IN THE wash up of recent speculation surrounding the re-opening of Bougainville Copper's sizeable Panguna copper-gold operation, PNGIndustryNews.net spoke with company chairman Peter Taylor to find out if the mine is any closer to reopening.
When the news broke earlier this month that PNG Mines Minister Sam Akoitai was meeting with Rio Tinto heads in London, ambitious day traders embarked on a buying frenzy on the Australian Stock Exchange, sending the stock upwards by almost 50% to cross the $A1 mark for the first time in almost a year.
What followed was a raft of speculation, in both the press and obviously in the market, that Bougainville Copper was looking to re-open the massive Panguna mine that has been closed since 1989.
However, Taylor told PNGIndustryNews.net reports of Panguna being the topic of discussions in London were unfounded and indicated the future of both Panguna and Bougainville Copper remained shrouded in uncertainty.
"Despite what the media said, the meeting wasn't about Bougainville Copper or the opening mine – it was [about] the Mines Minister coming back from his annual promotional tour to Canada and he asked to stop by Rio and tell them what a great place PNG was to invest in the mining industry," he said.
"Somebody has obviously embellished the story as it has gone along and decided that it must mean mining but mining wasn't even discussed. That is logical when you consider that it is not Rio Tinto that is going to make the decisions anyway – it is Bougainville Copper."
When asked if any progress on Panguna had been made following Akoitai's London meeting, Taylor said "as far as I know there has been no change".
However, he did reveal a lifting of the exploration moratorium on the island of Bougainville is due to be considered.
"My understanding is that the National Executive Council has approved the consideration of lifting the moratorium on exploration on Bougainville, generally.
"But that process hasn't started yet – they have merely made the decision. Whether Bougainville Copper will be invited to that process or not, I am not sure."
Taylor also said a review of the Bougainville Copper agreement is also scheduled.
"The NEC has also authorised a review of the Bougainville Copper agreement – the agreement is enshrined in legislation so they have to review it," he said.
"The agreement itself calls for a review every seven years but the review has never taken place – the last one was due just before mining was suspended in 1989. They were gearing up for it but it just didn't take place.
"It hasn't been possible to a review since then mainly because there hasn't been a Bougainville government [representative]. Now there is, it was the Mines Minister who put the proposal forward. As I understand it, it has been accepted by the NEC but so far there has been no meeting.
"It is going to be a pretty long process so any talk about anything happening in the short term is just not right."
Taylor hesitated to speculate on the future of any mining operation on Bougainville.
"At this stage, we are not even sure what the mining regime will look like because Bougainville and the National government have got to decide between them which one of them is going to be responsible in the longer term for mining and what the regime is going to be," he said.
Taylor said under the Bougainville provincial constitution, Bougainville has the right to take over mining-related matters "when they show the capacity to handle it". He said there was a possibility that a new mining regime may even rule out any sort of mining and exploration activity on the island.
"Obviously when that is worked out, Bougainville Copper has then got to look at what the result of all those things are, for example, whether the Bougainville Government decides it is going to allow mining and exploration at all in Bougainville. It has got to decide that and if so, what the rules are and whether Bougainville Copper is welcome to be a part of that or not be part of it," he said.
"Armed with all of that information, Bougainville Copper needs to start making some decisions about what it wants to do itself."
When asked whether there was a possibility of Bougainville Copper being stripped of the Panguna asset by the new Autonomous Government, Taylor remained positive that rights given to the company under the agreement would be upheld.
"That shouldn't happen. The Bougainville Copper agreement gives certain rights to Bougainville Copper, including the rights to have those leases renewed. So there shouldn't really be a question whether Bougainville Copper has got a right to those assets.
"But whether it [Bougainville Copper] decides in the interests of shareholders it is better off selling those assets to a third party, or not, is something we will have to decide."
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