{"id":1181816,"date":"2020-05-01T08:58:03","date_gmt":"2020-05-01T13:58:03","guid":{"rendered":"https:\/\/www.mining.com\/?p=1022435"},"modified":"2020-05-01T08:58:03","modified_gmt":"2020-05-01T13:58:03","slug":"court-orders-png-to-negotiate-porgera-permit-with-barrick","status":"publish","type":"post","link":"https:\/\/juniorminingnews.com\/?p=1181816","title":{"rendered":"Court orders PNG to negotiate Porgera permit with Barrick"},"content":{"rendered":"<p>Barrick Gold (TSX: ABX) (NYSE: GOLD)&nbsp;welcomed Friday a court ruling ordering the government of Papua New Guinea (PNG) to review a requested lease extension for the Porgera gold mine.<\/p>\n<div class='d-flex justify-content-center d-xs-block d-sm-block d-md-none'>\n<div id='div-gpt-ad-1561499308230-0'><script>googletag.cmd.push(function() {googletag.display('div-gpt-ad-1561499308230-0');});<\/script><\/div>\n<\/div>\n<p>The world\u2019s second largest gold<br \/>\nproducer and its Chinese partner, Zijin Mining, <a href=\"https:\/\/www.mining.com\/papua-new-guinea-lashes-out-at-barrick-for-halting-porgera\/\">temporarily<br \/>\nhalted operations<\/a> at the mine in Enga Province last weekend, following Prime<br \/>\nMinister James Marape\u2019s <a href=\"https:\/\/www.mining.com\/papua-new-guinea-snatches-barrick-golds-porgera-mine\/\">decision<br \/>\nnot to renew Porgera\u2019s long-sought lease<\/a>.<\/p>\n<p>The government <a href=\"https:\/\/www.mining.com\/papua-new-guinea-lashes-out-at-barrick-for-halting-porgera\/\">hit back on Monday<\/a>, saying it would be \u201cforced\u201d to take immediate control of the mine if it remains closed during the transition period.<\/p>\n<figure class=\"wp-block-pullquote alignright\">\n<blockquote>\n<p>PNG&#8217;s National Court has ordered the parties to report on the progress of talks before returning to court on May 8.<\/p>\n<\/blockquote>\n<\/figure>\n<p>State-owned Zijin followed suit. It<br \/>\nsaid that if PNG didn\u2019t conduct negotiations to extend the mining lease in good<br \/>\nfaith, the issue <a href=\"https:\/\/www.mining.com\/web\/zijin-warns-papua-new-guinea-of-china-anger-over-end-of-gold-mine-lease\/\">could<br \/>\nimpair the country\u2019s relations with China<\/a>.<\/p>\n<p>The National Court\u2019s order calls PNG<br \/>\nand Barrick to negotiate before returning to court in a week on May 8, to<br \/>\nreport on the progress of talks, local <a href=\"https:\/\/postcourier.com.pg\/court-orders-state-and-barrick-to-talk\/\">Post-Courier<br \/>\nreported<\/a>.<\/p>\n<p>It also instructed Barrick Niugini<br \/>\nLimited (BNL), the manager of Porgera, to maintain the mine infrastructure and<br \/>\nassets during negotiations.<\/p>\n<p>If talks fail,&nbsp;BNL said, the<br \/>\ncourt would appoint an accredited mediator to facilitate dialogue between the<br \/>\nparties.<\/p>\n<p>Barrick and Zijin had applied in<br \/>\nJune 2017 for a 20-year renewal of the Porgera\u2019s lease, which expired in<br \/>\nAugust.<\/p>\n<p>Since then, the company has<br \/>\nfaced&nbsp;<a href=\"https:\/\/www.mining.com\/barrick-meets-new-png-leader-porgera-mine-lease-extension\/\"  rel=\"noreferrer noopener\">backlash from landowners and residents<\/a>&nbsp;over what they<br \/>\nclaim are negative social, environmental and economic impacts from the mine.<\/p>\n<p>Negotiations with Porgera\u2019s<br \/>\noperators were complicated further by a split among the landowners.<\/p>\n<h2><strong>Tier One Potential<\/strong><\/h2>\n<p>Barrick\u2019s president and chief<br \/>\nexecutive officer, Mark Bristow, in March that&nbsp;<a href=\"https:\/\/www.mining.com\/barrick-unveils-10-year-plan-to-become-worlds-most-valued-gold-miner\/\"  rel=\"noreferrer noopener\">Porgera had \u201ctier one potential\u201d<\/a>&nbsp;but faced many<br \/>\nchallenges in the form of \u201clegacy issues and an unruly neighbourhood.