Rio Tinto gives golden gift of rights to Papua New Guinea mine worth $51bn

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Mining giant Rio Tinto has given away a 54% stake in a copper and gold mine which potentially has $51 billion (£38 billion) in reserves.

The Bougainville mine is in Pangua, Papua New Guinea and work there was abandoned in 1989 after miners were attacked during a local uprising. It was one of the world’s largest open-cast mines and had begun operating in 1972.

At one stage it accounted for more than 40% of Papua New Guinea’s economy but two years ago the local provincial government passed laws which affected the ownership of mining rights and led to a review of the business by Rio. 

Today, Rio — led by Sam Walsh, who retires next month — said it was handing its stake to trustees who would then pass the shares on equally to the Autonomous Bougainville Government and Papua New Guinea national government. 

Chris Salisbury, Rio’s copper and coal chief executive, said: “By distributing our shares in this way we aim to provide landowners, those closest to the mine, and all the people of Bougainville a greater say in the future of Panguna. It also provides a platform for the ABG and PNG government to work together on future options for the resource.”

Analysts reckon its could cost up to $4 billion to put the mine back into operation. Bougainville is listed in Australia and the shares jumped 55% to 31.1 cents valuing it at just A$124 million (£68 million).

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Source Article from http://www.standard.co.uk/business/rio-tintos-gives-golden-gift-of-rights-to-51bn-papua-new-guinea-mine-a3284876.html

June 30, 2016 |
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