BARRICK URGED TO OBSERVE COURT DECISIONS AND FULFILL ITS RESIDUAL OBLIGATIONS UNDER CLAUSE 19 OF MINING DEVELOPMENT CONTRACT: PM MARAPE
On the 1st September 2020, the National Court, constituted by the Honourable Deputy Chief Justice Ambeng Kandakasi, dismissed the judicial review proceedings filed by Barrick (Niugini) Limited (BNL) against the decision of the National Executive Council and the decision of the Head of State, to not to renew the Special Mining Lease (SML) over the Porgera Gold Mine, for being an abuse of the process of Court and for being incompetent.
BNL, aggrieved by the decision of the National Court, filed on the 07th September 2020 an Appeal in the Supreme Court prefixed SCM No. 18 of 2020 and made an Application to stay the decision of the National Court.
The Supreme Court, on the 25th September, 2020 in dismissing the Stay Application observed, amongst other things, the following fundamental facts which accurately describes the virtual reality on Porgera Gold Mine.
1. The decision to refuse Barrick’s application for extension of the SML was made by the NEC on the premise that the statutory procedure under the Mining Act 1992 has been observed.
2. It is arguably the first time a decision has been made by the Executive Government to part ways with a developer in a mining project in the Country after 30 years of operation.
3. However, it would appear that the Executive Government has made a decision to move on.
4. The latest turn of events and, in particular, the government’s decision to grant a SML over the land on which the mine is located to Kumul Mineral Holdings (KMHL) on 25th August, 2020 can be viewed as the State’s further act of parting ways with Barrick.
5. This later decision has now put Barrick in a situation where it must now not only challenge the decision to refuse to extend the SML but also the grant of a SML to KMHL.
6. At the end of the day, these turns of events reinforces the view that the State is unwilling to reverse the first decision taken by the NEC and the relationship between the parties (PNG and Barrick) at worst has become obnoxious and broken down to the point of no return and it would not be in the interest of justice that the unwilling party be ordered to maintain the relationship.
7. As there is not much to be concerned about, in relation to the safety of the mine, its operations and personnel and that the relationship between the parties has become obnoxious and broken down. It is in the interest of justice that the present status quo be maintained, as it has been, since the decision of the NEC dated 11th March, 2020.
I welcome these important observations and the ruling of the Supreme Court. I urge Barrick to humble itself, observe the rule of law and fulfil its residual obligations under Clause 19 of the Mining Development Contract (MDC) it signed on 12th May, 1989. The State reserves its right under Clause 19 (c) of the MDC to acquire the assets at a fair market value. The State also reserves it’s further right under Clause 19.2 of the MDC to give the appropriate consent upon expiry of a one year period from the date the SML expired (16th August, 2019) enabling all assets of the Porgera Gold Project to become the property of the State without any cost to the State or any liability for the State to pay compensation.
The State expects the new lease holder to re-open the Mine immediately and I encourage all citizens and stakeholders to cooperate fully in this regard.
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