The newly-appointed head of the Bougainville landowners group is cautiously optimistic that work to re-open the giant Panguna copper and gold mine could begin within two years.

Lawrence Daveona is the new chairman of the Umbrella Panguna Landowners Association (UPMALA), which represents six landowner groups. The groups have jointly drawn up conditions required for talks on re-opening the mine. The Panguna mine has lain idle since 1989 following extensive civil unrest.

Three years ago, the newly elected President of the Autonomous Region of Bougainville (ABG), John Momis, declared the mine had to reopen in order to enable Bougainville to sustain its economy in preparation for an independence referendum due between 2015 and 2020.

Pre-conditions

The landowners’ pre-conditions for talks to begin include

• The acquisition of the mine licence by local landowners, represented by the SML Osikaiang Association
• Funding for a traditional reconciliation process
• 10 billion kina (US$4 billion) compensation
• Funding support for UPMALA and its six affiliated associations to enable them to function as legitimate organisations
• Resettlement of, and help for, landowners displaced during the Bougainville conflict

Daveona has told Business Advantage PNG that the landowners’ would be seeking to obtain the licence for the mine area itself, believing Rio Tinto subsidiary Bougainville Copper Limited’s rights to the mine have expired.

Compensation claim

He also said landowners have also not retreated from late rebel leader Francis Ona’s demand for 10 billion kina (US$4 billion) compensation as a part of his team’s pre-condition talks.

Daveona said this is not a demand for cash up-front from Rio Tinto or BCL, but the detail ‘is being worked out and is not finalised yet.’

Daveona quoted Momis as saying talks would begin in November this year, but before that could happen, there were a number of outstanding issues, including sufficient funding from the Bougainville and National governments for UPMALA and the six Landowner Associations to operate independently from the ABG. There is a concern that landowners’ issues may be watered down if they are co-opted as a partner of ABG in the negotiations.

He said work on rehabilitating the mine could possibly begin in 2015.

BCL responds

Peter Taylor, Chairman of Bougainville Copper Limited, told Business Advantage PNG that he welcomed the formation of the umbrella group and congratulated Daveona on his election.

‘At this stage, BCL is working on the basis that the Bougainville Copper Agreement is still in place,’ he said.

Under the agreement, BCL has an automatic right to a 21-year renewal of the mining lease at Panguna.