Barrick says PNG govt's refusal of lease extension will be costly

The multi national miner at Porgera in Papua New Guinea, Barrick, said the government's refusal to extend its Special Mining Lease will have far reaching effects.

The company, in a statement, said it would cause significant harm to the local, provincial and national economies.

It claimed the refusal and nationalisation of the Porgera mine assets presented enormous financial and reputational risks for local communities and businesses, the regional economy and the country as a whole.

The company also said it believed transition arrangements spoken of by the government, with the mine remaining in production, may not be possible under law, and under the circumstances, the company had been forced to suspend operations.

It said the suspension was likely be extremely costly, compounding PNG's national debt challenges, and potentially resulting in the permanent loss of the mine.

The company pointed out that the Porgera gold mine in Enga Province had been a major strategic asset for the country for many years, contributing approximately 3.8 percent of current GDP, and for the past 30 years had provided about 10 percent of PNG's average annual export income.

In addition it said it had paid billions in taxes to the government, along with royalties to the landowners and provincial government, and much more into the wider economy.

On Friday the PNG government said it has carefully considered the issue and decided it was "in the best interests of the State, especially in lieu of the environmental damages claims and resettlement issues", that the lease not be renewed.

World won't end - PNG PM

James Marape said the world would not end if the Porgera Mine in Enga shut down.

Mr Marape called for all Papua New Guineans to bear with him.

"We can endure short term pain for long term gain. Don't be cry babies and pessimists, because the world will not end if Porgera closes."

He told people it was "2020 not 1975, no one else will work for you or us, PNG, we have to do it ourselves."

Mr Marape said the people should return to agriculture, forestry and fisheries.

He said the world needed healthy organic food, coffee, copra, cocoa, vanilla, livestock and fish.