Once the backbone of the Papua New Guinea economy, Panguna has been idle since the civil war began more than 30 years ago — a war the mine was at least partly responsible for.

But now the leaders of the five major clans in the Panguna area — Basikang, Kurabang, Bakoringu, Barapang and Mantaa — have said they will allow the mine to reopen.

Don Wiseman of RNZ Pacific asked Islands Business specialist writer on PNG Kevin McQuillan about the significance of the decision:

KMcQ: “This is hugely significant. It’s significant for the people of Bougainville, the Bougainville Autonomous Government, the national government, and, dare I say, probably the whole region. But on the other hand, it also creates a huge dilemma for the national government. Panguna was probably the second biggest copper and gold mine in the world, and at one point and accounted for two fifths of Papua New Guinea’s GDP.

“So when it was operating, that was a huge source of income for the national government. But it wasn’t so much of course, for the people of Bougainville, which prompted the 10 years civil war in part. The other element of that civil war, apart from the poor income that the operators gave the people of Bougainville was the environmental damage to the island of Bougainville.”

DW: President Ishmael Toroama has said that being able to open Panguna again is a critical step on the road to independence, in terms of showing economic viability.

KMcQ: “Yes. And that’s reflected also in the fact that there’s been mounting pressure over the last probably 10 or more years for the mine to open because the generations coming through have had very little in the way of food, shelter, clothing, educational opportunities, so on and so forth. And a lot of that pressure to reopen has come from the younger generation, because they want the opportunities that they know exist.

“For the national government it creates the dilemma of having agreed to discuss Bougainville breaking away, but not wanting to break away. What does it do to keep Bougainville within the fold, because the potential income for not just for Bougainville but for the country as a whole is enormous — 42 percent of GDP when it was operating.

“It may not be as much when it does get back up and running, but it will certainly be a significant contributor to the PNG economy. So where [Prime Minister James] Marape and whoever takes over as prime minister, if he loses the election this year, goes with discussions on Bougainville and its independence is hugely significant for the country as a whole.”

DW: This idea that President Toroama has of it being a conduit to independence may in fact work in the other direction.

KMcQ: “Well, it all depends on the negotiating skills really. The other element that comes into play is that BCL — Bougainville Copper Ltd — is now jointly controlled by the Papua New Guinea government and the Bougainville Autonomous Government, through a company called Bougainville Minerals Ltd. They both own a 36.4 percent share in Bougainville Copper.

“Over the past few years there have been promises from the national government to transfer that 36.4 percent shareholding that the national government has to the people Bougainville, which would give it roughly 72 percent shareholding in Bougainville Copper. It’s never happened.

“The national government has held off transferring that money despite the promises that it would do so. And this is going to be a key negotiating point in the future of independence. The national government, of course, does not want Bougainville to go independent. And there are options. There are other options.

“It’s not a binary choice of either independence or not. It could be that the negotiations see the Bougainville area stay within, if you like the parameters of Papua New Guinea, but having a high degree of independence. But whatever that actually means, nobody’s really going to know until the negotiations finish.”

DW: Yes. So the PNG government could hold on to shareholding and still earn from Panguna. Even if it went to this lesser form of independence.

KMcQ: “Yes, it could. But you can really bet your bottom dollar that if the national government holds on to its 36.4 percent shareholding, which was given to it by Rio Tinto, despite those promises, that will be a matter of a court case.”

DW: Now you talk about a lot of people being very keen to see the mine reopened. But there are also many, many people who certainly don’t want to see it reopen.

KMcQ: “They do but what has given this announcement the impetus is that clan chiefs’ representatives from the five major clans from the area have agreed to this resolution to re-open the mine.

“There will always be opposition to reopening the mine. There always has been, even over the last 10 years, when previous president of Bougainville, Fr John Momis, wanted the mine to reopen.

“There was a significant minority. Well, a vocal minority is probably more accurate, deeply opposed to the reopening of mine on environmental grounds.”

DW: With these announcements the minuscule share price for Bougainville Copper has soared.

KMcQ: “Well, it has doubled on news of this announcement. And it means that BCL has a market capitalisation of around about NZ$260 to NZ$265 or NZ$270 million . The point about the doubling of the share prices is the support that it reflects for the re-opening of mine.

“Plus it also, it paves the way for a company to be a little bit more settled in the prospects of the process of reopening the mine. The last valuation that they had to reopen the mine, which was several years ago now, said that it would cost between around about NZ$6 billion to reopen the mine. But over its lifetime, it would earn roughly $75 billion.

