Seabed mining: a lot of reasons we don’t need it
31 August 2012
MARTYN NAMORONG | Namorong Report
DR ILA TEMU, the spokesperson for mining companies in Papua New Guinea recently raised a series of points in support the former Somare government's decision to allow Nautilus Minerals to destroy the Bismarck Sea and current Mining Minister Byron Chan's decision to maintain the status quo.
Dr Temu highlighted that many organizations were misinforming the public about the issue. However, if one takes a look at maps on Nautilus Minerals website, one begins to appreciate the scale of the disaster Nautilus intends to create. It has tenements over vast areas of the Bismarck Sea and the internal waters of Milne Bay Province.
Dr Temu claims that since Nautilus Minerals has received government approvals its exploits are sound. One only has to look at government approved projects like Panguna, Ok Tedi, Porgera and Hidden Valley to appreciate that government approvals cannot be trusted.
The manner by which the Somare government was willing to amend Environmental Laws in favour of mining companies, also indicates the standards used to give approvals.
In any case, what body of scientific knowledge about the territorial waters of PNG has the government used to create the necessary legislative, institutional, policy and regulatory frameworks necessary to approve and regulate seabed mining?
Professor Richard Steiner from the University of Alaska Marine Advisory Program reviewed Nautilus Mineral's Environmental Impact Statement. He stated in his concluding remarks that "clearly, the project is not sustainable, as it exploits a relatively finite mineral deposit, lasts only 30 months, contributes a relatively small amount of money to [PNG], severely damages the benthic habitat for a rare deep sea sulfide mound ecosystem and poses risk to other marine resources in the region..."
It would be interesting for the Department of Environment and its former boss Wari Iamo to explain to the people of PNG how they assessed Nautilus Minerals EIS and how they came up with monitoring mechanisms.
The recent Tumbi Landslide in the Southern Highlands highlights the risks posed by large extractive industries in terms of creating man-made disasters. Nautilus Minerals will be altering seafloor morphology in an actively tectonic region.
Natural undersea tectonic events pose a number of geohazard risks (e.g., the Aitape tsunami) to coastal communities. The Nautilus activities will only add to these risks.
Dr Temu also highlighted that any action by the government to stall Nautilus Minerals' Solwara 1 project will increase PNG’s sovereign risk profile. Commenting on the possibility of government intervention, Dr Temu said, “This would also raise concerns in the international investment community of the dangers of sovereign risk."
Sovereign risk refers to the credit worthiness of the "sovereign", i.e., the government, and is used as a measure by financial institutions as to whether a country is worth investing in. It is measured using complex mathematics and data but in a nutshell it reflects two main variables: political risks and fiscal risks.
Will stalling Nautilus increase PNG's sovereign risk profile? On face value, yes. But when put in context, the risk is not significant. We live in a world where, compared to the sovereign risk profiles of debt-ridden European economies, PNG is a much better destination for investment.
PNG doesn't have to worry about any sovereign risk associated with small players like Nautilus Minerals when a major player like Exxon Mobil has shown confidence in PNG as a destination for major long term investments.
The LNG project is a much longer, 30 year investment compared to Nautilus's 30 month mining experiment.
Recently at a recent conference in Sydney, Peter Graham, the managing director of Esso Highlands Ltd, highlighted that the LNG Project makes PNG a good investment destination.
"The Project will generate many direct benefits but also contribute indirectly to growth by stimulating associated businesses and demonstrating to the world that PNG can be an attractive investment destination," he said.
In a world where there is growing demand and depletion of natural resources, PNG is now better placed to dictate the terms by which it resources are extracted. The granting of licenses and permits to Nautilus were flawed and the injustice perpetrated against coastal communities must be corrected.
There is an increasing number of MPs in the O'Neill government who oppose seabed mining. Maverick Madang politician, Ken Fairweather was the first MP to oppose experimental seabed mining.
Planning Minister Charles Abel has signed the petition against seabed mining and his Milne Bay governor, Titus Philemon, has done likewise.
