Illegal Mining activities costing Millions for miner Barrick Gold Corporation in PNG

Illegal mining activities at the Porgera gold mine in Enga is costing the operator around K4.5 million (US$2.8 million) a month, it has been revealed.

Barrick Gold Corporation president and chief executive officer Mark Bristow attributed the loss in revenue to “the traditional environment where the mine operates”.

“We deal with social crisis almost every day in Porgera,” Bristow said.

“So K4.5 million a month. Just think about it. That could be going to the community,” he said.

“Porgera is a critical component not only on the country’s revenue to date but because it’s real and it’s happening every day.

“It is a very important engine in the part of Papua New Guinea which is traditionally volatile.”

He estimates a loss of between US$800 million and USS1.5 billion (K2.65 billion and K5 billion) from the illegal activity.

He said Porgera was a large contributor to the Engan provincial economy and the PNG treasury.

“From the revenue created by Porgera, 48 per cent of every kina arrived either in the provincial purse, the national treasury purse, with the provincial governor or the landowners,” he said.

“And 52 per cent has arrived in the hands of the investors who continue to reinvest the money.”

Bristow said Porgera was one of the largest employers in the country with 3,100 workers, 1,000 of whom were from the Porgera region.

He said 900 employees were given opportunities to study overseas.

Meanwhile, acting managing director of the Mineral Resources Authority Philip Samar said earlier the Government was committed to addressing the issue of illegal mining at Porgera.

He was responding to concerns raised by the Porgera Joint Venture (PJV) that there had been a huge increase in the number of illegal miners who had access to the stockpiles and open pit area, putting their own lives and the lives of company employees at risk.

The activities resulted in the loss of lives and injuries to illegal miners and employees.

A team of government officials, including Mineral Resources Authority officers, were sent to the mine site to reassess the illegal mining situation.

He said the situation had escalated “such that the normal daily mine operations are being significantly hindered and the mine is not able to operate at its full production capacity”.

“Barrick has approached the Government to urgently provide assistance in resolving this law and order issue so that the mine can continue its normal operations,” he said.

“The company is concerned that at the rate and the manner at which illegal miners were operating, the mine could face serious problems including shutting down operations,” he said.


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