“So it’s a high risk, high reward investment. But the fact that this resolution has been made, declared, share prices doubled. It means that Bougainville Copper is probably a lot more confident this week than it was last week that it could go ahead and do some preparatory work for the reopening of the mine, which could take five to seven years.”

DW: They are just eyewatering figures aren’t they?

KMcQ: Well, it shows the potential. I mean this is a mine that was the second biggest gold and copper mine in the world. And there will be a lot of companies, global companies keen to get involved. Rio Tinto has put its fingers into the air and sniffed the wind and it realises that this could finally happen.

DW: You mean Rio Tinto is lining up to to work with its former company?

KMcQ: “Well, it certainly looks that way. In 2016, because of the criticism that Rio Tinto had, or was receiving because of the huge environmental damage that it caused to the Bougainville area, it gave away its mine.

“It had a choice of either fixing up the environment or walking away, as it saw it. So it walked away — gave those shares equally to the Bougainville government and the national government. But now it wants to get back involved.

“And over the last week it has been talking about repairing some of the environmental damage that it caused during the mine’s operation. But there are other companies involved around the world, which could get involved.

“I’m thinking Glencore, the Swiss-based development company could get involved as well. Now, the reason why this is important is because BCL does not have the financial wherewithal to go and reopen the mine at a cost of $6 billion.

“And it’s only gotten roughly NZ$260 million in play. And really, it doesn’t have the expertise to reopen the mine, develop it, run it. It would have to go into partnership with one of the big mining companies Rio Tinto, or Glencore, or somebody else.

“The former president, Sir John Momis, had negotiations or had talked to China about the possibility of a Chinese company moving in and developing the mine. So in the current climate of debate around China’s role in South Pacific, one has to wonder just what impact that might have on the Australian, New Zealand, American governments.”

This article is republished under a community partnership agreement with RNZ.

Article by AsiaPacificReport.nz

Bougainville’s retiring president says some candidates are bullying or offering inducements to buy their way into the new parliament.

John Momis first raised his concerns while speaking during Papua New Guinea’s 45th anniversary celebrations on Wednesday.

Momis praised the success of PNG’s constitution, and contrasted this with the way some in Bougainville were flouting the Bougainville constitution.

He said these people were not respecting the rule of law which was the essence of democracy.

Momis said some candidates had used a variety of tactics, including money inducements, to frighten people into submission.

“Because, I guess, because we have a very weak police, rule of law is a very real problem in Bougainville,” he said.

“Especially this year when you don’t have international observers here for the elections, it’s quite clear that some people were more or less forcing people to vote for them, or using all types of propaganda to get people, to scare them into submission.”

Momis, who is due to finish his 10 years as Bougainville’s president in the coming week, said some parties, including his own, were preparing demands for vote recounts.

The election count was this week extended by nine days with the Electoral Commissioner, George Manu, saying there were about 30 percent more voters and candidates than in the last poll.

Manu hoped to finish the count on Tuesday or Wednesday, with the writs to be returned to the Speaker next week on September 24.

This article is republished by the Pacific Media Centre under a partnership agreement with RNZ.

Article by AsiaPacificReport.nz

Thomas Raivet has roared into contention as the Bougainville presidential vote count continues while former rebel military leader Ishmael Toroama retains the lead.

Raivet, who is the surrogate for retiring President John Momis, is now in second place behind Toroama.

In third place is the former president, James Tanis.

Toroama believes that as the vote count moves north he will continue to hold his lead, though Tanis says it is too early to call.

Raivet was put forward as a candidate after the Papua New Guinea Supreme Court ruled out Momis’ bid for a third term.

He is a former naval captain and has been the acting chief secretary of the Bougainville government.

There are 25 people contesting the presidency and the proportional voting system in Bougainville means votes are re-allocated when candidates fade during the count.

Meanwhile, a number of constituency seats have been decided and they include one notable loss, that of Albert Punghau, in the Siwai district.

Punghau, as the Minister of Peace Agreement Implementation, had been instrumental in ensuring last year’s referendum on independence from PNG went smoothly.

This article is republished by the Pacific Media Centre under a partnership agreement with RNZ.

Article by AsiaPacificReport.nz

An almost half-empty Bougainville House of Representatives has farewelled John Momis, the region’s longest serving president to date and a senior Papua New Guinea statesmen,  in a shunned and scandalous lack of attendance in the final session of the Parliament on Friday.