Oro Governor Gary Juffa leads a group of Middle Bench MPs who also would like to see a moratorium on seabed mining in PNG. Madang Governor Jim Kas has also expressed his opposition to the project.
Given current local and global economic conditions, Dr Ila Temu may be exaggerating the sovereign risk associated with stopping Nautilus. Nautilus Minerals' 30 month seabed mining experiment in insignificant compared to the greater scheme of things in PNG.
The people of PNG and their leaders can confidently stop this evil act with very few adverse effects to the investment environment in PNG. The lesson here for foreign corporations is that gone are the days when you can take short cuts, mislead and bully the people of PNG.
Stop the deep sea tailing disposal. Stop sea bed mining. Stop killing our fish and our very existence. Enough said. Time to stop this pure madness.
If you have not seen and read this piece in today's Post Courier; "Stop seabed mine: Landowners"; Post Courier; Wednesday 24th October 2012. Here is it again (good old copy and paste - the best invention ever). This is pure bagarapment & korapment.
LANDOWNERS in Papua New Guinea have petitioned the government to halt a controversial seabed mining project along the nation’s coast.
Mining Minister Byron Chan on Tuesday was handed a petition with 24,000 signatures from residents of Madang, Oro and New Britain provinces who say they do not want Canadian-owned Nautilus Minerals’ Solwara 1 project in PNG’s Bismarck Sea to go ahead.
The project is the first of its kind in the world and will see minerals - mostly copper and gold - extracted from the ocean floor.
Residents from provinces around the Bismark Sea say fish have been turning up dead on their beaches and the water has been polluted by exploration works.
“What guarantees do we have that the explorations going on are not disturbing our eco-system from the sea floor and up?” New Ireland resident Oigen Schulze said.
...”The sediments that are causing the waters to be dusty and murky during the calm weather, can that be from the sea floor? How is it possible for schools of dead fish to be spotted on the shores of New Ireland?
“I as the voice of the communities in New Ireland province request that this project be put to a stop, as we do not really know what we are getting ourselves into.”
Nautilus was granted a 20-year lease by the government of Sir Michael Somare in March last year and plans to mine an area 1.6km beneath the ocean, 50km off the coast of New Britain island.
Mr Chan, who is the MP for New Ireland province, told the group of about 30 concerned residents and activists that the government would make the right decision regarding the site.
“I am faced with the issue right now, Prime Minister Peter O’Neill is faced with this issue ... we are a responsible government and we are treating this matter responsibly,” he said.
“I cannot go into too much about what has been presented. We are in a dispute resolution right now with Nautilus over aspects of the deal that have been presented.”
The PNG government is reportedly challenging the March deal and wants to make amendments.
Posted by: Chalapi Pomat | 24 October 2012 at 09:48 PM
Erasmus Baraniak - thank you for putting this matter so eloquently.
We need the likes of you, Martyn Namorong and brave young leaders like Hon Gary Juffa - and many more - together we can stop this madness now please.
Let me know where we go from here - for I am ready to go to battle with you on this very important issue.
Posted by: Chalapi Pomat | 02 October 2012 at 05:39 PM
TUNA – THE WAY OF THE FUTURE?
As the reserves of Papua New Guinea’s oil and mineral resources available for exploitation decline every year, the focus must of necessity shift to other natural resources as an exercise in prudence.
While the prolific gas resources of the country have caught the imagination of our young politicians and international financial markets, tuna, one of the greatest natural and renewable resources of Papua New Guinea, remains the best anchor yet for a brighter future. Yet our politicians generally, and those who are advising, are largely ignorant of this.
Papua New Guinea currently faces serious threats both external and internal, to the security of this great resource.
In the ‘90s a key government Minister who hails from Southern Highlands, who happens to be the Mining Minister at that time, gave exploration licenses to Barrick’s then subsidiary Nautilus over large square-kilometres of the Bismarck Sea, without any government policy on offshore Mining, let alone a proper regulatory regime under pinned by appropriate legislation.
