THE MADANG GUIDEUNES ApPENDIX Offshore Minerals Policy Workshop Report SOPAC Miscellaneous Report 323 SOPACMisceilaneoHsReport 362 35 OFFSHORE MINERALS POLICY WORKSHOP 22-26February 1999 Madang,Papua New Guinea SOPAC Miscellaneous Report 323 Revised Edition December1999 [2] ACKNOWLEDGEMENT The Offshore Mineral Policy Madang Guidelines became a reality owing to the invaluable contributions of several committed organisations and individuals. We wish to acknowledge the Department of Mineral Resources, PNG for hosting the workshop; the Metal Mining Agency of Japan and the Forum Secretariat for sponsorship. Our gratitude goes to the authors of the papers who set the tone and developed the eclectic framework for the discussions. A special word of mention to Dr. Allen Clark, East West Center, Hawaii for playing a key role during the conference and helping compile and edit the papers. SOPAC is proud to have co-ordinated the workshop and to present the Offshore Mineral Policy Madang Guidelines. [3] TABLE OF CONTENTS Introduction 5 Workshop Recommendations 6 Addresses and Presentations Welcome Address 8 Kuma Aua Opening Address 9 Toyo Miyauchi CHAPTER ONE: MARINE MINERAL RESOURCES Offshore Mineral Resources Potential of Pacific Nations 11 Allen Clark Marine Hydrothermal Mineralisation in the Lau and North Fiji Basins 20 Bhaskar Aao Overview of Papua New Guinea Offshore Resources 31 Paul Kia and Joseph Lasark The Mineral Wealth of the Bismarck Sea 37 Raymond Binns and David Dekker The Offshore Mineral Resources of the Cook Islands 41 Ben Ponia CHAPTER TWO: MARINE MINERAL POLICY, LEGISLATION AND GOVERNANCE The International Seabed Authority and the Development of the Seabed Mining Code 44 Michael Lodge Marine Mineral Policy Considerations for the Pacific Island Nations' Exclusive Economic Zone 50 Allen Clark Introduction to the Papua New Guinea Green Paper on Offshore Mining Policy 57 James Wanjik Fiscal Policy and Regime for the Economic Development of Offshore Mineral Resources 61 Allen Clark [SOPAC Miscellaneous Report 323 -Revised Edition] [4] CHAPTER THREE: MARINE MINERAL DEVELOPMENT Industry, Research and Government 68 Julian Malnic Licensing Regime in Papua New Guinea 74 Nellie James Stakeholder Issues in Papua New Guinea 78 Francis Lola Papua New Guinea Fisheries and Marine Mineral Development 82 Ursula Kolkolo CHAPTER FOUR: MARINE ENVIRONMENTAL ISSUES Environmental Impact Assessment for Deepsea Mining 90 Charles Morgan Review of Japanese Activities on Manganese Nodule Development and Marine Environmental Preservation 96 Yuji Kajitani Summary of the Japanese Environmental Study for Manganese Nodules Development 104 Hirohiko Tesishima Environmental Regime: Papua New Guinea Case Study 115 Katrina Solien END SESSION Closing Address 119 Hon. Masket Langalio CPE APPENDICES Appendix 1: Revised PNG Offshore Mining Policy Green .Paper 121 Appendix 2: Participants 132 [SOPAC Miscellaneous Report 323 -Revised Edition] [5] INTRODUCTION The Offshore Mineral Policy Workshop (hereinafter "the Workshop") was held between 22-26 February 1999 in Madang, Papua New Guinea. The Workshop was hosted by the Papua New Guinea (PNG) Department of Mineral Resources, coordinated by the South Pacific Applied Geoscience Commission (SO PAC) and sponsored by the Metal Mining Agency of Japan (MMAJ) and the South Pacific Forum Secretariat. The need for this Workshop to discuss issues surrounding offshore mineral development was initially discussed between the Papua New Guinea Department of Mineral Resources (DMR), SOPAC, MMAJ and other experts in July 1997. In addition, the discussions surrounding the need for more understanding of offshore mineral development issues resulted from two applications to PNG for marine exploration licences in the Manus Basin area of the Bismarck Sea by Nautilus Minerals Corporation limited (hereinafter "Nautilus"). The Papua New Guinea Government granted Nautilus the exploration licences in November 1997. As part of the background work on building institutional competency to regulate offshore mineral development, the PNG Government determined that the Mining Act of 1992, which is the current mining legislation governing onshore mineral development, was inadequate to deal with offshore mineral development. In March 1998, an inter-agency committee within PNG was convened to formulate a policy framework for offshore mineral development. This policy framework for PNG was developed in an Internal Workshop on Seabed Mining from 31 August -02 September 1998 in Port Moresby and resulted in a draft PNG Green Paper on Offshore Mining Policy (hereinafter "Green Paper"). This Workshop combined national, regional and international expert presentations with working group sessions and plenary discussion. One primary goal of the Workshop