Papua New Guinea“Gold & Copper Elephant Country” By Ken Reser...

Papua New Guinea
“Gold & Copper Elephant Country”


By Ken Reser Printer Friendly Version
October 3, 2005


"Is There Another Elephant On The Island"

Papua New Guinea (PNG) a nation the size of California has one of the most heterogeneous indigenous populations in the world. With several thousand different communities and villages, most of which boast small populations of only a few hundred souls, this country has truly suffered isolation from lack of roads and infrastructure. Tribal warfare in this land of isolation and mountainous jungle terrain has been ongoing for millennia.
It is said that there exist more than 750 different languages, and for each village a different culture. Strange as it may seem over two thirds of this nations populous are practicing Christians. These are a people similar to indigenous peoples everywhere throughout the world, in that they have very strong attachments and bonds to the land. This must be understood by mining companies and is tantamount to their success.

The main central city of Port Moresby is the nation's capital and boasts the largest population of approximately 320,000 people. The next smaller cities of Lae (90,000) and Mt Hagen (70,000) are among the only other large centers of population. It should be noted that PNG is a democracy of multi parties, modeled after the British parliamentary system of government. While it may be said that the indigenous people of this nation depend largely on subsistence farming and most are not yet given over to the decadence of the modern world, they were given mineral riches far beyond the scope and size of this tiny nation. Much to my amazement I found in my research that PNG was ranked in 2003 as the 11th largest producer of Gold in the world.

PNG ranks ahead of such countries as Brazil, W Africa, Indonesia, Chile & the Philippines in Gold and Copper. This is truly a part of the world rich in mineral wealth and discoveries yet to be revealed.

Geologically PNG is situated directly on the Pacific Ring of Fire and thus has seen a profusion of epithermal and mesothermal alterations over millions of years. The Islands of PNG and Indonesia were primarily formed by volcanic activity and thus have enriched the earth's crust with major deposits of primary and intrusive secondary type enrichment mineralization of Copper & Gold.

From the mountainous peaks of the Grasberg Mine on Irian Jaya, the eastern portion of the Island, (52 M Oz Au, 12 Mt Cu) to the depths of OK Tedi's open pit (10 M Oz Au, 3 Mt Cu), Panguna (16 M Oz Au, 5 Mt Cu), Frieda, (9 M Oz Au, 5 Mt Cu) to RTZ's Lihir (45 M Oz Au), PDG's Porgera on the Island of Bougainville(26 M Oz Au), Harmony's Morobe (5-10 M Oz Au) this is a land of tremendous tapped and as yet untapped Gold & Copper deposits. The aforementioned mines are only a few of the largest mines currently in production. The list is growing and PNG will no doubt soon garner world attention again as there is a strong current upswing in junior mining exploration activities today as well as with the majors having a previous foothold and extensive mineral properties in production.

Recently, new exploration work in PNG has turned its attention to the deep sulfide enriched & hosted Gold & Copper deposits, and it is to this end that the renewed exploration has begun to occur, albeit as yet unnoticed by most mining media. Personally I think this new scenario will soon be very conspicuous and we will see a very notable amount of attention by the mining writers and pundits given over to Papua New Guinea and new discoveries made, along with some older previously known deposits being re-evaluated.

Unlike the past where mining companies came into countries like PNG and explored, exploited and operated mines irrespective of the rights and wishes of local indigenous peoples, today these rights and wishes are being acknowledged by major miners & Jr exploration companies and the landowners must be paid royalties by companies operating in areas affected by mining. Today local peoples are now trained for employment in exploration and development of mines.

After many years of little or no exploration, Papua New Guinea is again coming to life. Not to take a back seat to the extensive Oil and Gas exploration now evolving and growing in PNG, the mining sector, having been revitalized with new and recent regulatory mining law changes as well as tax reforms, is about to return to it's task of drilling mother earth in search of her treasures.

We all know and realize that current Gold production is losing ground with respect to demand (up 42% in Q2 /05) and past production. With Gold reaching new and ever higher prices and Copper at an all time high in value and demand, Papua New Guinea stands in the limelight of potential areas for major exploration work and new discoveries to be made.

In the words of a former exploration manager of Placer Pacific's Greg Hall, "Papua New Guinea is one of the most enriched Copper & Gold sections of the earth's crust"... and in my words ... "I think he's right" now let's see if another elephant can be found on the island.

Thanks for reading.

Ken J. Reser
Independent Investor Relations & Reasearch Consultant.