Former Papua New Guinea prime minister, Peter O'Neill says the country could become a tinpot dictatorship if James Marape "nationalises" the Porgera mine.
Porgera gold mine. Photo: Richard Farbelini at English Wikipedia / Public domain
This follows a Supreme Court decision last Friday which denied Barrick Nuigini a stay on a decision over the non-renewal of its special mining licence.
Late last month the PNG government issued the lease at Porgera to state-owned company, Kumul Minerals Holdings.
Marape said he wanted the mine opened, and that under the mining development contract the government had the right to obtain the assets at a fair market value.
The National newspaper reported the government said that, one year after the licence expiry, it would be entitled to take all the assets without any cost to the state.
But O'Neill said the government must observe the rule of law.
Peter O'Neill Photo: Supplied
He said nationalising Porgera was akin to the actions of the Chavez government in Venezuela which he said left that country a basket case, despite being resource-rich.
Marape denied claims his government was nationalising or even expropriating the Porgera mine.
He said companies including Barrick had enjoyed an unbroken and profitable run in operating the mine for 30 years before the lease expired.
The Mining Advisory Council refused to renew the lease of Barrick and its joint venture partner, Chinese company Zijin.
Following this, in compliance with the Mining Act, the state issued notice to procure Barrick's asset with a view to reopening and operating the mine as soon as possible, Marape explained.
He said the government had offered Barrick an opportunity for partnership in the future running of the mine, but under new terms.
The prime minister welcomed the Supreme Court decision, urging Barrick to "humble itself, observe the rule of law and fulfill its residual obligations" under its Mining Development Contract.
Papua New Guinea's prime minister James Marape. Photo: PNG PM Media Unit