was to solicit comments and obtain input from international experts on the draft PNG Green Paper. The ensuing week's discussion points and proposals were discussed within working groups and used to revise the Green Paper. These revisions were then debated in the concluding session and agreed upon by the Workshop participants. The revised Papua New Guinea Green Paper is attached hereto as Appendix 1. This revised Green Paper is intended to undergo further development and refinement by the PNG inter-agency committee on offshore mineral policy and ultimately is to be forwarded to the PNG Cabinet of Ministers. Another important goal of the Workshop was to develop a list of recommendations for proposed further work concerning offshore mining policy. To this end, each working group compiled recommendations in written and oral form and each was discussed and critiqued. A final list of 'Workshop Recommendations" was unanimously agreed upon by the participants. These Workshop Recommendations have been used as the basis for the Madang Guidelines for future work concerning national and international offshore mineral policy. [6] OFFSHORE MINERAL POLICY WORKSHOP RECOMMENDATIONS The following Recommendations are not listed in any order of priority. However, recommendations that are generally applicable for international offshore mineral development and the Asia-Pacific region overall are listed first. They are followed by those that would be more applicable to individual coastal states. 1. As appropriate, nations should take relevant measures to ensure the provisions of the 1982 Convention become fully implemented within their jurisdictions. 2. Nations should move forward rapidly to delineate the baselines from which the various jurisdictional zones under the United Nations Convention on the Law of the Sea (UNCLOS) ("1982 Convention") are measured and to deposit the appropriate charts and list of co- ordinates with the United Nations. 3. In the case of potential extensions of the continental shelf beyond 200 nautical miles, these data should also be gathered as soon as possible and the appropriate claims filed (bearing in mind the 10-year limit from the date of ratification by the coastal state). 4. Measures should be taken to designate archipelagic and other sealanes for the purpose of navigation in accordance with the 1982 Convention and other international conventions. 5. Nations should proceed to select their preferred dispute resolution mechanism as required under the 1982 Convention. 6. Nations should develop and promote a consent regime for Marine Scientific Research (MSR) in accordance with the provisions of the 1982 Convention and recommended international standards (e.g. the UN model guidelines on MSR) to ensure that research data and information may be obtained while protecting the confidentiality of investors' data regarding exploration of resources. 7. Recognising the appropriate instruments within the 1982 Convention regarding the conservation and management of the living resources within coastal states' EEls, measures should be taken to minimise adverse impacts to the marine environment and to traditional and non-traditional uses of the sea that may be caused by offshore mining. 8. Where appropriate, coastal states should consider making a declaration that the non-living resources beyond the 3-mile limit from the Provincia! coastlines are a "Common Heritage of the Nation". 9. In the interests of consistency and simplicity of administration, the unique nature of offshore mineral development activities and the diverse nature of stakeholder interests, coastal states should develop a comprehensive 'Offshore Mining Act,' where appropriate, as a distinct country-specific regime which is separate from their existing onland mining acts. 10. To ensure the long term capability of the coastal states to effectively monitor offshore mineral resources activities, relevant government representatives should participate in all at-sea phases of MSR, exploration and evaluation and that provision be made, either through appropriation or the creation of special use funds within the responsible agency(ies), to provide adequate human and fiscal resources required for needed data collection and collation, monitoring and enforcement activities. 11. Coastal states should adopt a proactive approach in all significant decision making activities related to environmental concerns associated with offshore mineral exploration and exploitation. 12. Recognising the unique nature of the biota associated with active hydrothermal zones, activities that ensure an adequate understanding of the biota communities and the impacts of any associated mineral exploration and exploitation should be undertaken by MSR and Industry. [7] 13. The collection