THE board of Petromin Holdings Ltd is seriously considering closing down its Tolukuma gold mine in Central as attempts to bring in a credible partner were unsuccessful.
Chairman Sir Brown Bai said the mine’s high operating costs and a continuous subdued gold price have been a challenge for the mine and Petromin to continue with the operation and sustain the cash support required.
The mine is located in the Goilala district of Central, 100km north of Port Moresby and can only be accessed by helicopter.
Following a board meeting last Thursday, Sir Brown said: “Petromin has been losing money funding Tolukuma for the last four years
and with falling gold prices, Petromin can no longer sustain Tolukuma.
“Other companies within the industry have been affected by the price cycle and have made some tough decisions to cut back on their operational expenditure.
“Management has been advised to consult with appropriate regulators and stakeholders before a final decision are taken.
“The board is aware of regulatory issues that Petromin has to comply with and as a Papua New Guinean company owned by the State, we wish to be responsible in terms of meeting compliance requirements.
“The process of consultation will commence with relevant stakeholders.”
The Tolukuma mine is a low capacity, high-grade operation and employs 630 people, including 130 contractors.
Open pit gold production began in 1995 followed by underground mining in 1997.
Chairman Sir Brown Bai said the mine’s high operating costs and a continuous subdued gold price have been a challenge for the mine and Petromin to continue with the operation and sustain the cash support required.
The mine is located in the Goilala district of Central, 100km north of Port Moresby and can only be accessed by helicopter.
Following a board meeting last Thursday, Sir Brown said: “Petromin has been losing money funding Tolukuma for the last four years
and with falling gold prices, Petromin can no longer sustain Tolukuma.
“Other companies within the industry have been affected by the price cycle and have made some tough decisions to cut back on their operational expenditure.
“Management has been advised to consult with appropriate regulators and stakeholders before a final decision are taken.
“The board is aware of regulatory issues that Petromin has to comply with and as a Papua New Guinean company owned by the State, we wish to be responsible in terms of meeting compliance requirements.
“The process of consultation will commence with relevant stakeholders.”
The Tolukuma mine is a low capacity, high-grade operation and employs 630 people, including 130 contractors.
Open pit gold production began in 1995 followed by underground mining in 1997.