\u201d<\/p>\n<p>The gold mine, located in PNG\u2019s<br \/>\nnorthern highlands region, is a joint venture between Barrick and Zijin Mining.<br \/>\nEach own 47.5% of the mine, with the remaining 5% held by landowner group<br \/>\nMineral Resources Enga.<\/p>\n<p>Porgera contributes to about 10% of the nation\u2019s exports and employs over 3,300 Papua New Guinea nationals.<\/p>\n<p>The open pit and underground gold<br \/>\nmine sits at an altitude of 2,200-2,600 metres in Enga province, and is about<br \/>\n600 km (370 miles) northwest of Port Moresby.<\/p>\n<figure class=\"wp-block-pullquote alignright\">\n<blockquote>\n<p>Porgera contributes to about 10% of the nation\u2019s exports and employs over 3,300 Papua New Guinea nationals.<\/p>\n<\/blockquote>\n<\/figure>\n<p>\u201cWe don\u2019t have many details on the<br \/>\nimplications of this decision yet, including the timing of the transition,\u201d<br \/>\nJackie Przybylowski of BMO Capital Markets said late April in a research note.<\/p>\n<p>\u201cBarrick has warned that it will<br \/>\npursue all legal avenues to challenge the government\u2019s decision and to recover<br \/>\nany damages. We expect that discretionary spending, such as development capex,<br \/>\nwill be minimized through the current period of uncertainty,\u201d Przybylowski<br \/>\nnoted.<\/p>\n<p>The mining analyst also said that<br \/>\n\u201cwhile removing Porgera from Barrick\u2019s portfolio would have a negative<br \/>\nfinancial impact, it would improve the ESG performance of the company\u2019s<br \/>\nportfolio going forward.\u201d<\/p>\n<p>\u201cOn its website, Barrick reports<br \/>\nallegations of human rights violations in the region,\u201d she pointed out,<br \/>\n\u201cincluding allegations of \u2018extreme\u2019 violence linked to local police forces or<br \/>\nprivate security forces acting on behalf of the joint venture.\u201d<\/p>\n<p>Other mining companies operating in<br \/>\nPNG, including Australia\u2019s Newcrest (ASX: NCM), have not been impacted by the<br \/>\ndecision regarding Porgera.<\/p>\n<p>The miner has \u201cwelcomed\u201d the Prime Minister\u2019s<br \/>\nsupport&nbsp;for its&nbsp;<a href=\"https:\/\/www.mining.com\/newcrest-harmony-gold-to-resume-permitting-talks-for-png-project\/\"  rel=\"noreferrer noopener\">Wafi Golpu gold and copper asset<\/a>,&nbsp;adding that its<br \/>\nspecial mining lease at the Lihir operations remains in good standing with a<br \/>\nlease renewal not expected until 2035.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>National Court has ordered the parties to report on the progress of talks before returning to court on May 8.<\/p>\n","protected":false},"author":8,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"site-sidebar-layout":"default","site-content-layout":"","ast-site-content-layout":"","site-content-style":"default","site-sidebar-style":"default","ast-global-header-display":"","ast-banner-title-visibility":"","ast-main-header-display":"","ast-hfb-above-header-display":"","ast-hfb-below-header-display":"","ast-hfb-mobile-header-display":"","site-post-title":"","ast-breadcrumbs-content":"","ast-featured-img":"","footer-sml-layout":"","theme-transparent-header-meta":"","adv-header-id-meta":"","stick-header-meta":"","header-above-stick-meta":"","header-main-stick-meta":"","header-below-stick-meta":"","astra-migrate-meta-layouts":"default","ast-page-background-enabled":"default","ast-page-background-meta":{"desktop":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center 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