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Bougainville: the nuts & bolts of a return to mining


Joseph PangkauA HIGH-LEVEL TEAM from the Bougainville government’s mining department has told a conference in Madang of how the autonomous province is preparing itself for the resumption of mining on the island.

Bougainville was represented at the three-day community relations mining workshop held earlier this month. At the workshop, mining officials shared each other’s experiences with each other and with the industry.

The Autonomous Bougainville Government’s (ABG) Department of Mining was represented by a team of four led by mining engineer Joseph Pangkau (pictured), Director of the Development & Coordination Division, who invited me to attend the meeting.

In the half-full conference room, the team detailed the state of play with mining in Bougainville.

They talked of how mining had previously created conflict and spoke of the suffering of Panguna landowners that led to the conflict, the Bougainville economy, the political future of the province and how the ABG wishes to re-open the mine - including the costly exercise of working towards possible re-opening.

Mr Pangkau said the Department of Mining was created under the Bougainville Peace Agreement, the Bougainville Constitution and the PNG Constitution.

On 16 November 2006, PNG agreed to give Bougainville powers on mining, oil and gas in a 15-stage strategic framework. The mining department was created to cater for these powers. So far, stages 1 and 2 have being reached and currently they are in stage 3, negotiations for Panguna mine.

The ABG answered the question of ‘why re-open Panguna mine’ with five points. Firstly, Mr Pangkau said that Panguna has proven and known minerals; secondly, the mine life is known; thirdly, the infrastructure is there and needs only maintenance; the Bougainville economy will be stimulated with commencement of construction; and lastly, the ABG needs to be fiscally self-reliant to run its affairs.

He claimed that, at the heart of the ABG, are lessons from the past about mining operation at Panguna. Thus landowners will be the major players in the decision over mining this time around with equitable benefit sharing and an effective environmental impact management scheme.

Currently the ABG is focused on six key issues:

(1) establishing landowner associations

(2) running public forums to collect Bougainville-wide opinion

(3) facilitating a baseline study of the Panguna mine areas

(4) assessing consultancy work relating to technical evaluations and feasibility studies

(5) conducting studies in mineral resources and ore body modelling of Panguna

(6) conducting financial modelling and economic and budgeting studies

Mr Pangkau stated that Panguna has nine landowner associations of which six are well established and functioning. These have an umbrella body, the United Panguna Resource Owners Association, that will be the key player in re-opening negotiations. Each landowner group has start-up funding from the ABG.

ABG now has the duty to support landowners and their associations; build their capacity; prepare them for negotiations; recruit advisors and consultants along with BCL and the PNG government.

ABG has also committed itself to wider consultations across Bougainville. It has run consultative forums in Central, North and South Bougainville. Mr Pangkau said these forums ran for about two days each and that attendance was good and participation positive.

In August 2012, a joint ABG and National Government Scoping Mission had conducted a review to determine the type of baseline studies that need to be conducted to provide information on environmental, social and economic conditions of the people in Panguna.

Then, on 17 October 2012, a Joint Panguna Negotiation Coordination Committee was established comprising the ABG, BCL, landowners and the PNG government.

One important issue of negotiation under JPNCC is the belkol money (compensation) issue. This is a kind of appeasement that must be paid to Bougainville before BCL attempts to return, for it is not only the Panguna people that have suffered in the conflict. The forms and extent payment have not been determined yet.

There is also a negotiation structure approved by the Bougainville Executive Council in place to ensure input into negotiations by all Bougainvilleans, and specific opportunities for input by groups including landowners and ex-combatants.

The overall direction for negotiations will be provided by a Negotiation Forum made up of the ABG President, John Momis, Vice President and Ministers; landowners, ex-combatants; and senior ABG officers.

This is an inclusive structure that will ensure the views of all Bougainvilleans are represented.

The main challenges to the ABG are the institutional capacity of the ABG Department of Mining, preparations for and the conduct of negotiations; funding estimated at K15 million a year that donors are helping with and Bougainville mining legislations.

Joseph Pangkau concluded with a few significant remarks about Bougainville history. He said that, since the Panguna uprising, it is evident that companies throughout the country are putting more emphasis on their social license to operate.

The ABG wants to make sure that, this time around, affected and impacted landowners play a key role in decisions about the mine.

All Bougainvilleans need to know what is going on and have an opportunity to express their views and concerns.

He said that, due to the conflict, the current process is unique and complex. Valuable lessons have been learned. With the right information; Bougainvilleans will reach a decision on the future of the mine.


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Peter Kranz

Well I haven't seen the film yet of course, but the book is one of my all-time favourites, and apart from Hugh Laurie, the actors are mostly local Bougainvilleans.

And when the film premièred at the Toronto Film Festival last year it received rave reviews.

So I reckon there's a film legend in the making.

Here's more from the premiere. (A bit lovey though)


Leonard Roka

Sturm - The rate at which BCL was operating before 1990 was a rate that catered for the PNG economy. Now, I for one, want the mine if it is to open for the Bougainville economy alone.

That means, we have to down-size the whole operation to suit the Bougainville economy and not the Chinese market boom.

What could we say here...

Just what I have in my mind and I will go home to ask around.

Keith Jackson

I echo Phil's 'wow'. If the trailer is representative of the full product(and the trailer itself is a knock-out), then this will be one brilliant movie.

Phil Fitzpatrick


Peter Kranz

The film Mr Pip opens in Australian cinemas in November. It is set in Bougainville and features Panguna and the conflict, plus the amazing young actress Xzannjah.

Watch it!


Axel G. Sturm

Hi Leonard - The major problems in the past had been that royalties paid by BCL to the landowners had been misappropriated and did not reach the landowners.

It has to be guaranteed in future that this does not happen again.

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