Barrick Niugini Limited (BNL), majority owner and operator of the
Porgera gold mine in the Enga province of Papua New Guinea (PNG),
said today the Government’s decision not to extend its Special
Mining Lease was tantamount to nationalisation without due process
and in violation of the Government’s legal obligations to BNL.
BNL said it remained willing to discuss the
issue with Prime Minister James Marape and his Government in the
hope of averting what it described as a catastrophic situation for
the communities at Porgera and in Enga, and for the country as a
whole.
It will, however, pursue all legal avenues to
challenge the Government’s decision and to recover any damages that
BNL may suffer as a result of the Government’s decision. It also
said it had no interest in discussing transitional arrangements for
the management of the mine, as proposed by the Government, as this
was not consistent with BNL’s rights. BNL’s right to the renewal
was confirmed by the PNG National Court in August 2019.
BNL applied for the extension of the SML in June
2017 and has been engaging with the Government on this matter since
then. In 2019, in response to a request from Prime Minister Marape,
the company proposed a benefit-sharing arrangement that would
deliver more than half the economic benefits to PNG stakeholders
including the government for 20 years.
Barrick President and Chief Executive Mark
Bristow has met with Prime Minister Marape four times to discuss
the extension issue and to re-affirm BNL’s commitment to a
long-term partnership with PNG. After their first meeting in June
last year, the Prime Minister wrote to Bristow stating that “the
Government values our continued partnership with Barrick and it is
our intention to do everything possible to ensure that arrangements
are in place to enable continued operations of the Porgera Gold
Mine once the current SML expires in August 2019”.
Despite this and other assurances, and numerous
encouraging conversations with Government ministers and
representatives, neither the Prime Minister nor anyone acting on
behalf of the Government has ever proposed any alternative terms on
which the SML could be extended, or indicated that it would not be
extended.
The Government has also ignored the wishes of
the Porgera landowners, who overwhelmingly support the extension of
BNL’s lease, and the Prime Minister has refused to consult them or
even hear their views.
BNL also notes that the Government has advanced
the existence of alleged environmental damage claims and
resettlement issues as a reason for the non-extension. The company
says the environmental management practices at the mine were
studied and approved by the Government. The PNG Conservation and
Environmental Protection Authority (CEPA) has carried out regular
audits of the mine and has always found it to be in compliance with
its permits. In fact, BNL’s environmental management system exceeds
the requirements of its permits. As far as resettlement is
concerned, BNL has compensated and relocated more than 1,400
households impacted by the mine’s operations, and at no stage has
the government indicated that the mine had not complied with its
obligations in this regard.
About Porgera
The Porgera Joint Venture is an open pit and
underground gold mine located at an altitude of 2,200-2,600 metres
in the Enga Province of Papua New Guinea, about 600 kilometres
north-west of Port Moresby. Barrick and Zijin Mining Group each own
47.5% of the operation, with the remaining 5% interest held by
Mineral Resources Enga. Mineral Resources Enga Limited's 5%
interest is divided between the Enga Provincial government (2.5%)
and local landowners (2.5%).
Enquiries:
Investor and media relationsKathy du Plessis+44 20
7557 7738Email: barrick@dpapr.com
Website: www.barrick.com
Cautionary Statement on Forward-Looking
Information
Certain information contained or incorporated by
reference in this press release, including any information as to
our strategy, projects, plans or future financial or operating
performance, constitutes “forward-looking statements”. All
statements, other than statements of historical fact, are
forward-looking statements. The words “remain”, “pursue”,
“propose”, “affirm”, “would”, “commit”, “partnership”, “intend”,
“will”, “future”, “opportunities” and similar expressions identify
forward-looking statements. In particular, this press release
contains forward-looking statements including, without limitation,
with respect to: Barrick and BNL’s response to the Government’s
decision not to extend the Special Mining Lease including legal
challenges to the Government’s decision and avenues to recover any
damages that BNL may suffer as a result of the Government’s
decision; the future for Porgera, including opportunities
identified by Barrick and BNL to deliver economic benefits to PNG
stakeholders including the Government for up to 20 years under a
potential benefit-sharing arrangement; BNL’s environmental
management system and compliance with its environmental permits and
resettlement obligations at the Porgera mine; and discussions to
reach agreement with the PNG government regarding an extension of
the Special Mining Lease.
