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Papua New Guinea Baseline Study

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Papua New Guinea Baseline Study Mining, Minerals and Sustainable Development October 2001 No. 180 Papua New Guinea Baseline Study Glenn Banks University of New South Wales, Australia This report was commissioned by the MMSD project of IIED. It remains the sole Copyright © 2002 IIED and WBCSD. All rights reserved responsibility of the author(s) and does not necessarily reflect the views of the Mining, Minerals and MMSD project, Assurance Group or Sponsors Group, or those of IIED or WBCSD. Sustainable Development is a project of the International Institute for Environment and Development (IIED). The project was made possible by the support of the World Business Council for Sustainable Development (WBCSD). IIED is a company limited by guarantee and incorporated in England. Reg. No. 2188452. VAT Reg. No. GB 440 4948 50. Registered Charity No. 800066 1 Contents List of Figures...................................................................................................... 5 List of Tables....................................................................................................... 5 Acknowledgements and Additional Inputs ....................................................... 5 Acronyms ............................................................................................................ 6 Kina Conversion Rates ....................................................................................... 7 Part One: Introduction ...................................................................................... 9 1.1 Introduction .................................................................................................................. 9 1.2 Research Aims and Objectives...................................................................................... 9 1.3 Methods ...................................................................................................................... 10 1.4 Report Outline ............................................................................................................ 11 Part Two: The Papua New Guinea Minerals Sector....................................... 12 2.1 Introduction ................................................................................................................12 2.2 A Brief History of the Papua New Guinea Minerals Sector........................................ 12 Key Sources................................................................................................................................14 2.3 The Current Mining Industry in Papua New Guinea .................................................. 14 Current Mining Operations......................................................................................................15 Porgera.......................................................................................................................................15 Lihir.............................................................................................................................................16 Ok Tedi.......................................................................................................................................16 Misima........................................................................................................................................18 Tolukuma ...................................................................................................................................19 Small-Scale Mining....................................................................................................................19 Exploration.................................................................................................................................20 Ramu Nickel...............................................................................................................................20 Kainantu.....................................................................................................................................21 Hidden Valley/ Hamata.............................................................................................................21 Wafi ............................................................................................................................................21 Resource Estimates ...................................................................................................................21 Frieda/ Nena ..............................................................................................................................22 Resource Estimates ...................................................................................................................22 General Comments ...................................................................................................................22 Stakeholders ..............................................................................................................................24 Mining Corporations.................................................................................................................24 The National Government........................................................................................................25 Local Communities....................................................................................................................25 Provincial Governments............................................................................................................25 Local Level Government (LLG) and Institutions.....................................................................25 The broader Papua New Guinea Community ........................................................................26 Employees (Local, National and International)......................................................................26 Non-Governmental Organisations (NGOs) (National and International) ...........................26 Suppliers (local, national and international)...................................................................................27 Sources .......................................................................................................................................27 2.4 Economic Issues.......................................................................................................... 27 Formal measures .......................................................................................................................27 Government Revenues ..............................................................................................................30 2 Papua New Guinea Baseline Study Employment...............................................................................................................................33 Sources .......................................................................................................................................33 2.5 The Current Regulatory and Policy Framework......................................................... 34 Fiscal Regime .............................................................................................................................36 Sources .......................................................................................................................................38 2.6 The Small-Scale and Artisanal Mining Sector .............................................................. 38 Sources .......................................................................................................................................39 Community Issues............................................................................................................. 39 Community in Papua New Guinea ..........................................................................................39 Mechanisms for Community Consultation and Participation ...............................................41 Community Change and Transformation................................................................................42 Economic Impacts .....................................................................................................................43 Social Impacts............................................................................................................................46 Political Impacts........................................................................................................................48 Cultural Effects..........................................................................................................................49 Community Attitudes Towards Mining....................................................................................50 Sources .......................................................................................................................................52 2.8 Environmental Effects of Mining ................................................................................. 52 General Comments ...................................................................................................................52 Environmental Issues.................................................................................................................52 Ok Tedi.......................................................................................................................................55 Porgera.......................................................................................................................................56
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