Perth-based explorer Kalia Ltd has begun geological surveys on its two licence areas, after winning exploration licences under the new Bougainville Mining Act. Managing Director Terry Larkan tells Business Advantage PNG that, while the licence areas’ resources are unknown, the licences have ‘the right address’.

Map of Kalia’s operations. Source: Kalia

Kalia, along with landowner company Toremana, was awarded the exploration licences after the Autonomous Bougainville Government lifted a mining moratorium in May 2017.

The licences cover about 20 per cent of the Mt Tore region of North Bougainville Island and are located about 60 kilometres from the Panguna mine, where an indefinite moratorium on mining is in place.

The area over which Kalia holds contractual rights is known as the Mount Tore Project.

Australian Securities Exchange-listed Kalia has two other exploration projects underway in the Kimberley region of Western Australia, and in the Northern Territory. Its largest shareholder (14.5 per cent) is founder Nicholas Zuks. The company chairman is former Australian Defence Minister, David Johnston.

‘We have no idea of its value, but we are as comfortable as you can be that we are in the right address.’

‘It’s a very exciting time,’ Kalia’s Managing Director Larkan told Business Advantage PNG.

Kalia’s Terry Larkan. Source: Kalia

Virgin territory

Larkan says that unlike Panguna, whose resources are known, Kalia’s licence areas are ‘highly prospective virgin territory from a professional exploration perspective’.

‘We have no idea of its value, but we are as comfortable as you can be that we are in the right address from a number of aspects. Our work focus now is to find something that is economically and socially viable.’

He points out Bougainville is located on the Pacific ‘Ring of Fire’ tectonic plates margins which has produced massive gold and copper resources at Lihir, Ok Tedi and Panguna.

Two reports in the 1980s identified two copper and gold deposits in the northern region of Bougainville. Kalia has since reprocessed that raw data, concluding the area is ‘brimming’ with potential.

Significant potential

A statement to the ASX said the company is ‘confident there will be major additional discoveries made once systematic, modern exploration is undertaken’ and that there is ‘significant potential to identify additional targets on the West where no geophysical data exists but historic rock chip, soil and river sample indicators have been found’.

Kalia’s Chief Geologist, Peter Batten, Paramount Chief Robinson Amesi, Kalia shareholder, Nik Zuks (l-r) Source: Kalia

Under the Bougainville Mining Act 2015, mineral rights are vested in the hands of customary land owners. Kalia has teamed up with local landowner company, Toremana Resources Ltd, which holds a 25 per cent shareholding in the licences, with free carry through to production.

‘The state provides the regulatory framework and access is given by landowners,’ says Larkan.

He says the government and landowners are ‘sticklers’ for ensuring the process leading up to the start of geological exploration surveys is carried out in line with the intent of the legislation.

It is the first time the process had been used and it requires ‘a lot of patience at times’ when there are delays in planned timelines.

Local landowners, he says, are ‘extremely supportive’ of the project.

The first geological survey using the Landowner Access Agreement is underway.

Bougainville’s Treasury and Finance Minister has told The Loop the moratorium has been lifted in two other areas: Isina in Central Bougainville and the Arawa-Panguna area.

Panguna moratorium

Meanwhile, 60 kilometres south of Kalia’s tenements lies the Panguna copper and gold mine, over which the Bougainville government has declared an ‘indefinite’ moratorium on any exploration or mining.

The Panguna mine

In a media release, President John Momis said the decision to declare a moritorium followed December’s Warden’s meeting, when there was ‘a narrow divide between those supporting the mine to be opened by Bougainville Copper Ltd (BCL) and those that oppose it’. He added that it would be ‘untenable under current circumstances’ for any developer other than BCL to develop the mine.

Those opposing BCL’s involvement are led by Philip Miriori, who is claiming chairmanship of the Special Mining Lease Osikaiyang Landowners’ Association. Court mediation continues.

The 367 authorised customary heads of the 510 blocks of land within the special mining lease area of Panguna have since said they do not recognise Miriori as the chairman of the Association, reports The Post-Courier.

In a statement, the landowners said Miriori did not represent them and was trying to advance the interests of ‘disruptive third parties’.