Papua New Guinea (PNG) has threatened Barrick Gold with criminal proceedings, claiming the company’s joint venture in the country was planning to illegally export $13 million in silver and gold to Australia.
The country’s mining regulator said that Barrick Niugini Limited (BNL) asked earlier this week for clearance to ship precious metals to the Perth Mint.
The move, the Mineral Resources Authority (MRA) said, is considered illegal given that BNL is not allowed to process or ship gold since the government’s refused to extend its mining lease for the Porgera mine almost two months ago.
The world’s second-largest gold producer and its Chinese partner, Zijin Mining, temporarily halted operations at the mine in the Enga Province in late April, following Prime Minister James Marape’s decision not to renew Porgera’s lease.
Barrick, which is challenging the resolution in court, welcomed last month a ruling ordering the PNG government to review the requested lease extension for the Porgera mine.
BNL refutes PNG’s claim that it had sought to export gold. It told Reuters it had always complied with its legal obligations regarding bullion and silver exports.
Barrick and Zijin applied in June 2017 for a 20-year renewal of the Porgera’s lease, which expired in August last year.
Since then, they have faced backlash from landowners and residents over what they claim are negative social, environmental and economic impacts from the mine.
Negotiations with Porgera’s operators were complicated further by a split among the landowners.
PNG’s latest move could signal a further breakdown in relations, which may lead to the appointment of an arbitrator.
The ongoing dispute with PNG over the Porgera mine has done what the pandemic did not — dent the Barrick’s expected output for the year.
The world’s second-largest gold producer now expects to produce between 4.6 million and 5 million ounces of gold this year — 200,000 ounces lower than its previous estimate.
Barrick revealed at the time that PNG was also asking the company and Zijin to pay $191-million in back taxes, arising from tax audits conducted between 2006 and 2015.
The Toronto-based miner said the request, received on April 9, had no merit.
Porgera, located in PNG’s northern highlands region, contributes to about 10% of the nation’s exports and employs over 3,300 locals.
The open pit and underground gold mine sits at an altitude of 2,200-2,600 metres in Enga province, and is about 600 km (370 miles) northwest of Port Moresby.