PNG Prime Minister Peter O’Neill is warning his government might not extend the life of the mine, once licenses expire later this year, unless BHP agrees to some changes to the terms of ownership. O’Neill has also requested assurances over environmental safeguards.
Environmental issues plagued the project in the 1980s, and the Australian miner reported that mining operations had caused major environmental damage to the Fly River in 1999.
Ownership of the operation was then restructured with BHP’s 63.4 percent stake placed in the PNG Sustainable Development Program (PNGSDP).
The governments of PNG and Western Province hold the remainder of the balance in PNGSTD, a trust headed by economist Ross Garnaut. The trust effectively indemnified BHP Billiton against environmental damage while PNGSTD acted as the mine’s operator.
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