PNG’S KEY INDUSTRIAL SECTORS
4.1.3 Mining licences and leases All land in PNG, including the seabed beneath the country’s territorial waters, is potentially open to mining activity. Under the Mining Act, the State owns all minerals existing on, in or below the surface of any land or in any water lying within the territory of PNG. The various types of mining tenements (licences and leases) issued under the Mining Act on recommendation from the Mining Advisory Council include: Exploration Licence (EL) A two-year licence that allows the licensee to occupy and explore a specified area. Mining Lease (ML) A 20-year lease that allows the licensee to mine within a specified area. Special Mining Lease (SML) A longer (typically 25 to 40 years) lease issued for larger, more complex projects. Alluvial Mining Lease A five-year lease reserved for Papua New Guineans conducting non-mechanised mining operations on their own land. This can include joint ventures with overseas partners, provided the project is at least 51% owned by Papua New Guineans. Mining Easement and Lease for Mining Purposes Issued explicitly for the development of roads, powerlines, port sites and other associated infrastructure related to a mining project.
4.1.4 P rocess for approving an Exploration Licence Licences are issued by the Tenement Management Branch of the Mineral Resources Authority. Application forms and a Schedule of Fees, Rents, Security and Exploration Expenditure Requirements is available from the MRA website or direct from the MRA head office at Mining Haus in Port Moresby (see address below). Once an application for an Exploration Licence has been received, the MRA checks the Registry of Tenements to ensure the land is available, and reviews additional information provided by the applicant, such as the program of work set out in the application (which should include plans for post-
exploration rehabilitation) and project finances. It also seeks advice from the Department of Environment and Conservation on environmental impact, as stipulated under the Code of Practice for Mining. The MRA will then host a Mining Warden’s Consultation Forum between landowners and other affected people local to the tenement and the exploration company. With 97% of land in PNG held under customary laws, this process is critical. Once the Warden’s forum has been held and all issues are resolved, the application is received by the Mining Advisory Council, which makes a recommendation to the Minister for Mining, who is ultimately responsible for approving all mining and exploration leases, with the exception of Special Mining Leases. Special Mining leases are approved by the GovernorGeneral of PNG, on advice from the National Executive Council.
4.1.5 Exploration Licence reporting requirements and extensions Once an Exploration Licence (EL) is granted, the licensee must submit biannual and annual reports to the MRA on its progress. A brochure, Exploration Licence and Mining Lease Reporting Requirements, is available from the MRA. The MRA may ask for additional reporting at its discretion. Penalties exist for late lodgement of reports, false reporting and environmental breaches. A licensee may apply for extensions to an EL using the application process detailed above. Holders of Exploration Licences are obliged to relinquish not less than half the original tenement when renewing the licence.
4.1.6 Mining and Special Mining Lease requirements and extensions Under the conditions in Mining Leases and Special Mining Leases, licensees must provide the following studies prior to operations being given final approval: > Bankable Feasibility Study > Scoping Study > Environmental Inception Report > Environmental Impact Statement > Compensation Agreement. Guidelines and standard templates for these reports are available from the MRA.
THE PNG INVESTORS’ MANUAL - SECOND EDITION
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