Marape's Porgera Deal is no Deal, says PNG Opposition
Papua New Guinea Prime Minister James Marape’s Porgera new deal has ceded virtually everything to Barrick and its Chinese partner Zijin Mining Group and left PNG an empty promise on paper, the Opposition said today.
Mr Marape visited Porgera over the weekend to announce the new agreement which he describes as “superior” and a “way forward” but which in truth has nothing for PNG.
Leader of the Opposition Belden Norman Namah said since the signing of the Framework Agreement last month the PM has given the nation only percentage figures and vague notions, no real facts.
“At Porgera last weekend we finally realised that there is nothing in this new deal for which PNG has closed an operating mine and forgone billions in revenue and benefits.
“In the end, the same miner remains on terms that are far superior than previously where it can now keep almost all the revenue from the mine for the next ten years.
“At the weekend the Prime Minister was again vague and appeared clueless as to what the real deal is,” Mr Namah said.
“Even those who have supported Marape and claim to have financed the ‘new deal’ have described the PM’s speech at Porgera as ‘sad’ and ‘lacking substance’.
“Marape, it seems, has already forgotten the reasons he gave originally for rejecting the re-granting of an SML to Barrick Gold.
“The reasons Barrick was rejected were outstanding environmental landowner relocation, outstanding taxation and humanitarian issues.
“I am told these issues never came up in the PM’s speech.
“Instead the PM and his cohorts got excited about the 51/49 percent deal which every grade school child in Porgera must know already by now.
“Let me tell the PM that the 51 percent deal is worthless.
“The landowners, Mineral Resources Enga, Kumul Minerals, and the Enga Provincial Government will not receive any dividends over the ten years that Barrick has agreed operate the mine except for taxes and royalties.
“The Framework Agreement(FA) states that Legacy issues are in the "OLD PORGERA BASKET".
“What does that mean? Why has Marape allowed this when it was legacy issues that he used to refuse renewal of the Special Mining Lease in the first place?
“Will the old Porgera legacy issues be transferred to the new Porgera deal or will it be left to PNG and only assets are transferred? This was critical and central to the entire shutdown which has cost the nation, provincial government, landowners, contractors and employees hundreds of millions of kina.
“How will State and Barrick compensate for the Legacy issues?
“This is the question raised by those closest to Mr Marape in this issue.
“The real questions that need answering are the following:
“Who is paying for PNG’s 51% equity? Where is the money coming from? If it is a loan, what is the source and what are the terms for this loan?
“If Kumul’s 36% is to be paid for by Barrick and recouped over the next 10 years, there can be no dividends paid to Kumul and the State and then where does Kumul find money to buy 100 percent of the mine when it is due in ten years as per the Marape deal?
“KMHL will not receive any cashflow until at least year 2031.
“The L.O 10% and MRE 5% will also presumably be paid by Barrick but we have no details as yet.
“The PM is also silent the future of the Porgera work force and current contractors of the mine.
“Barrick will take home almost all dividends for the next ten years in addition to a hefty management fees and equal representation on the board.
“How is this a good deal for PNG, Mr Marape?
“The worst part if this tragic fiasco is the fact that the PM has allowed Barrick to negotiate on its tax liability of K1.2 billion. Barrick has put that as a condition for reopening the mine and it seems Marape has been trapped into accepting this.
“The biggest piece of broad daylight deceit which we might have fallen victim to is the fact that this mine has been going full steam since 1989. All reserves were estimated to have been mined out by 2006 and the mine was kept open to mine the stockpiled low grade ore because of good gold prices. How does the Marape Government know that there will still be gold reserves left to mine when it buys out 100 percent of the mine in ten years?
“We might be buying a hole in the ground at commercial gold mine value.”
Under the guise of “Take Back PNG, Marape has sold us out.
“It will come back to haunt him and those who support his regime of slogans.”
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