Barrick Gold 8000 feet above sea level: Gary Faulks

During 2007 I visited Porgera on three occasions to assist the Porgera Development Association. Porgera is situated in the highlands PNG. The following item details some of my activities and thoughts regarding the future of the Porgera Valley once the mine closes.

The Highlands remained largely unaffected by Western influence until relatively recent times and even today age-old traditions still persist amid the current intrusion.

Since 1990 the Porgera Valley has witnessed and in fact participated in the operation of a modern large scale mining operation and all its associated activities. The Porgerans quickly learned the art of negotiation as it was a part of the Porgeran way in history.

Porgera Joint Venture mine which is now mainly owned by Barrick Gold of Canada fully understands that a mine must work closely with the locals if it is to have any chance of a long term future. The closure of the Bougainville mine some years ago is adequate testament to this, so considerable effort and cost is directed at the community and community issues.

At Porgera, a Development Association was established by the National Government to administer and implement community aspects of the Mining Agreement including distribution of mining royalties and  implementation of community projects.

Porgeran culture still embraces the “big man” concept where a man who achieves importance wealth and status can take certain liberties within the society without too much fear of retribution. These liberties are quite serious and can include sexual abuse, violence and corruption. Multiple wives are still a reality as is the buying of brides. Sadly the status of women remains low on life’s ladder.

Education completion is poor although improving; health services, housing and hygiene are basic; road access and other services very limited.

Holdups on local roads are quite common and some form of payment is required to those involved to get past. These holdups or roadblocks are carried out by young males usually armed with weapons. This is the Pogeran way.

The desire within the Porgera society is present to improve their lot but the ability to achieve this is often lacking. My consultancy was to provide some training in capacity building and management accountability and to conduct some strategic planning workshops.

My trips to Porgera from Ballina involve a variety of modes of transport: with car to Robina, then airtrain to Brisbane Airport, jet to Cairns and turbo prop to Mount Hagen. Then it is either helicopter or a Twin Otter (same aircraft and in fact same company as the recent air tragedy in PNG) to Kairik and finally Toyota to the mine site.

The Porgera Valley is a dry (alcohol free) area and all bags are searched on the way in to check that you are not bringing alcohol in and they are searched on the way out to check that you are not taking any gold home.

Accommodation at the mine site, including catering by a local contractor, is pretty good. At the elevation of 8000 feet the air is crisp, often fogged in and rain showers common place. However very often the days are sunny and clear but can change quickly. Security at the mine site is high as local unrest is commonplace. Killings can still occur in tribal and family clashes.

The mining operation commenced in 1990 as an underground mine to extract the high grade ore first and over one million ounces per year were produced during those first couple of years. Later the mine became mainly open cut.

Because the gold is securely embedded within sulphides, a fairly new and exacting process was developed to achieve satisfactory extraction. The process involves pressure oxidisation via giant onclaves before a chemical extraction process using cyanide.

The resulting waste is said to be neutralised before release in to the environment but because the material has been reduced to a powder during processing, the waste is quite unstable and can not be dried out or stockpiled. As a result the downstream effects are closely monitored.

The pressure oxidisation consumes huge amounts of electricity and the mine has developed a power station some 70 km away using local gas and diesel turbines.

The mine employs over 2000 staff who are principally PNG Nationals but around 200 expatriates are operating on a fly in-fly out basis from Australia. The Porgerans oppose the fly in-fly out arrangement as they would have preferred that a large mining town with associated facilities (like at Ok Tedi) had been built but one of the early problems with this idea was the absence of a suitable site within the mountain areas which are unstable and steep.

Substantial local housing has been developed at the mine locality as well as many community facilities.

Providing the price of gold remains fairly stable and maybe increases, the mine will continue for some years but this is always subject to the gold content within the material being satisfactory. Total production costs for gold is currently around $600 per ounce. The 2010 price is around $1200US per ounce.

Ultimately the mine closure will bring its own problems as the locals face the prospect of life without the mine and its huge income and employment.

Avenues worthy of consideration include development of tourism as the mine facilities would adapt readily to that type of activity but additional infrastructure would  be needed.

Security, particularly on rural roads, is a problem as is easy access but it could be envisaged that this could be part of the experience for some types of adventure tourism involving outdoor activities and visits to cultural areas.

In the final analysis, the locals may prefer to revert to a less intrusive and traditional way of  life and this is a choice that requires much discussion by them.