12 Apr Barrick settles year-long stand-off with PNG government over Porgera gold mine
A year-long stand-off between Barrick Gold and Papua New Guinea (PNG) has come to an end after the world’s second largest gold producing company agreed to give the country’s government a majority stake in the Porgera gold mine.
The agreement creates a new joint venture in which PNG stakeholders will have a 51% stake and Barrick Niugini Limited (BNL) 49%, with the latter remaining as the operator. BNL is comprised of Barrick and its Chinese partner Zijin Mining.
The framework also sets a 53:47 split between PNG stakeholders and BNL in economic benefits generated over the life of the mine, with BNL providing the capital to restart the mine.
Porgera has been on care and maintenance since PNG Prime Minister James Marape refused to renew Barrick and Zijin’s mining licence in June 2020.
After the framework was announced last week, Marape called it ‘a historic development’ that will set a benchmark for further resources projects in the Australasian country.
“I thank [Barrick CEO Mark] Bristow and his team for recognising our nation’s aspirations and their willingness to partner with us in realising this vision at Porgera,” said the Prime Minister.
Barrick has also agreed to an exit option at Porgera, giving PNG the right to acquire the remaining 49% of the mine from BNL at fair market value after 10 years.