PNG MINING COMPANY SIGNS US$850 MILLION DEAL

PORT MORESBY, Papua New Guinea (Fijilive, Feb. 6) - Papua New Guinea’s Mineral Resource Development Company (MRDC) has signed a US$850 million agreement with Highlands Pacific to develop a nickel-cobalt project in Ramu.

Situated in the highlands of Ramu, the nickel is expected to sell at about US$3.50 a pound over the next few years.

Francis Kaupa, MRDC Acting General Manager says the purchase provides a catalyst for the resolution of a legal dispute between Oil Search and Highlands Pacific.

Highlands filed a claim against the Oil Search subsidiary, Orogen Minerals, in the Federal Court of Australia in 2002.

The dispute went to Federal Court after Kaupa, in his capacity as managing director of Orogen, failed to reach agreement with Highlands Pacific.

Although this revolved around Orogen’s decision to exercise a put option and force Highlands Pacific to buy back its 31.5 percent stake in Ramu, Kaupa extolled the virtues of MRDC's purchase of the stake.

"It has the potential to be a major supplier of nickel and cobalt to global markets and is considered to be a world class development opportunity. Government could still exercise its option to take an additional 30 percent stake in Ramu and gain a 52.05 percent controlling stake," said Kaupa.

Prime Minister Michael Somare, who played a key role in resolving the HPL-Oil Search court case, said confidence in the economy would grow because several projects were taking shape, including the Wewak tuna plant and InterOil’s decision to commence exploration while its completes construction of its Napa Napa refinery.

February 6, 2003

Fijilive: http://www.fijilive.com/ 

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