JOHANNESBURG (miningweekly.com) – Diversified miner Rio Tinto has transferred its 53.8% shareholding in Bougainville Copper Limited (BCL), which owns the defunct Panguna mine, to an independent trustee, which will distribute the shares to the Autonomous Bougainville government (ABG) and Papua New Guinea government.

Located on the Bougainville island, an autonomous region of Papua New Guinea, the openpit copper/gold mine has been closed since 1989, after an armed conflict between Papua New Guinea and the Bougainville Revolutionary Army.

Rio Tinto copper and coal CEO Chris Salisbury said on Thursday that a review, announced in 2014, had considered a broad range of options for BCL.

“By distributing our shares in this way we aim to provide landowners, those closest to the mine, and all the people of Bougainville a greater say in the future of Panguna. The ultimate distribution of our shares also provides a platform for the ABG and the Papua New Guinea government to work together on future options for the resource,” he stated.

Under the trust deed, the ABG has the opportunity to receive 68% of Rio Tinto’s shareholding, which equated to 36.4% of BCL’s shares, from the independent trustee for no consideration and Papua New Guinea was entitled to the remaining 32%, which equated to 17.4% of BCL’s shares.

The ABG and Papua New Guinea would both hold an equal share in BCL of 36.4% if the transfers were completed.

“This ensures both parties are equally involved in any consideration and decision-making around the future of the Panguna mine.”

Rio Tinto said it would give the required six months’ notice to terminate the arrangement. Although the company would no longer hold any interest in BCL, Rio Tinto said it would continue to meet its obligations under the agreement during that period to ensure an orderly transition in the shareholdings of the company.

BCL chairperson Peter Taylor would resign with immediate effect, but he would continue to be available to provide services to the board during this transition period.