It was an extremely irresponsible decision for any government Minister to make without understanding the full implications of that decision. That decision, aided by the Mining Department machinery at that time, has now plunged the nation into this major tussle between Nautilus, who have invested so much money in exploration over large areas of our territorial waters, the Mining industry advocates and raft of scientists who rally on Nautilus’ side and the small man on the street who feels something is terribly wrong, but can’t quite eloquently advocate why.
There is another threat that has greatly impacted on our tuna and other pelagic species that has gone largely unnoticed. Pilfering, poaching and policy failure. Through the external pilfering, and internally, by lack of appropriate policy to secure it, this great resource is now at a crisis point. At the centre of this unfolding tragedy is the lack of key functional information and statistics as to the nature of the threats posed to tuna fishery, and general lack of comprehension and appreciation of the commercial magnitude of the crisis on the part of the government.
A recent regional fisheries conference in New Zealand was told by New Zealand Government representatives and its Foreign Minister that the Pacific Islands including Papua New Guinea was losing conservatively upward of US$100 million per annum to illegal fishing.
Whilst this figure should ring serious alarm bells for governments in the Pacific, the reality is that it simply does not make the political radar screen. Other issues of internal political survival appear to take the fore leaving bureaucrats and policy makers to take a minimalist approach. The actual losses for a country like Papua New Guinea are likely to be higher than what the New Zealand conference was told.
Papua New Guinea’s waters extending to its Exclusive Economic Zone (EEZ), at most times of the year hosts over 20% of the worlds tuna stocks, mainly of yellow fin specie. It is valued well over US$20 Billion at sustainable levels to the small countries of the South-West Pacific, including PNG. It is a sacred act of God alone that the cold Okhotske currents emanating from Vladivostok and running off Sakhalin and the other Islands off the Northern tip of Japan should greet the warm Pacific current right here on our door step, thus creating plankton and other feed stock. This in turn presents a solid platform for spawning of a prolific tuna and other pelagic fishery for us.
This fishery has been conservatively valued at US$2 billion per annum at sustainable levels. It is likened, if you like, to Papua New Guinea pulling the winning lottery ticket worth US$2 billion every year.
Papua New Guinea, therefore, stands the envy of the world, and yet the abject tragedy of it all is Papua New Guinea has failed to fully understand that it has the “winning ticket” in its hand.
There are schools and schools of schools, colleges, universities, roads, bridges, airstrips, health centres, hospitals, infrastructure, jobs and major industry etc, literally swimming around the waters of Papua New Guinea and yet the nation is yet to make the quantum leap at the leadership level to grasp the commercial reality of this asset and what it means for the future of the country.
A similar paradigm shift must also occur with other resources such as timber, where the leadership must see chairs, tables, world class furniture, decent homes etc in every tree, to fathom the possibilities for the people.
It is a known fact that the tuna fishery in both the Indian and Atlantic Oceans have been seriously depleted by purse-seiners and super-seiners capable of catching and holding anything from 900 – 1,500 short tons. These vessels can trans-ship and remain at sea for months at a time. Whilst this last April’s National Geographic magazine depicts a UN Assessment Report that 30% of the world’s fish stocks are currently over-fished, there is in PNG a level of apathy about our fish stocks that is borne out of lack of information on what is really going on in our own waters with our fish stock. This situation is alarming and the Government may not realize it for what it represents until it is too late for the country’s fish stocks. The degree of ferocity with which super-seiners have left the great oceans of the world bare can only be equalled to tragedy of a bushfire on land where nothing is left standing and nothing green is seen for miles.
In the last fifteen years Papua New Guinea has evolved a policy of tuna domestication, aimed at seeking greater returns for its tuna resources. Under this policy a number of previously foreign licensed (Distant Waters Vessels), purse-seiners, have been brought on shore and several onshore processing facilities have been set up.
However, whilst some industry participants have been genuine, others have taken more than commercial advantage of the domestication policy. A thorough economic analysis will reveal that the domestication policy has had minimal success, if at all. It has not delivered the level of returns earlier predicted by the policy.
