North Fly MP wants new Ok Tedi mine extension agreement

North Fly MP Boka Kondra has called for a totally new agreement if the mine life of giant OK Tedi gold and copper mine in the Western province is to be extended from after 2013.

Kondra noted with grave concern that there were some serious outstanding landowner issues that should be addressed properly before the Ok Tedi mine extension.

He highlighted that important issues to be addressed and built into the new agreement should include:

         Proper genealogical survey with full social mapping identifying all landowner tribes in project and affected areas for adequate compensation, royalties and benefit sharing arrangements;

         18% share equity formerly held by Inmet Mining Ltd to be given to an umbrella company representing all local landowner and affected communities; and

         A comprehensive environmental impact mitigation plan with no further disposal of toxic mine waste, tailings and sediments into the already heavily polluted Fly River system.

Kondra said these were pertinent issues that must be addressed fully by Ok Tedi Mining Company, BHP, PNG Sustainable Development Programme, National and Western Provincial Governments and landowners.

"Ok Tedi is an ecological catastrophe," he said.

"There should be no review or 10th Supplement Agreement, but a totally new agreement.

"Failure to do so will fuel existing tensions and landowner concerns.

"My people's concerns must be addressed. If not, the mine must close in 2013 as originally planned."

His comments followed the recent announcement by Ok Tedi Mining Company that it was examining new pollution controls as part of a feasibility study for a seven-year extension of the mine's life.

Ok Tedi mine started producing gold and copper in 1987 and was originally scheduled to close in 2013, but the company was undertaking a feasibility study to push that out to 2022.

The new mine plan would see output reduced by one-third, to around 100,000 tones of copper and 350,000 ounces of gold a year.

Ok Tedi Mining Limited managing director, Alan Breen has said that the new plan would not be the same as current mining operations.

"It's open cut mining which is quite different to what we are proposing in the future," he said.

"The feasibility study that we are currently undertaking would involve the operation of two small underground mines which produce very little waste and an open-cut operation which would produce a significant amount of waste.

"As part of the study though, we are looking at designing and constructing a stable waste rock dump at the mine which would prevent that waste flowing into the river system so quite a substantial change from our current practices."

The extension would create 14 million tones of waste rock.

 Currently waste rock goes into the Ok Tedi River but Breen says he hopes that will change.

"We are looking at designing a stable waste rock dump which would prevent that waste flowing into the river system," he said.

Breen says more engineering work must be done to discover if is the dump is feasible.

Ok Tedi currently generates 20% of Papua New Guinea's gross domestic product.

With big new projects like the PNG LNG project not expected to come on stream until 2014, the extension of Ok Tedi will be an attractive prospect.

Consultations have already begun but Breen says the process has a way to go.

"The process as it currently stands is that our people are currently doing the environmental impact studies and we are well down the track with those, we are probably 75-80 per cent complete on those." he said.

"The next thing we have to do is complete them by the end of October.

"We need to pass this information on to the state and they will have a team of independent advisers who will have a look at the information we have prepared and they will make recommendations and assessments, and provide them to not only government, but the communities.

"On the basis of that feedback, the communities then will have a decision to make on whether or not they can live with those impacts. "

 Breen said the study was to be completed by November 2010.

The company expects to finish consultations with communities and the government by the end of this year.

However, Kondra said in view of the extended mine life, it was imperative for all stakeholders to establish dialogue for a completely new agreement if the mine is to be extended after 2013.