PNG Prime Minister James Marape has announced the reopening of the Enga Province Porgera gold mine as of December 22 as the New Porgera mine.
The mine will reopen under a new special mining licence, with first gold expected to be produced in the first quarter of 2024.
“I welcome the reopening of Porgera this year,” Marape said.
“It has been a long road we have travelled to the reopening of Porgera mine, but it has been worth the effort.”
Marape said the reopening is the result of a partnership between PNG and two leading global mining companies – Barrick Gold Corporation and Zijin Mining Group.
“For the first time, such an agreement has given a majority ownership in a major resource project to Papua New Guinean shareholders.”
“New Porgera is a fine example for mining companies demonstrating that they can still make money in the new benefit-sharing arrangement we have carved out with Barrick.”
Under renegotiated arrangements set after the mine closed in 2020 due to the loss of its previous mining license, PNG stakeholders will retain a 51 per cent ownership over New Porgera.
The stakeholders include PNG via its mining company Kumul Minerals Holdings Limited, the Enga Provincial Government, and local landowners.
Barrick Gold Corporation and Zijin Mining Group together will maintain a 49 per cent share.
“New Porgera will deliver unprecedented benefits to the people of Papua New Guinea,” Marape said.
“The three per cent royalty to landowners is part of these benefits so landowners are big winners with 15 per cent equity as they are getting 18 per cent harvest value of gold from first production.
“At an assumed gold price of $US1,800 per ounce, PNG shareholders can expect to receive nearly $US7.3 billion (approximately K27.6 billion) over 20 years and $US2.8 billion (K10.6 billion) in the first ten years.”
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