To this day, Papua New Guinea has issued far more licenses to Distant Water Vessels than it has the capacity to process their catch. The State has failed to monitor and ensure a healthy co-relation between Distant Water licences to seiners and capacity to downstream process, resulting in the bulk (over 80%) of the catches of domesticated vessels going off-shore.
If the country does not have the capacity to process or value add domestically it should not issue excessive number of licences than the volumes its processors can sustain. It is only presiding over and legitimatizing its oceans to be raped and stripped bare for very little return, and this process clearly discounts the purpose of the domestication policy. There is therefore urgent policy and legal reform required on Access and Domestication policies to serve the national interest.
The Access and Domestication Policy has failed the people, and the nation. It needs to be overhauled.
Papua New Guinea is also losing hundreds of millions of kina annually to illegal fishing, illegal transshipping, illegal bunkering and illegal importation of goods in the EEZ. Illegal fishing and other illegal activities pose a serious and growing threat to Papua New Guinea and its security on the international sea borders. Not a week goes by without local people from Western, Sandaun, Milne Bay or Manus crying out to their Government to protect them and their fishing grounds.
Indonesian fisherman even set up camp several hundreds nautical miles into Papua New Guinea Territory and fish for shark fin and other exotic varieties. On Kiwai Island, for instance, on the Fly River estuarine, only 2 years ago Indonesian nationals boldly sailed in, set up camp and engaged in the act of harvesting fish. They have successfully destroyed their own fishery through over-fishing and by use of dynamite, cynide and other environmentally destructive practices. Unless they are stopped, they will disregard State borders and are not likely to abate with the pressure of a growing population of over 180 million needing to be fed.
In addition to the increasing problem with Indonesia, there are unlicensed seiners and super-seiners riding the high seas off Milne Bay, Manus, Vanimo, New Ireland and North Solomons Provinces, illegally harvesting Papua New Guinea’s tuna. They dart in and out and fish with impunity knowing very well Papua New Guinea has neither the means of aerial surveillance nor the patrol vessels to catch them. The degree and extent of pilfering or poaching is not known because the Government of Papua New Guinea over the years has not invested in a program of systematic aerial surveillance program coupled with other research to garner necessary data.
Long after the oil and gas, and the mineral resources of Papua New Guinea have been depleted, it is hoped that tuna will secure and sustain the economic future of the country. However, that hope will be misplaced if Papua New Guinea continues to stand by and watch while its oceans are pillaged and laid bare, to become a barren and silent void, to the enrichment of other nations.
Papua New Guinea has the opportunity now to act fast to avoid this seemingly inevitable tragedy.
In respect of Nautilus and its band of Media-happy Merrymen, whilst they have performed their license conditions under the respective exploration licenses they hold, they must understand that exploration is what they wanted at their risk, and that is what they got. That license scheme does not automatically entitle them to a Mining Lease or a Special Mining Lease from the government and people of Papua New Guinea.
The people of Papua New Guinea must understand that Nautilus does not have a right, or an automatic right to Mining Licenses in the Bismarck sea or any sea area in PNG.
Sea-bed Mining cannot give the economic returns to PNG as our Tuna and our pelagic species and other marine resources can. On numbers along it is doubtful Nautilus can put US$2 Billion in the nation’s coffers every year at environmentally sustainable levels. In fact it can’t, and it won’t.
So who is this nation trying to fool, by playing with the likes of Nautilus? The day we engage them and their one-eyed scientists to dig and dump in our pristine oceans, is the day we kiss goodbye to one of the world’s remaining great fishery, great tuna spawning areas, and the Children of PNG both born, and unborn may as well kiss goodbye to a prosperous future.
Nautilus is running a deliberate media campaign with the support of certain government Ministers who are in bed with it, and without accusing any one of corruption, we all know there are no free lunches in Port Moresby, so we will be keenly watching which Minister is going to sell the interests of this nation this time for 30 pieces of silver.
