Barrick prepares to restart Porgera gold mine in PNG
Barrick Gold (TSX: ABX; NYSE: GOLD) plans to restart operations at the Porgera gold mine in Papua New Guinea (PNG) later this year, according to CEO Mark Bristow, while an Indigenous group alleges its rights are being ignored in the mine restart process.
Porgera, located in the central province of Enga was placed on care and maintenance in April 2020 following a dispute over benefit sharing terms between the government, local people and Barrick, as part of renewing the mining lease.
New Porgera, as the mine is now called, is 51% owned by PNG stakeholders, including local landowners and the Enga provincial government. It hosts an orebody with measured and indicated resources of 10 million ounces and inferred resources of 3.4 million ounces of gold.
It produced about 600,000 ounces of gold in 2019 before being put on care and maintenance.
After the initial ramp up and optimization of the Wangima pit, Porgera is forecast to produce an average of 700,000 ounces per year.
The mobile fleet and fixed plant are being re-commissioned, the mining and metallurgy plans updated and the personnel recruitment plan finalized in preparation for the restart, Bristow said in a news release on Friday.
“It’s been a long journey but in the process we have secured the buy-in of all the stakeholders,” he added. “For Barrick, the re-opening of the mine represents another victory for our host country partnership model which has been so successful in Tanzania and has also been adopted for the Reko Diq project in Pakistan.”
Ongoing land dispute
However, the Porgera Landowners Association (PLOA) stated in a July 28 letter to the country’s Mineral Resources Authority (MRA) that it strongly objects to a special mining lease application put forward by New Porgera.
In the letter, posted on the group’s Facebook page on Tuesday, the PLOA says that while it supports the mine’s restart, it feels the process for restarting it has ignored its concerns.
The association says it wasn’t consulted about the New Porgera Mine Development Forum scheduled to be held at a teachers college in Enga Province from Aug. 7 to Sept. 7. The group says the location will leave attendees vulnerable to violence and that the absence of independent observers will mean Indigenous benefits will be “hijacked” by political leaders at the forum.
The letter goes on to say that the proponents of New Porgera as well as the government agencies haven’t involved the PLOA in discussions on a compensation agreement on mining operations, and that the company is “absolutely prohibited” from entering its land until an agreement is signed.
PLOA’s letter comes just almost four months after the group tried to block Porgera’s restart because it alleged it wasn’t included in negotiations between the PNG government and Barrick over the project.
Those talks were aimed at resolving the dispute in 2020, when Prime Minister James Marape rejected Barrick’s application for a lease extension.
Barrick had faced backlash from landowners and residents over what they claim are negative social, environmental and economic impacts from the mine.
The standoff was resolved in April 2021 through two deals, which gave the PNG government a majority stake in Porgera.
