Saturday 15th April 2023
Prime Minister Hon. James Marape says the State and Papua New Guinea will be the biggest winners in the Wafi-Golpu mine in Morobe with a 55 per cent take in the economic benefits of the project.
PM Marape said this after landmark signing of the Framework Memorandum of Understanding between the Independent State of Papua New Guinea and Wafi-Golpu Joint Venture (WGJV) participants Newcrest and Harmony Gold (through their respective PNG subsidiaries).
The occasion was attended by the Governor-General Grand Chief Sir Bob Bofeng Dadae, Governor General, PM Hon. James Marape, Deputy Prime Minister Hon. John Rosso and senior Ministers, as well as Morobe Governor Hon. Luther Wenge and members of his Provincial Executive Council.
PM Marape said PNG would win by way of:
• State and PNG gain 55 per cent of the project economics;
•State equity is at 30 per cent with 10 per cent carried;
•The 10 per cent carried equity will be for Morobe and landowners;
•2 per cent tax for fiscal stability is premium on top of the full 30 per cent tax to be paid;
•Royalty at 3 per cent with no deductions;
•Additional US$394m for social community infrastructure that Newcrest and Harmony are putting on top of Government’s K1.2 billion Infrastructure and Business Development (IBD) grant;
•A local content forum will be held with developers, Morobe Provincial Government and landowners, where Government will be pushing for local content above 80 per cent in construction period all the way to operations;
•Additional profits tax was secured but dividends withholding tax was given away;
•Personal income tax was not treated as company’s contributions, unlike Lihir; and
•Special Mining Lease (SML) will be issued for only 30 months until investors do Front End Engineering Design (FEED) and Final Investment Decision (FID) to qualify them for extension. After FID, then cash call will be required from Kumul Minerals Holdings Ltd (KMHL)equity contributions.
PM Marape said a framework has been established whereby Newcrest and Harmony, and the State – on behalf of the Morobe Provincial Government and landowners, will progress Wafi-Golpu Mine development so that it can start at the very earliest.
“This is a major resource, with substantial gold and copper, which will anchor our country for the next 40 years and beyond,” he said.
“It took us a while to reach this stage, however good things take time. Sometimes, you have to wait for a while to get the best results.”
PM Marape thanked Vice-Minister for State Negotiations, Hon. Jimmy Maladina, who worked tirelessly with State Negotiations Team (SNT) Chairman Dairi Vele and his team – under Mining Minister Hon. Sir Ano Pala – to make the signing possible.’
PM Marape thanked joint venture partner investors Newcrest and Harmony for their positive responses to State positions.
“We look forward to all parties working together to complete all statutory requirements to complete Mine Development Contract and SML,” he said.
“I want to also assure all our landowners and the LLGs, Districts and Morobe Provincial Government that we will complete the full requirements of law in respect to your consultations and meetings.”