s largest and most complex gold mines. It has operated since 1990 and produced over 20 million ounces of gold. However, it has also faced environmental and social challenges, such as allegations of human rights abuses, environmental damage, and illegal mining activities. The PNG government refused to renew BNL’s mining lease in April 2020, citing these issues and claiming that the country did not receive a fair share of the mine’s profits.
The decision sparked a legal dispute between BNL and the PNG government, which was resolved in October 2020 when both parties agreed to enter into negotiations for a new deal. The negotiations involved consultations with various stakeholders, including provincial and local governments, landowner groups, and civil society organizations. The new deal was signed in April 2021 and ratified by PNG’s National Executive Council in August 2021.
The restart of the Porgera mine is expected to boost PNG’s economy, which has been hit hard by the Covid-19 pandemic and low commodity prices. According to PNG’s Prime Minister James Marape, the mine will contribute about 10% of the country’s gross domestic product and generate significant revenues for the government and the local communities. He also said that the new deal will ensure that the mine operates responsibly and sustainably, respecting human rights and environmental standards.
The Porgera mine is not the only mining project attracting interest in PNG. The country is also home to other large-scale mineral deposits, such as the Wafi-Golpu copper-gold project and the Frieda River copper-gold project, which are awaiting development approvals from the government. PNG has a rich endowment of natural resources and a strategic location in the Asia-Pacific region, making it an attractive destination for mining investment.
Source: Mining.com