Forward-looking statements are necessarily based
upon a number of estimates and assumptions including material
estimates and assumptions related to the factors set forth below
that, while considered reasonable by the Company as at the date of
this press release in light of management’s experience and
perception of current conditions and expected developments, are
inherently subject to significant business, economic and
competitive uncertainties and contingencies. Known and unknown
factors could cause actual results to differ materially from those
projected in the forward-looking statements and undue reliance
should not be placed on such statements and information. Such
factors include, but are not limited to: timing of receipt of, or
failure to comply with, necessary permits and approvals, including
with respect to BNL’s application for an extension of Porgera
special mining lease; changes in national and local government
legislation, taxation, controls or regulations and/or changes in
the administration of laws, policies and practices, expropriation
or nationalization of property and political or economic
developments in PNG; lack of certainty with respect to foreign
legal systems, corruption and other factors that are inconsistent
with the rule of law; the risks associated with Covid-19 and other
infectious diseases presenting as major health issues; risks
associated with illegal and artisanal mining; fluctuations in the
spot and forward price of gold, copper or certain other commodities
(such as silver, diesel fuel, natural gas and electricity); the
speculative nature of mineral exploration and development; changes
in mineral production performance, exploitation and exploration
successes; risks associated with projects in the early stages of
evaluation and for which additional engineering and other analysis
is required; diminishing quantities or grades of reserves;
increased costs, delays, suspensions and technical challenges
associated with the construction of capital projects; operating or
technical difficulties in connection with mining or development
activities, including geotechnical challenges and disruptions in
the maintenance or provision of required infrastructure and
information technology systems; failure to comply with
environmental and health and safety laws and regulations;
uncertainty whether some or all of Barrick's targeted investments
and projects will meet the Company’s capital allocation objectives
and internal hurdle rate; the impact of global liquidity and credit
availability on the timing of cash flows and the values of assets
and liabilities based on projected future cash flows; adverse
changes in our credit ratings; the impact of inflation;
fluctuations in the currency markets; disruption of supply routes
which may cause delays in construction and mining activities;
damage to the Company’s reputation due to the actual or perceived
occurrence of any number of events, including negative publicity
with respect to the Company’s handling of environmental matters or
dealings with community groups, whether true or not; the
possibility that future exploration results will not be consistent
with the Company’s expectations; risks that exploration data may be
incomplete and considerable additional work may be required to
complete further evaluation, including but not limited to drilling,
engineering and socioeconomic studies and investment; risk of loss
due to acts of war, terrorism, sabotage and civil disturbances;
litigation and legal and administrative proceedings; contests over
title to properties, particularly title to undeveloped properties,
or over access to water, power and other required infrastructure;
business opportunities that may be presented to, or pursued by, the
Company; risks associated with working with partners in jointly
controlled assets; employee relations including loss of key
employees; increased costs and physical risks, including extreme
weather events and resource shortages, related to climate change;
and availability and increased costs associated with mining inputs
and labor. In addition, there are risks and hazards associated with
the business of mineral exploration, development and mining,
including environmental hazards, industrial accidents, unusual or
unexpected formations, pressures, cave-ins, flooding and gold
bullion, copper cathode or gold or copper concentrate losses (and
the risk of inadequate insurance, or inability to obtain insurance,
to cover these risks).
Many of these uncertainties and contingencies
can affect our actual results and could cause actual results to
differ materially from those expressed or implied in any
forward-looking statements made by, or on behalf of, us. Readers
are cautioned that forward-looking statements are not guarantees of
future performance. All the forward-looking statements made in this
press release are qualified by these cautionary statements.
Specific reference is made to the most recent Form 40-F/Annual
Information Form on file with the SEC and Canadian provincial
securities regulatory authorities for a more detailed discussion of
some of the factors underlying forward-looking statements and the
risks that may affect Barrick’s ability to achieve the expectations
set forth in the forward-looking statements contained in this press
release.
We disclaim any intention or obligation to
update or revise any forward-looking statements whether as a result
of new information, future events or otherwise, except as required
by applicable law.
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