Barrick Gold faces compensation claim for Porgera gold mine in Papua New Guinea

19 March 2015 (Last Updated March 19th, 2015 18:30)

Barrick Gold and its subsidiary Barrick Niugini are facing claims about social, economic and environmental damages caused by the Porgera gold mine in Papua New Guinea.

Porgera Gold Mine

Barrick Gold and its subsidiary Barrick Niugini are facing claims about social, economic and environmental damages caused by the Porgera gold mine in Papua New Guinea.

Justice Foundation for Porgera (JFP), an entity representing landowners in the Porgera region in north-western Papua New Guinea (PNG), has submitted a position statement outlining losses incurred.

The organisation is seeking billions of dollars in compensation on behalf of landowners from Barrick Niugini through the claims.

According to the position statement provided to both Barrick Gold Corporation Canada and Barrick Niugini on 24 February, landowners' subsistence and livelihoods changed as the rate of open pit mining doubled the level originally agreed in the 1989 MDC.

JFP's statement further noted that the mine had breached agreements on environmental standards, relocation of displaced landowners and the number of fly-in, fly-out workers in the region.

"The mine had breached agreements on environmental standards, relocation of displaced landowners and the number of fly-in, fly-out workers in the region."

As part of the company's broader debt reduction plan, including the sale of assets in Australia, Barrick recently announced its intention to sell its interests in Papua New Guinea.

Credit Suisse was engaged by Barrick Niugini to find an external buyer for its 95% share in the Porgera mine, as well as other interests in Papua New Guinea and Australia.

Mineral Resources Enga (MRE) owns 5% of the mine in trust for the landowners, with the Enga Provincial Government.

MRE chairman and director Kurubu Ipara said that the company will divest its interests without proper notice and exit PNG, leaving the landowners with a new owner.


Image: Porgera Gold Mine is a gold and silver mining operation in the Enga province of PNG. Photo: courtesy of Richard Farbelini.