Porgera Gold Mine’s Future Hangs by a Thread as Reserves Could Run Dry in 10 Years: The Fate of a Nation at Stake

The Precarious State of Porgera Gold Mine’s Reserves

The Porgera gold mine, located in Enga, Papua New Guinea (PNG), is facing an uncertain future as experts warn that its gold reserves may only sustain operations for the next 10 years. As the Kumul Minerals Holdings Ltd (KMHL), a national mining company holding a 51 percent stake in the mine, discloses the alarming truth, the fate of an entire nation’s economy hangs by a thread.

Barrick Niugini Ltd’s Crucial Role and Strained Agreements

Barrick Niugini Ltd (BNL), the majority owner of the Porgera gold mine with a 49 percent stake, has played a critical role in supporting the mine’s care and maintenance costs. However, tensions arise as KMHL reveals that all exploration results during the care and maintenance period belong to BNL, leaving the task of proving up the next 10 years’ resources to be accomplished within the initial operational years.

According to KMHL Chairman Dr. Ila Temu, Barrick has presented a profitability model for the mine, forming the basis for the agreed benefit split. KMHL’s 36 percent share over the next decade will be allocated towards repaying BNL’s care and maintenance expenses. This arrangement spares KMHL from borrowing funds to cover its 51 percent share, which would have incurred high interest costs in the market.

Despite the strained agreements, Temu assures that other stakeholders will receive their dividends. The Enga government, represented by Minerals Resources Enga, holds a 5 percent stake, while the landowners have a 10 percent stake in the Porgera gold mine.