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By Yehiura Hriehwazi

PORT MORESBY, PNG (The National, Aug. 7) -- Large-scale mining is returning to the Wau-Bulolo region, after almost seven decades, following the signing on Friday of the Hidden Valley gold project agreement in Wau.

The signing of the Hidden Valley memorandum of agreement (MOA) and four other instruments was witnessed by Prime Minister Sir Michael Somare. It paves the way for Harmony Gold of South Africa to start mine construction at the cost of A$220 million (about K500 million).

Thousands of villagers trekked into Wau to participate in traditional dances and witness the occasion.

The mine would generate K70 million annually in export earnings when it comes on stream in early 2007.

The member for Bulolo, John Muingnepe, who represents the Wau people in Parliament, welcomed the people and VIPs to his electorate where one of the world’s largest ever gold rushes occurred during the 1920s and 1930s.

The Deputy Speaker and Kabwum MP, Bob Dadai, and Markham MP, Andrew Baing, were also present.

It was a "milestone event", according to Finance and Treasury Minister Bart Philemon, who signed the MOA with Morobe Governor Luther Wenge, Mining Minister Sam Akoitai and Harmony Gold chief executive, Graham Briggs, and the president of the Nakuwai Landowners Association, Rex Mauri.

Also at the ceremony was National Planning Minister Arthur Somare, who presented K100,000 to landowners as part payment of a K500,000 that will act as ‘seed money’ for spin-off business activities.

Mr Wenge made a similar presentation of K100,000 as his government’s commitment under the MOA, and undertook that another K400,000 would be paid by the end of the year.

Mr Akoitai said this was the first PNG mining project where the MOA, mining lease, mining easement agreement, compensation agreement and supplementary arrangements were all signed on the same day - a demonstration of excellent efforts by his staff, the negotiating parties, the provincial administration, the company and landowners.

Mr Briggs told The National the mine would produce 300,000 ounces of gold and 4.5 million ounces of silver annually and employ up to 600 people.

He said Harmony would build a K45km road from Bulolo through the PNG Forest Products pine plantations and through the small-scale Eddie Creek mine to Hidden Valley.

"This will take about three months. When the road is complete, we will bring in machinery using the road and start mine construction. It will take 18 months to complete the mine.

"We will get into full production as quickly as possible," said Mr Briggs.

He said he was thrilled with the support of Sir Michael and other Cabinet Ministers, the local people and the provincial governor and his administration.

"We have never had so many ministers at one of our operations like this," he said.

Information made available to The National showed that up to K6m a year will be paid in royalties to landowners and the provincial government with the project’s wages bill totalling K12m a year.

Monday, August 8, 2005

The National: www.thenational.com.pg/

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