President John Momis has called for the Prime Minister O’Neill and the global mining giant , Rio Tinto, to reveal any dealings between PNG and Rio Tinto in Rio Tinto’s shares in Bougainville Copper Ltd (BCL).
Rio Tinto is the majority shareholder in BCL, with 53 per cent equity. In August 2014, Rio Tinto announced a review of its investment in BCL.
The President said:
“For over a year now, Prime Minister O’Neill has expressed interest in the National Government taking control of BCL. He proposes that PNG operate the Panguna mine in Bougainville in the same way it operates the Ok Tedi mine. The Prime Minister expressed that view to me early in 2014, and to members of the Bougainville group known as the Me’ekamui Government of Unity.
“In 2014 I made two strong statements against the Prime Minister’s proposal, the most recent dated 11 December. In that statement, and in a letter to the Prime Minister of 11 December, I made it clear that all decisions about mining in Bougainville must be made by the Autonomous Bougainville Government. I also spelt out that it would be completely unacceptable to Bougainvilleans for the National Government operate the Panguna mine.
“The Prime Minister replied in a letter dated January, but not received by me till late March. Amongst other things he said the National Government had no intention of taking control of the Panguna Mine.
“But as yet unconfirmed information available to me indicates that the National Government may be planning to purchase the Rio Tinto 53 per cent share in BCL. The National Government has always held 19.3 per cent of the BCL shares, and so if it takes Rio’s shares it would own over 72 of the equity.
“On 20th March, I wrote to BCL, seeking advice from either BCL or Rio Tinto, about the whether such share transactions between Rio and PNG were under discussion or preparation. I received a brief reply from Rio, addressed to BCL but passed on to me, dated 23 March.
The letter simply stated that ‘Rio Tinto … was reviewing its options with respect to its stake in Bougainville Copper Limited. This review is continuing.’
“The Autonomous Bougainville Government (ABG) has been deeply concerned at the possibility that Rio and PNG might be contemplating trading shares in BCL. The only valuable asset that BCL has is its limited rights over minerals at Panguna. Trading in Bougainville’s minerals between Rio and the Australian colonial Administration occurred in the 1960s, without any reference to Bougainville. We cannot allow a new form of colonial dealings in Bougainville’s resources to occur.
“Secret dealings of this kind are completely unacceptable to the people of Bougainville and so the ABG. It would be equally unacceptable to the people of Bougainville for the National Government to try to take control of Panguna. As I said in my public statement in December: ‘Any attempt by the National Government to control mining in Bougainville could cause Bougainvilleans to lose all faith in the BPA (Bougainville Peace Agreement). Many would refuse to work with the National Government any more. They would want immediate independence. It would be a recipe for undermining, perhaps even destroying, support for the BPA.’
President Momis said that as a result of the gravely serious issues involved, he was now calling on both the Prime Minister and Rio Tinto to clarify the position: ‘They must state publicly and clearly whether or not either of them is planning, or is in any way involved, in preparing for or conducting, any transaction involving transfer of Rio Tinto’s shares in BCL, either to the PNG Government or to any entity controlled by or involving PNG’.
The President also said that as a result of ABG mining laws passed in August 2014 and March 2015, the only legal right BCL has in Bougainville is an exploration licence over the former Special Mining Lease at Panguna. He said:
“That exploration licence is intended to put BCL in the same position as any exploration licence holder that has completed exploration, and wants to apply for an negotiate about possible grant of a mining licence. It gives BCL a right to negotiate the conditions on which it might be allowed to resume mining, but only if it gets permission from both customary landowners and the ABG.
“It is normal for mining laws to allow withdrawal of an exploration licence if there are any commercial dealings in the licence in the first two years after it is granted. In passing the Bougainville Mining Act 2015 in March, the ABG House of Representatives amended section 112 of the Act to make it clear that dealings in more than 25 per cent of the shares in any company holding an exploration licence will also allow withdrawal of the licence.
“Both Rio Tinto and the Prime Minister need to be aware that transfer of Rio’s shares in BCL in the two years since BCL’s exploration licence came into operation, in August 2014, will result in action to withdraw that licence. In the meantime, I call on them to clarify the issues I am raising in this statement”
Chief John. L. Momis
Nations that give aiding grants to Pacific Island countries are those that influence a lot of decisions made by leaders in the Pacific. This was stated by secretary-general of the Pacific Islands Forum Secretariat Dame Meg Taylor as the finding of the review of the Pacific Plan that was conducted by former Papua New Guinea Prime Minister Sir Mekere Morauta. “One of the key issues that Sir Mekere has reiterated is who makes the decision for what happens in this region and then who takes on the responsibility. And then in his conduct of the review, it was very clear to him that a lot of the decisions that are made in this region are not made by our leaders,” Dame Taylor said. “And it's those who bring a lot of funds into the region determine how things happen and he wanted to see a shift in the development paradigm and that the leaders take those responsibilities.” She added this may sound simplistic. “But it's quite revolutionary in the way you do it but other parts of the world have taken this on setting the agenda on themselves and they have worked closely with multi-national banks and bilateral banks and have really shifted the way developments happen in their own region and this is at the very heart of it,” Dame Taylor said. She said this was also a reason the PIFS had put together the framework for Pacific regionalism to succeed the Pacific Plan.
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