Partners in Ok Tedi come to terms

Press, 7 August 1985, Page 35

Partners in Ok Tedi come to terms

NZPA-AAP Port Moresby The Papua New Guinea Government and its private partners in the giant Ok Tedi gold and copper project — led by the Broken Hill Proprietary Company, Ltd — have agreed on future operations. Announcement of the agreement was made in a statement by PNG Minerals and Energy Minister, Mr Francis Pusal. The mine, on the rugged PNG-Irian Jayan border, was re-opened in March on an interim basis allowing mining of the gold cap to continue after PNG ordered the mine to shut in February in a dispute over development by the operating company, Ok Tedi Mining, Ltd. If the economic criteria — mainly relating to capital costs and international prices — are met the company will be required to increase copper ore processing by 50 to 100 per cent from about 30,000 tonnes a day. The agreement provides for OTML to install copperprocessing equipment with

a daily ore capacity of 30,000 tonnes by 1988. OTML is processing 22,500 tonnes of gold ore a day and expects production to stabilise at 64,000 ounces a month by next January, according to the company. Provision had been made for talks to continue between the PNG Government and the Australian, American and German shareholders until February 28 next, a Minerals and Energy Department senior official, Mr Bill McCann, said. This would be to seek consensus on a number of outstanding issues, including a Government proposal backed by the company to transfer OTML’s SUS7SOM (5NZ1425M) debt to the books of shareholders, he said. Provision for a permanent tailings dam at a cost of more than SUS2OOM (JNZ3BOM) also is set out in the agreement. But the American head of OTML, Mr Roy Shipes, said he would try to convince the Government to change the agreement in the discussion period to aliow for a cheder option.