Volume 9 Edition 3 2012 - The ASIA Miner

Papau New GuineaMRA has recently published production figures for 2011 for gold of3.2 tonnes and 1.12 tonnes of silver.Mining’s transitory stage continued in 2011. Hidden Valley is still theonly new mine but the additional production from this mine may notfully compensate for the reduction caused by Ok Tedi’s planned declineand production problems experienced at Lihir and Porgera in2011. Total gold production fell to an estimated 60 tonnes meaningPNG will most probably not remain the world’s 11th largest gold producerwith both Argentina and Mexico likely to move above PNG. TheRamu nickel project has experienced continued delays and is expectedto come on stream in 2012 despite good progress in 2011.Mining-sector development acceleratesWith so much activity on exploration pr ojects throughout PNG inthe past three or four years, it is hardly surprising that an increasingnumber have reached feasibility-study stage. Add to that the continuedstrength in commodity markets, and companies are makingsure that study parameters reflect current, rather than overly conservative,market conditions.As an example, in November 2011 Xstrata Copper and Highlands Pacificannounced a delay in completion of the feasibility study on theirFrieda River project to give them time to access alternative power-supplyoptions. In December, the PNG government was reported to have giventhe go-ahead for a natural gas-fired power plant that could supply bothFrieda River and the existing Ok T edi mine, thereby providing a lowercostand quicker alternative to developing a new hydro-electric powersource. The delay means the study is now scheduled for pr esentationat the end of 2012, building on the October 2010 pre-feasibility report,which indicated the viability of a 20-year open-pit operation annually producing190,000 tonnes of copper and 280,000 ounces of gold.Meanwhile, the Morobe Mining joint venture between Harmony Goldand Newcrest has a pre-feasibility study on Wafi-Golpu scheduled forcompletion in mid-year, with early designs outlining a large-scale blockcavingoperation. Resources at Wafi-Golpu are estimated at more than9 million tonnes of copper and 26.6 million ounces of gold. And at Yandera,Marengo Mining is finalizing its feasibility study for the copper-molybdenum-goldporphyry project with technical support fr om ChinaNonferrous, and the PNG state company, Petromin, having agreed totake a 30% investment stake.Earning-in in earnestIn late 2011, Frontier Resources and Ok Tedi Mining began drilling ontheir joint-venture gold project at Bulago in the Highlands, and at Esis,part of Frontier’s Likuruanga gold-copper project in east New BritainIsland. Drilling at a third prospect where Ok Tedi Mining is earning a holding,Leonard Schultz in West Sepik province, was also scheduled.Meanwhile, in January Barrick Gold completed its US$20 million expenditurecommitment to earn a 72% interest in Coppermoly’s Simuku,Nakru and Talelumas copper-gold prospects on New Britain. The twocompanies have formed a joint venture to continue evaluation of theseproperties, where current estimates suggest that Simuku has a 200million tonne inferred resource containing some 700,000 tonne of copper.Coppermoly reported that drilling had identified mor e than 1000metres depth of copper mineralization ther e, while a hole at the Misiliprospect returned nearly 400 metres of copper mineralization, plus showingsof molybdenum and silver.May/June 2012 | ASIA Miner | 47