Nautilus Minerals, developer of PNG’s offshore Solwara 1 mine, once again faced challenges at its AGM held in Vancouver, Canada, late last month.
Even with its latest US$34 million (K111.97 million) loan financing by Deep Sea Mining Finance earlier this month, Nautilus’ dreams to undertake the world’s first experimental deep sea mine, looks ever more distant.
Nautilus has been hit hard by the divestment of Anglo American who announced their break with the company just before their own AGM in May this year.
Andy Whitmore of the Deep Sea Mining campaign stressed that Anglo’s decision to divest, on top of Nautilus’s myriad problems, proves the company is running out of both credit and credibility.
“It is not just the company that is sinking, but the project – and the concept of deep sea mining itself – that is going down with it,” Whitmore said.
PNG, through Kumul Petroleum Holdings Limited (KPHL), formerly Petromin, also holds 15 per cent interest in the project worth K113.7 million that now hangs in the balance.
As reported Nautilus is now propped up by two shareholders – Russian miner Metalloinvest and Middle-Eastern oil and gas company Omani Conglomerate MB Holdings, both of whom are lending significant amounts of money in bridging loans at 8 per cent interest.
“Nautilus is increasingly controlled by these two entities, which in the case of Metalloinvest opens up serious worries that it could be hit by further US sanctions against Russian oligarchs,” said Whitmore.
“The company is in a parlous state with its finances. Even if Nautilus was to become bankrupt and someone else took over the project, they would face the same social and legal – let alone environmental – risks.”
The reluctance of investors was ascribed by a recent article to “the unknown feasibility of this type of activity and concern that they could potentially be deemed to be complicit in environmental degradation.”
Growing local opposition in PNG has also seen communities come out in force at formal hearings to oppose the granting of Nautilus’s exploration licences and a legal challenge regarding Solwara 1 has been lodged.
Next:
Even with its latest US$34 million (K111.97 million) loan financing by Deep Sea Mining Finance earlier this month, Nautilus’ dreams to undertake the world’s first experimental deep sea mine, looks ever more distant.
Nautilus has been hit hard by the divestment of Anglo American who announced their break with the company just before their own AGM in May this year.
Andy Whitmore of the Deep Sea Mining campaign stressed that Anglo’s decision to divest, on top of Nautilus’s myriad problems, proves the company is running out of both credit and credibility.
“It is not just the company that is sinking, but the project – and the concept of deep sea mining itself – that is going down with it,” Whitmore said.
PNG, through Kumul Petroleum Holdings Limited (KPHL), formerly Petromin, also holds 15 per cent interest in the project worth K113.7 million that now hangs in the balance.As reported Nautilus is now propped up by two shareholders – Russian miner Metalloinvest and Middle-Eastern oil and gas company Omani Conglomerate MB Holdings, both of whom are lending significant amounts of money in bridging loans at 8 per cent interest.
“Nautilus is increasingly controlled by these two entities, which in the case of Metalloinvest opens up serious worries that it could be hit by further US sanctions against Russian oligarchs,” said Whitmore.
“The company is in a parlous state with its finances. Even if Nautilus was to become bankrupt and someone else took over the project, they would face the same social and legal – let alone environmental – risks.”
The reluctance of investors was ascribed by a recent article to “the unknown feasibility of this type of activity and concern that they could potentially be deemed to be complicit in environmental degradation.”
Growing local opposition in PNG has also seen communities come out in force at formal hearings to oppose the granting of Nautilus’s exploration licences and a legal challenge regarding Solwara 1 has been lodged.
Next: