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PNG said to seek bigger Porgera stake

Papua New Guinea is reportedly planning to take a larger stake of the Porgera gold mine where Barrick Gold (TSX: ABX) and Zijin Mining are seeking a lease renewal.
PNG said to seek bigger Porgera stake PNG said to seek bigger Porgera stake PNG said to seek bigger Porgera stake PNG said to seek bigger Porgera stake PNG said to seek bigger Porgera stake

Porgera’s mining lease is yet to be extended

Staff reporter

Porgera's special mining lease expired on Friday but Barrick said earlier this month the joint venture had been allowed to continue operations while its application for a 20-year extension was considered.

PNG's commerce and industry minister Wera Mori told Reuters in Sydney a portion of Barrick and Zijin's stakes would be given to the national and provincial governments and to landowners as part of the lease renewal talks.

"We would like to see the mine to continue, but this time to be structured in such a way with a lot more national interest in it," he said.

After a meeting with new PNG prime minister James Marape on August 1, Barrick president and CEO Mark Bristow had said a partnership approach was needed for the future of the Porgera mine.

He said at the time the PNG people had a right to benefit from the country's resources, mining companies made profitable resource development possible and this common cause called "for a productive, mutually rewarding partnership between the miners and their hosts".

Porgera is operated by Barrick Niugini, a joint venture held 47.5% by both Barrick and Zijin and 5% by local stakeholders Mineral Resources Enga.

Barrick Niugini donated K100,000 (US$29,450) to the 2019 PNG Medical Symposium last week and pointed out the company had provided more than K2 million (US$0.6 million) this year to the Enga Provincial Health Authority for the refurbishment and re-opening of the Paiam Hospital in the Porgera Valley.

PNG's reported stance follows Indonesia last year acquiring a majority stake in Freeport-McMoran's Grasberg copper-gold mine following long-running negotiations.

Barrick shares have gained 30.87% year-to-date and the company is capitalised at C$42 billion (US$31.5 billion).