The Bougainville Legislature has 40 Members. However, The Bougainvillean counted not more than 20 of them present.

While President Momis and his 10-member Cabinet were present, many other seats of constituency members in the chamber were empty.

Some members left the session halfway through, while others took their leave soon after paying their tributes to the out-going president, who is one of the co-authors of the national constitution and father of decentralisation in the country.

President Momis had taken up to an hour with his final address to the House of Representatives – recounting his political life since 1972, and the floor was then opened up for tributes.

With almost 50 years in politics, many members remembered Momis as a young, spirited Catholic priest with political intentions.

Born during World War II, Momis has been acclaimed on the world stage as well as papua New Guinea, as someone who strives to empower people realising their potential.

Public seek independence
But the now 81-year-old has been viewed by analysts as more in favour of continued autonomy and continued integration with Papua New Guinea – a view not shared by some MPs and the wider public who are for outright independence and severing of political ties with mainland PNG.

Many MPs praised his leadership and his mentoring and ability to weigh up options and his use of peaceful means to consult and achieve his government’s goals and desires.

Momis’ Post Referendum Consultation and Dialogue Minister Albert Punghau said many Bougainvilleans still wanted him to continue his leadership, and he could easily be returned if the courts had not ruled him ineligible to contest a third term.

Fidelis Semoso, the Member for Tsitalato, former national MP, former cabinet minister in an earlier Momis government and Momis’ political rival for the last two years, said politics would remain politics and that he had nothing personal against Momis. He described Momis as having served both Bougainville and Papua New Guinea in an “illustrious” career.

“What me and my B-14 group stood for then, was not personal,” he said.

“We only wanted to protect the constitution and ensure there is rule of law which has been confirmed by the Supreme Court.

“You should rest assure that you have mentored and created many young leaders, who will carry on the dream of Bougainvilleans from here on.

“The other part of your legacy is leading Bougainville to achieve the 98.2 percent referendum result which has been praised both locally and internationally as a well-conducted and credible vote.”

Semoso also did not hide his intention of replacing President Momis – “God willing”, he said.

Luke Karaston, the Minister for Technical Services and Member for Suir, said President Momis would be remembered for being there and helping to bring Papua New Guinea into independence and now ushering in a resounding result in the referendum which would pave the way for consultation with the national government.

• Three weeks are being allowed for the Bougainville election – August 12 until September 1 – due to the covid-19 alert in Papua New Guinea.

Article by AsiaPacificReport.nz

Philippine President Rodrigo Duterte exposes “illegal favours” to mining tycoon Eric Gutierrez, whose company SR Metals Inc has now won an exploration contract on Bougainville. Archlight Productions video shot during 2016 presidential election campaign.

BACKGROUNDER: PNG Mine Watch

Mine Watch recently predicted that Bougainville President John Momis’ appetite for crooked foreign miners was very much alive. How right we were.

In a gushing column in the Post-Courier – which reads like a salivating love poem – it was announced that President Momis had teamed up with his former nemesis – money bridges all divides – Sam Kauona to bring in a Filipino mining company to explore 183 square kilometres of land.

The company is called, SR Metals Inc., and is led by Eric Gutierrez. It has come to “liberate” Bougainville from its bloody history, we are told.

READ MORE: Philippine mining company wins Bougainville search licence

Now while we might want to believe the Post-Courier, John Momis and Sam Kauona, as entities of integrity who would never lie, the ever sceptical PNG Mine Watch team decided to look at the track record of SR Metals Inc. and Eric Gutierrez.

What did we find?

Report after report in the Filipino press accusing SR Metals and its chief of corruption, clientalism, and illegal mining.

Indeed we are told Gutierrez is very fond of funding politicians who are good for his business.

‘Duping government’
And, no less, he has been accused of using fraud to “dupe the government and their business partners of billions of pesos in mining revenues”. Guess they saw President Momis and Kauona coming.

To cap it off, the company SR Metals, has been fined for environmental violations.

And a Senate inquiry found the company “over-extracted 1.8 million tons of nickel ore”, in violation of regulations. 

• Philippine mining company wins Bougainville search licence
• Landowners and companies in new battle for Panguna mine
• Candidate Roxas’ mining cronies
• Gutierrez charged with falsification
• Mining ban still in effect, says Roque
• SR metals trending stories

Article by AsiaPacificReport.nz