PNG gov’t boosts stake in Porgera

The Porgera joint venture, in which Placer Dome (TSE) is a partner, has agreed to sell to the government of Papua New Guinea an additional 15% interest in the Porgera gold mine.

The three partners in the joint venture will each contribute a 5% interest. The purchase price for the 15% equity is about US$136 million, payable to the joint venture partners out of the state’s share of future after-tax proceeds from the mine.

Placer’s indirect interest in the project will be reduced to 18.9%. The sale is expected to reduce the company’s 1993 share of gold production from the operation by about 35,000 oz.

At the end of 1991, reserves at Porgera stood at 17 million tons grading 0.193 oz. gold per ton.