PNG Porgera Gold Mine shareholders expecting K25 billion

 LOCAL shareholders of the Porgera gold mine in Enga, Papua New Guinea  expect to receive nearly US$7.3 billion (about K25.2 billion) over a potential 20-year mine life, according to Barrick Niugini Limited (BNL).

BNL country manager PNG operations Karo Lelai added that US$2.8 billion (K9.7 billion) would be for the first 10 years of the project.

She based the figures on the gold price of US$1,950 (K6,336) per ounce.

“The current gold price is significantly higher at approximately US$1,950 (K6,864) per ounce,” she said.

BNL is the operator of the New Porgera Limited (NPL).

“NPL would like to clarify certain matters related to the reopening of the Porgera gold mine that has been the subject of speculation and considerable misinformation in the national media over the past week.

“The benefit sharing terms agreed between the State, BNL, Kumul Mineral Holdings Limited (KMHL) and Mineral Resources Enga Limited (MRE) to restart the mine ensure a transparent and fair distribution of the economic benefits that will be generated by Porgera over its 20-year mine life.

“Over the life of the mine, PNG shareholders comprised Porgera landowners, Enga province and the State (KMHL which will hold the equity in new Porgera on behalf of the State) will receive 53 per cent of Porgera’s overall economic benefits.

“BNL will receive the remaining 47 per cent.

“Importantly, BNL has committed to finance the capital required to restart the mine.

“Once the mine has restarted, any additional loans made by BNL or its affiliates to New Porgera Limited will be on an interest-free basis.”

She said since the mine ceased operations more than three years ago, BNL had funded 100 per cent of the cost of care and maintenance, totaling US$540 million (K1.9 billion) to date.

“The State, KMHL and BNL agreed that KMHL’s dividends will initially be redirected to BNL to reimburse it for the costs of the care and maintenance.

“However, the other PNG shareholders are not affected by this arrangement and will receive their dividends as they are declared.”


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