[BITList] Plans to restart Panguna

[John Feltham]

Plans to restart Panguna

FOLLOWING Rio Tinto’s exit, Bougainville Copper has outlined a plan to restart the massive copper-gold Panguna mine in Papua New Guinea.

Kristie Batten <http://www.pngindustrynews.net/author/profile/a24905c3-23b0-4e54-8b04-b32f7ebdc607/kristie-batten> 03 March 2017 05:59 News
 <http://www.pngindustrynews.net/print_article/pngindustrynews/news/1140945/plans-restart-panguna?print=true> 
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Mining <http://www.pngindustrynews.net/category/mining/> Markets <http://www.pngindustrynews.net/category/markets/>bougainville copper <http://www.pngindustrynews.net/tag/bougainville-copper>
The company released an investor presentation this week, putting forward its plans to revive Panguna, which has been suspended since 1989 due to the outbreak of civil war.
 
Bougainville has not had access to the mine since, and the company and Rio have faced allegations and lawsuits regarding their involvement in the conflict, as well as environmental damage.
 
Bougainville said the "new" Panguna would be different and would be developed under the watchful eye of regulator and major shareholder, the Autonomous Bougainville Government (ABG).
 
The company will seek to raise more than $A100 million to complete feasibility studies, but noted that would be difficult at its current share price of 21c, down from around $1.85 in 2011.
 
Bougainville acknowledged that it may have to introduce a strategic partner, given the multi-billion price tag to restart the mine.
 
The company has set a budget of K12.5 million  to resolve the transfer of Rio's remaining 17.4% stake to the PNG government, seek formal support from ABG, secure reserve land and project access, finalise agreements with governments, open an office in Buka, and scope stage one activities by the end of the year.
 
Bougainville is still awaiting formal approval for the renewal of the Panguna licence.
 
A further K25 million will be required to complete a scoping study by mid-2019.
 
A full feasibility study, at an estimated cost of more than K250 million, will be targeted by the end of 2020.
 
A 2016 order of magnitude study considered a 60 million tonne per annum operation, with a possible expansion to 90Mtpa.
 
Capital costs would be $US6 billion for a 24-year mine starting in 2027. The expansion would cost a further $1 billion.
 
Bougainville also this week declared a full-year net loss of K1.6 million, compared with an K18.2 million loss for 2015.
 
At the end of 2015, Panguna had resources of 1.8 billion tonnes at 0.3% copper and 0.34 grams per tonne gold for 5.3 million tonnes of copper and 19.3 million ounces of gold.
A K1.3 million gain on the acquisition of the Rio assets was recorded.
 
Rio announced in June 2016 that it was divesting its 53.8% stake in Bougainville to the PNG government and ABG.


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