The Asia Miner

JUL-SEP 2018

The ASIA Miner - Reporting Important Issues to Mining Companies in the Asia Pacific Region

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the asia miner • volume 15 • issue 3 21 REGIONAL FOCUS: PNG Nauঞlus Minerals has entered a $US34 million agreement with lender Deep Sea Mining Finance for deep- sea mining development in Papua New Guinea, but conঞnued local pressure conঞnues to shake the project to its core. Nauঞlus Minerals, a Canada-based company primarily owned by Russian and Omani mining firms, is responsible for the Solwara 1 deep sea mining project in Papua New Guinea. The companies have been granted a charge over Nauঞlus' 85 per cent interest in Solwara 1, subject to PNG governmental and third-party approvals. Of the $US34 million figure, Nauঞlus has already received $US11.25 million as a bridge loan, with the remaining $US22.75 million to be advanced with a maturity date of 8 January 2019. The loans are secured against the assets of the Company through a general security agreement granted by the company in favour of the lender, along with a pledge of all the shares held by the company in its subsidiary Nauঞlus Minerals Niugini (NMN). As reported by The ASIA Miner in January of this year, the much publicised Solwara 1 project, which involves extensive deep seabed dredging using a seabed mining technique never used before in commercial operaঞons to extract gold and copper deposits from 1.6km below the surface of the Bismarck Sea, has received some concern and criঞcism regarding its potenঞal environmental effects. In December last year, locals launched legal acঞon against the PNG Government over the project, a move Nauঞlus chief execuঞve officer Mike Johnston branded "a publicity stunt". The Centre for Environmental Law and Community Rights (CELCOR) in Port Moresby is represenঞng the plainঞffs, who are seeking informaঞon on the legality of the mine's approval – with the PNG Government believed to own a 15 per cent stake in the operaঞons. Addiঞonally, due to deficiencies in the Solwara 1 Environmental Impact Statement, the plainঞffs are seeking A Naulus bulk cuer for deep sea mining. Image courtesy of ©Naulus Nautilus Minerals secures $US34m for deep-sea mining in PNG informaঞon that would help them to clearly understand the potenঞal environmental, health and economic impacts of the project. "Very li•le informaঞon about the Solwara 1 project has been disclosed by PNG Government or the project developer, Nauঞlus Minerals", stated Peter Bosip, Execuঞve Director, CELCOR. The Environmental Defenders Office (EDO) NSW, who have partnered with CELCOR, called the proceedings "landmark". "This is a historic case, not just for Papua New Guinea but globally, as communiঞes try to understand the legality and potenঞal impacts of the world's first commercial deep seabed mine," said BJ Kim, internaঞonal program manager at EDO NSW. Adding to Nauঞlus' frustraঞons is Anglo American's exit from the Solwara 1 project. The Deep Sea Mining Campaign has stated in a release that in advance of their London AGM in May this year, Anglo American had exclusively confirmed their break with Nauঞlus. Dr Helen Rosenbaum, of the Deep Sea Mining Campaign said "We are pleased that Anglo American engaged with us and listened to the concerns of coastal and islands communiঞes in Papua New Guinea, whose environment and way of life would be devastated by Nauঞlus's proposed Solwara 1 mine." Dr Rosenbaum conঞnued "Anglo's decision to dump their minority stake in this controversial company was the only opঞon consistent with their internaঞonal commitments to sustainability, human rights, and environmental stewardship. Deep sea mining is financially and environmentally risky. The legiঞmacy of the Solwara 1 project has been quesঞonable right from the outset with independent reviews highlighঞng significant flaws in the Solwara 1 Environmental Impact Statement." Legal acঞon launched by Papua New Guinean communiঞes will also answer quesঞons about whether the Solwara 1 project was lawfully approved. In the meanঞme, local communiঞes have turned out in force at formal hearings held in PNG's New Ireland Province to object to the extension of Nauঞlus exploraঞon licences.

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