Economy. Papua New Guinea press review

The Chamber of Mines and Petroleum of Papua New Guinea (PNG) has said the current national government is leaning towards public investment in the mining sector. President of the Chamber, Gerea Aopi, said the PNG Government has signaled that it favours public investment in the mining sector at the expense of private investment, according to the amendments to the Mining Act, introduced in Parliament last week, and statements related to their introduction, will cause private sector explorers and foreign investors to reconsider investment plans for PNG.
«PNG’s development of world-class mining industry has required billions of Kina in private investment over the last 40 years […] The latest amendments to the Mining Act diminish the role of foreign and local private sector investors with privileges accorded to Kumul Minerals or other state-owned entities, » President of the PNG Chamber of Mines and Petroleum. Mr. Aopi explained that exploration for, and development of, mining resources requires large amounts of capital, while facing significant social, technical and economic challenges. Having State-owned entities shoulder the burden of exploring and developing PNG’s mining potential will shift the burden of risk from private investors to the PNG taxpayers, and will stymie the entrepreneurial nature of these activities. «The Act states that “any person” may apply to the Mineral Resources Authority for an Exploration Licence and, on making a viable discovery, submit a Development Application. […] That is why there are a healthy number of Papua New Guinean exploration licence holders now, doing expensive and time-consuming work to discover mineral resources, » Mr. Aopi said. [1-3]

According to the PNG Mineral Resource Authority (MRA), the passing of the Mining Amendment Bill 2020 will not stop exploration nor chase away investors. MRA Managing Director Jerry Garry says that MRA «do not see any deterrence or severe detriment to exploration in the amendments». «Where the amendment deals with state application to participate in mining and mineral exploration, clearly spells out very specific conditions, after mineral tenements are expired, cancelled or surrendered […] This does mean every tenement holder who has been compliant with all its statutory and mandatory obligations or conditions satisfactorily over a term does not need to worry about losing their tenement […] The normal assessment and MAC [Mining Advisory Council] process will protect the tenement holder, » Mr. Garry said. MRA Managing Director also noted that the mining and petroleum sector contributed 86% of total exports of the country. «From that total export, the State revenue is only seven per cent. Furthermore, preliminary assessment by OECD [Organisation for Economic Co-operation and Development] revealed the tax to GDP ratio in PNG was very low at 13,7%, well below by 20%when compared to average OECD member countries,» Mr. Garry says and also added that legislation was drafted on the instruction of the PNG Government. [4]

Assessment on the Frieda River copper-gold project in West Sepik Province is likely to continue after the granting of the Wafi-Golpu special mining lease (SML), according to Mineral Resources Authority (MRA). According to MRA Managing Director, COVID-19 had affected the assessment schedule for the Frieda River project. Mr. Garry said that the proposal for development and SML 9 application (amended) were lodged by the developer, PanAust Ltd, with the MRA in December 2018 for the development of the Frieda River project.
The Frieda River project consists of four components:
• Frieda River Copper-Gold Project;
• Frieda River Hydroelectric Project;
• Sepik Infrastructure Project;
• Sepik Power Grid Project. [5]

Prime Minister of Papua New Guinea Hon. James Marape and PNG Mining Minister Johnson Tuke visited Lae (Morobe Province) to discuss the Wafi-Golpu project with landowners and the provincial government: «We will have a meeting before the government and state negotiating team start the negotiating with Harmony and Newcrest as far as the Wafi-Golpu project is concerned, » Mr. Marape said. According to PNG Prime Minister, the Government wanted to move forward the Wafi-Golpu, Porgera, P’nyang and Pasca projects by the third quarter of the year. Hon. James Marape also noted that he wanted to open up the country for business despite the threat of the coronavirus globally: «The COVID-19 must not kill the country’s economy and the Government’s service delivery to our people. Under the National Pandemic Act, localised control based on medical evidence will be exercised but people’s livelihood, commerce and trade must continue». [6-7]

The PNG Government’s decision to modernise the two international terminals owned by PNG Ports Corporation Ltd had achieved results over the last three years In September 2017, PNG Ports and the Government signed a 25-year terminal management agreement with the International Container Terminal Services Inc (ICTSI) South Pacific to manage and operate its Lae port and Motukea international terminal. «The Government has planned for continued growth and development in the international trade arena and PNG Ports is pleased to have entered a productive partnership with ICTSI […] We look towards enhancing our partnership over the next two decades as we work together to maximise both ports’ potential of bringing high standards of operational efficiency to the two ports for the greater benefit of our port users and the country, » PNG Ports Managing Director Fego Kiniafa said. PNG Ports said, in a statement, that statistics showed vessels waiting at anchor to berth at port facilities was hourly, compared to the 2015 average waiting time of 16 hours, while the time spent in port while cargo was being off loaded and loaded had been reduced from at least two days on average to less than a day. It was also noted that electronic data interchange and vessel productivity reports which used to take about 12 hours now took around two hours. [8]

At the same time, Information Communication Technology Minister of Papua New Guinea Timothy Masiu is open to new mobile network operators in the country to encourage competition in the telecommunications industry. Mr Masiu said this when asked about the third mobile network to be rolled out by Digitec Communications Ltd, which would be rolled out soon. «We need to bring in one or two more mobile network operators to make competition easier and also let people to choose which company they want to use for communication […] Once they come in, it should be really good and healthy for business for the country’s telecommunications industry in the country, » Mr Masiu said. [9] [1]
Read more news of the Miklouho-Maclay Foundation: