Rio Tinto says its Bougainville mine is viable | Pacific Beat

Rio Tinto says its Bougainville mine is viable

Rio Tinto says its Bougainville mine is viable

Updated 30 April 2013, 16:24 AEST

The Rio-Tinto mine that sparked the civil war on Papua New Guinea's island of Bougainville is economically viable and could be re-opened in as little as 6 years.

Bougainville Copper, the Rio subsidiary that owns the mine lease, has just completed an order of magnitude study which shows the project is viable.

It is more than a decade since the war ended but sensitivities remain.

Jemima Garrett reports.

Presenter: Jemima Garrett

Speaker: Bougainville Copper's Managing Director, Peter Taylor, Former President, James Tanis

Keywords:re-opening Panguna mine

Bougainville Copper's Managing Director, Peter Taylor, has not set foot on the island since the war but has been working towards the re-opening of the mine.

The order of magnitude study released at the company's Annual General Meeting in Port Moresby is a first look at mine viability.

Even with commodity prices down, Mr Taylor is optimistic.

GARRETT: The mine has the potential to produce 170,000 tonnes of copper a year and half a million ounces of gold - putting it in the top ten gold and copper mines globally.

Start-up costs are estimated at around 5 billion dollars.

TAYLOR: I've estimated that it is about a six year project but that is on the basis of us getting access so we are not starting the clock now. It really depends on getting to the mine site and having a look what is there and confirming some of the assumptions we have made in that order of magnitude study.

GARRETT: More than 10,000 people died as a result of the civil war.

Bougainville went from being PNG's most prosperous province to a no-go zone with barely a school or a hospital operating.

Since the signing of the Peace Agreement in 2001 Bougainvilleans have been focussing on putting their lives and their economy back together.

That has prompted a reassessment of the value of Rio Tinto's mine at Panguna.

President John Momis is in favour of re-opening the mine and is preparing the way for detailed Bougainville wide discussions.

Former President, James Tanis, spent the war years fighting alongside rebel leader, Francis Ona.

TANIS: I come from a guerrilla army that fought against the Panguna mine but I have come to notice that there is already mining on Bougainville. After the conflict people now know the value of the stone under the ground. It has made me realise that mining is an industry that will be an important part of the Bougainville economy.

GARRETT:There is still a small minority of people who are strongly against re-opening of the Bougainville copper mine. How will you avoid bloodshed if there is a re-opening of the mine?

TANIS: I do believe we should re-open it but we have to be careful on how we follow the process, meaning that we have a small minority group and it is important that we listen to them, try to understand where they are coming from and come up with a solution that accommodates everybody.

GARRETT: Talking counts for a lot on Bougainville.

Bougainville Copper, MD Peter Taylor, says the negotiations to re-open the mine will not be rushed.

TAYLOR: What I have said to the Bougainville government and the landowners is I want them to set the agenda. I want them to tell me what it is that they want. So they will bring their agenda to the negotiating table and obviously we may have to compromise. But the different approach is going to be ..it won't be driven as it was in the first place by an Administration from Australia. It will be from day One negotiations between the people on the ground, the landowners in the mine site, the government of Bougainville and the other population of Bougainville.

GARRETT: Overseeing the negotiations will be the Board of Bougainville Copper which includes former Prime Minister Sir Rabbie Namaliu and its latest recruit, the widely respected former PNG community services Minister Dame Carol Kidu.

KIDU: As I am the first woman to go on there maybe I can bring some new perspectives. In terms of the corporate social responsibility I am very keen to get into that work later when it is appropriate.I am also interested to pursue the agendas of gender and social inclusion to ensure that, try to maximise any benefits and minimise the damage.

GARRETT: Conflict over mine revenue and environmental impacts fuelled the war on Bougainville.

James Tanis hopes modern mangement will make the difference.

TANIS: Panguna was negotiated in the 1960s when there was little knowledge on environmental issues mining brings. Technology has improved. Maybe with better technology, better environment policies and legislation, maybe we have a future with mining on Bougainville.

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