AAP - CHINA'S MINERAL hunger could see it take a bite into the massive Bougainville gold and copper mine that has been dormant ever since a decade-long civil war with Papua New Guinea
So far, China's mining pursuits in PNG have been a disaster and Bougainville remains hostile to outsiders.
China's Metallurgical Group Corporation's billion dollar investment in the Ramu nickel mine in PNG's Madang Province has been beset with lengthy court cases, protests, violence and endless difficulties with government departments.
And now, Bougainville President John Momis says China has expressed interest in a potential role in reopening Bougainville's Panguna gold and copper mine.
Rio Tinto, which has a 53 percent stake in Panguna mine owner Bougainville Copper Limited describes China as one of its most important partners.
China's state-owned aluminium company Chinalco currently has a 12 percent interest in Rio Tinto.
Rio declined to comment over possible arrangements for reopening the mine but Mr Momis told AAP there had to be a "paradigm shift" in approaching Panguna.
"We're open to discussion to make sure we get the best and most equitable deal," he said.
One theory, according to Mr Momis - who is the former PNG ambassador to China - is the Chinese could pay for the mine's estimated $4 billion cost to reopen in exchange for an equity stake.
"We are cash strapped as a government, and we are putting this to potential partners that we would be very keen to have some upfront payment even before the deal for the mine is negotiated," he said.
"The Chinese have expressed an interest in the mine, but we are keeping all our options open."
Speculation of Chinese interest in Panguna was sparked after news that former Australian prime minister Bob Hawke met with "old friends" PNG prime minister Sir Michael Somare and Mr Momis, in Port Moresby in late November.
Mr Hawke is active in business relations with China and sits on Fortescue Metals Group's China Advisory Board. His consultancy, Robert JL Hawke and Associates, has a Shanghai office.
However, both Mr Hawke and Mr Momis said no specific Chinese interest was being positioned for Panguna.
Mr Hawke, a 'chief' in PNG after he was awarded the Grand Companion of the Order of Logohu in 2008, the highest honour available to non-PNG citizens, told AAP the recent meeting covered many items.
"A whole range of things were discussed and in the course of the discussion there was reference to Bougainville," he said.
"There was talk about reopening of Panguna but I can categorically deny I am representing Chinese-state interests.
"Of course, there is an economical and political interest in Bougainville's future, but to say I was representing China is utter crap."
Mr Hawke said he was in PNG working for a Korean company on unrelated matters.
Mr Momis, who has repeatedly asked the PNG government to fulfil the agreement to transfer its 19 per cent mine shareholding to the Bougainville government, said no undertaking had been made to China.
"Mr Hawke did say it was important to keep the China option open but there was no agenda being pushed," he said.
"We discussed the possibility of reopening the mine. We talked about China and other companies including Rio Tinto."
Landowner groups recently met to discuss reopening central Bougainville's controversial Panguna mine, but the memory of the guerilla war that claimed an estimated 20,000 lives from fighting and disease from 1987 to 1997 still looms large.
Despite talk the mine could reopen as early as December 2011, there are numerous hurdles relating to a series of complex negotiations and the ongoing peace and reconciliation program.
While the original conflict encompassed many divergent politics, the main problem stemmed from anger over the mine's massive revenue going to Australian-owned Bougainville Copper Limited and the PNG government, which at peak rate was about a quarter of PNG's GDP.
The Australian government supported PNG's inept efforts to quash the secessionist insurrection that was also sparked by local rage over the mine causing widespread environmental destruction.
The conflict dissipated when PNG military senior ranks learnt then-prime minister Julius Chan spent tens of millions of dollars hiring mercenaries led by British military man Tim Spicer.
A subsequent PNG military mutiny along with riots in the capital Port Moresby pushed the country to the brink of a coup, in what is now known as 1997's Sandline Crisis.
So now with all this behind them, the economic stability required for Bougainville's Independence referendum - scheduled for 2015 - is seen to be locked in Panguna.
Despite hostility Bougainville Copper Limited has remained in PNG slowly chipping away with gentle efforts to reopen the mine that still contains millions of tonnes of gold and copper.
Only time will tell how Panguna, this sleeping dragon of the Pacific, will awake.
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