PNG seeks control of projects as Harmony/Newcrest wait on Wafi-Golpu mining lease

Wafi Golpu

PAPUA New Guinea president, James Marape, upped his administration’s strong take on resource nationalism saying the country must be resilient as it negotiated with mining and petrochemical investors.

“We are on the right course and the journey that we are taking will not be easy,” Bloomberg News citing Marape to have said in a statement before parliament on Wednesday. “But we must remain united and resilient in this course, because PNG will be a winner in all aspects,” he said.

Marape swept to power in 2019 on a pledge to “take back” PNG from multinational energy and mining companies, which are by far the biggest investors in the impoverished South Pacific nation of 9 million, said Bloomberg News.

Marape’s have special relevance for Harmony Gold and Newcrest Mining which are yet to finalise a special mining lease (SML) for their Wafi-Golpu gold/copper joint venture. The extent of PNG government investment is unknown but it could amount to control based on Marape’s hardline approach.

Guidelines provided by Marape is that the state must take a 60% to 65% share of revenue from future projects, up from just 40% on recent petroleum ventures.

His government also wants to see the financial benefits flow through to the state coffers quicker, and for developers to commit to using local labor, goods and services in their operations wherever possible, said Bloomberg News.

Wafi-Golpu is an enormous greenfields project that Harmony and Newcrest have been trying to get on the road for years.

“There is disappointment that we took so long to get where we are,” Harmony Gold CEO, Peter Steenkamp, told Miningmx in July.

“We started with the application in 2016 and we’re in 2020 and we still don’t have an SML … At the moment we are not able to travel to PNG, so we can’t have face-to-face meetings. But I must say, we are very encouraged with the public statements from the prime minister about the project so, hopefully, we should see some good traction,” he said.

Harmony is due to report interim numbers on September 15.

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