1. CASM – Ulaanbaatar, Mongolia - 2007
Development Synergies between Large Scale and Small Scale Mining in Papua New Guinea
CASM – Ulaanbaatar, Mongolia

2. Papua New Guinea

3. Mining Projects

4. Large Scale Mining
3 Large scale Mines + 2 under construction and two in feasibility, 1 recently completed closure
3 Medium Scale Mines + 1 under construction
Mining single largest export earner
Only minerals mined are Copper & Gold/Silver

5. Small Scale Mining ASM = Small Scale Mining
Estimated 50,000 miners countrywide
4.5 tonnes (145,000 oz) gold produced each year
Kina 180 million (US$ 60 million)
Average income per miner is K3600 (US$1080)
PNG average income is K994 (US$300)
Mining improves income - reduces poverty
Approx. 400,000 benefit (PNG multiplier=8)

6. Indigenous land rights recognized in 1884.
Minerals owned by State
Today 97% of land is still owned by indigenous people. 3% by Government.
PNG unique.
Small scale mining is well regulated as a consequence of the country’s mining history, development of its mining law and very strong customary ownership rights to land.

7. Mining Act has grown from a framework to regulate small scale mining to accommodate large scale mining.
Mining Act currently under review.
Small scale miners seek more regulation

8. MINING TENEMENTS Exploration licences Alluvial Mining Leases
Mining Leases (Tribute Agreements)
Other support leases
- Lease for Mining Purposes
- Mining Easements

9. EXPLORATION LICENCE
Any size up to 2,500km2
Holder has first right to apply for mining tenement
Landowners consulted prior to grant
Technical and financial conditions
Granted for 2 years years
Maximum term 15 years

10. INDIGENIOUS RIGHTS
Right to mine on own land if non- mechanized Alluvial Gold only mineral mined
ALLUVIAL MINING LEASE
Alluvial Mining Lease required if mechanized
AML – 5 ha. Amalgamation of up to 5AML’s
Other landowners consulted prior to grant
Granted for 5 years
Limited conditions attached to AML

11. MINING LEASE
Hardrock Mining only up to 60km2
Covers any size : Small-Medium-Large scale
Granted for life of mine
Extensive consultation process prior to grant
All stakeholders involved
State (National, Provincial, Local) Company, Landowners, and impacted communities

12. Community Benefit Package – MOA Mostly from Govt
Community Benefit Package – MOA Mostly from Govt. Royalty of 2% Infrastructure, Health, Education and Future Generations Trust Company – spin-off businesses, employment preferences, community projects Projects selected by communities Compensation Agreement with ML landowners

13. TRIBUTE AGREEMENTS
Lease holder reaches agreement with a miner or contractor to mine on the lease for a percentage of the gold (normally 15%)
Registered under Mining Act
Benefits both Leaseholder and contract miner

14. Community Reporting Obligations
Mine Closure Planning
Conceptual at start of mining
Reviewed regularly
Implemented 5 years prior to closure
Aimed at Community Security post mine
Projects implemented during mining must be sustainable after closure.
Community Reporting Obligations

15. MISIMA MINE

16. Relationships between Tenements
Prior existing AML’s or ML’s excluded from Exploration Licences (EL)
Compensation payable to prior Leaseholders but not to post EL leases
AML’s can be granted within EL with permission of EL Holder
AML transparent for Hardrock exploration
30 day period between new EL applications to allow lease applications.

17. PNG process is open and transparent
Prior informed consent for all tenements
Landowners are great supporters of mining resource developments
Benefits which flow to Communities is public
Use of resource revenues by Government less transparent
Process tested and modified over 30 years since Independence and it works.

21. Faces of PNG