Papua New Guineans must get behind the lone voices of such brave young leaders like Hon. Gary Juffa now and stop this madness that threatens our tuna, and our future.
Posted by: Erasmus Baraniak | 02 October 2012 at 01:47 PM
Hasn't our contry faced enough problems already with the other mines in the country?
Papua New Guinea is endowed with vast natural resources but lets not rush into mining the seabed, no way.
Once the ocean floor is disturbed, so will the ecosystem and everyone with sympathize with the marine life.
We should all stop, think and act before it's too late.
Posted by: Zenaleze Tomun Abage | 07 September 2012 at 09:10 AM
This DSM madness must stop. The same applies to submarine tailing disposals - a practise that is outlawed in Australia but allowed to be used in PNG.
Posted by: Chalapi Pomat | 06 September 2012 at 03:37 PM
Seabed mining by Nautilus means destruction to marine life letting the people who depend on marine life suffer.
Posted by: Jay Kepas | 05 September 2012 at 08:06 PM
Looks like PNG is over excited and playing up with the minerals, why not try to stop and think about the damage it can cause.
There are plenty of mining activities going on right now so stop that seabed mining. Looks like our government heads are full of money, money all the time - we don't see any change to our economy and our country.
Stop seabed mining.
Posted by: B Kaupa | 05 September 2012 at 07:49 PM
Simply put a stop to seabed mining because since the establishment of many mines here in PNG not much have happened to the development of this nation.
Posted by: Jay Kepas | 05 September 2012 at 07:24 PM
It's so funny to PNG to become the puppet for the outsiders. When asking for favour, PNG becomes the yes master.
If it's only experimental, why would PNG say yes? Thanks to those leaders who are going against the seabed mine.
Posted by: Edzii Kuvem | 05 September 2012 at 05:07 PM
To an outsider, the mining proposal seems to be a one street favouring the miner’s interests only.
Taken on face value, it all seems very rosy for the mining company itself that is, with possible long term negative environmental impacts secreted away in the depths for no one to see.
On the other side of the coin, what advantages would result from the proposed mining venture?
On face value it would seem that the scheme would not provide any local employment opportunities as the dredges would comprise the ships crew only hence any added value to the locals through possible employment would be zilch.
The most important issue facing the PNG government would be how they then assess what mining royalties should apply if the completed processed product remains on board the ships involved.
Assessment of mining royalties in conventional mining operations can be easily assessed through detailed feasibility studies into ore body tenements.
As such it would be extremely difficult to ascertain the value of such a hidden resource due to its isolation from examination?
Posted by: Harry Topham | 03 September 2012 at 11:03 AM
"...gone are the days when you can take short cuts, mislead and bully the people of PNG..."
Hopefully, gone are the days when elected officials put their own interests ahead of the interests of the people and places they represent.
Posted by: John Whitchurch | 03 September 2012 at 08:38 AM
Simply put a stop. PNG does not need any mining development. What we lack is transparency and good governance.
Posted by: Joe Wasia | 31 August 2012 at 06:06 PM
Thanks Martyn. Nicely said.
Tim's suggestion for the EIS to be peer reviewed is spot on.
Posted by: David Kitchnoge | 31 August 2012 at 10:53 AM
Thanks Martyn for this well researched and balanced article.
"Better to be sure than sorry"!
Let's hope that the younger generation will keep reminding these older PNG men, who have carried very responsible jobs for a long time, to "keep up with the times".
Hopefully younger PNG men who have had recent experience working in other large mining ventures thoughout the world will speak out about all the environmental problems that may arise and need to be dealt with.
Posted by: Mrs Barbara Short | 31 August 2012 at 09:36 AM
Undersea mining as proposed by Nautilus is a total step into the unknown.
They have produced an EIS and, from my quick read of the executive summary, it is more supposition than factually based.
I am not a scientist and from my perspective, until the EIS is peer reviewed, it can only be at best, the optimistic opinion of an organisation that has a vested interest in it being accepted.
Posted by: Tim Ashton | 31 August 2012 at 08:30 AM