Court allows Barrick JV to continue mining at Porgera
The National Court of Papua New Guinea on Friday ruled that the Porgera gold mine – a joint venture (JV) between Canada’s Barrick Gold and China’s Zijin Mining – should continue to operate, while the application to extend its special mining lease is being considered.
The current lease expires on August 16 and the JV partners are looking at a 20-year extension for the mine.
Barrick CEO Mark Bristow and Zijin executive director and senior VP George Fang, who are both in Papua New Guinea to meet with government and landowners over the mining lease, issued a statement on Friday welcoming the court ruling.
The ruling confirmed that Porgera operated under the 1992 Mining Act and was entitled to seek an extension.
Earlier in the day, Barrick said that Bristow had met with newly elected Prime Minister James Marape to discuss the extension of a lease for Porgera, which is one of Papua New Guinea’s largest mines.
Bristow previously said that Porgera was a long-term asset for Barrick and Zijin and that the mine would require “significant capital” to sustain operations. “Without the security of an extended mining lease, it would be difficult to justify further investments in the mine,” he said in February.
The partners each own 47.5% of the highlands' Porgera mine, with the remaining 5% interest being held by Mineral Resources Enga, owned equally by Porgera SML landowners and the Enga provincial government.
Barrick operates the mine, which in 2018 produced 204 000 oz at an all-in sustaining cost (AISC) of $1 083/oz. This year, the mine is forecast to produce 240 000 oz to 260 000 oz at an AISC of $985/oz to $1 025/oz.
Over the last 30 years, Porgera has paid more than 4.3-billion kina (about $1.27-billion) in taxes and royalties to the government and has contributed, on average, 10% of the country’s export income.
It is also one of the largest employers in the country, with more than 3 100 local employees.
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