BOUGAINVILLE Copper shares surged on Monday on the back of rumours there could be a Papua New Guinea government “breakthrough” to help reopen the long-troubled Panguna copper-gold mine.
Panguna Copper Mine, Bougainville PNG
Panguna was the world’s fourth-largest copper mine in the months before it closed in 1989 and had produced 9 million ounces of gold and 3 million tonnes of copper from 1972.
While memories of the civil war which gripped Bougainville Island become more distant, rising copper prices have underpinned the complex effort to possibly redevelop and reopen the giant open cut mine.
On Monday, Bougainville Copper shares closed up 17%, while they have since closed down 3% to 91c yesterday after the Rio Tinto subsidiary’s replies to an ASX price query revealed it had no clue why its shares soared.
Yet Andorra-based European Shareholders of Bougainville Copper president Axel Sturm had some possible answers.
He told PNGIndustryNews.net there were unconfirmed rumours that the next Joint Supervisory Board and National Executive Council (PNG cabinet) meeting will take place on March 23-25 in Bougainville.
“It may deliver a breakthrough in re-opening the mine,” Sturm said.
“I think that there is very positive development backstage.”
The ESBC is also advocating that shareholders place put options on their Bougainville Copper shares at a high price of $A25-30 each for sale to help prevent “custody banks” from using them for “unauthorised lending to short sellers”.
The Frankfurt stock exchange has become the leading stock market for trading these shares and the preliminary Bougainville Copper annual report is expected next week.
A key and longstanding hurdle to reopening the Panguna mine is gathering the support of community landowners.
There were around 600 landowners or landowner representatives of the 1980 compensation agreement for the mine – providing plenty of scope for differences of opinion.
Rio Tinto owns around 54% of Bougainville Copper while the PNG government owns about 19%.
BOC Price at posting:
92.0¢ Sentiment: ST Buy Disclosure: Held
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