PNG landowners hope to stymie Barrick’s restart of Porgera gold mine

The Porgera Landowners Association (PLOA) members are working on an injunction to impede the restart of the Porgera gold mine in Papua New Guinea.

The operator, Barrick Gold (TSX: ABX; NYSE: GOLD), and its Chinese partner, Zijin Mining, became embroiled in a dispute with the PNG government in April 2020, when Prime Minister James Marape rejected their 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. Barrick and Zijin agreed to halve their stakes. New Porgera, as the mine is now called, is 51% owned by PNG stakeholders, including local landowners and the Enga provincial government.

The government of Papua New Guinea, Barrick Niugini Limited and New Porgera Limited signed an agreement in March to progress towards resumption of operations at the mine.

Members of the PLOA, however, say they did not participate in the negotiations and that Barrick and other stakeholders should have involved them in a discussion forum before making decisions about the restart.

“We did not sign anything,” Nixon Mangape, one of the traditional landowners and former National Parliament of PNG member said.

Mangape said he served Barrick with a no trespass notice on Apr. 20.

“I was born and raised there. No compensation or resettlement agreement was signed with landowners,” Mangape said. “No major contracts were given to us for 30 years. We became spectators in our own land.”

“The landowners have simply said they have had enough, they want their land back and Barrick gone, where there is no remedy available other than to return the land back to its lawful owners and pay for the damage they have caused,” he said.    

He added that the PLOA has drafted a court injunction they plan to submit if they are not involved in negotiations.

The Porgera mine 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.

Barrick said in a statement that the agreement signed in March does not change the right of landowners to participate in New Porgera Limited under the Porgera Project Commencement Agreement (PPCA) or otherwise change their rights at law.

“The New Porgera Progress Agreement recorded the recommitment of the parties to reopening the mine on the terms agreed in the PPCA, which will be to the benefit of all stakeholders including landowners,” said the company.

“Under the PPCA, all parties agreed that Barrick Niugini was to remain in possession of the Porgera mine site and would continue to maintain the mine on a care and maintenance basis until ‘New Porgera’ commences. Mr. Nixon Mangape personally signed the PPCA on behalf of MRE, and any suggestion that we are trespassing on the land is simply wrong and inconsistent with the PPCA.”