Press Release – 20thDecember, 2013

StopUse ofForeign Consultants to Review Mining Act 1992.

The Resource Owners Federation of PNG Inc. calls on the government to direct the Department of Mining to immediately stop the use of Foreign Consultants to review the 1992 Mining Act and its policies. The use of such consultants in the past has deprived the country and citizens of a fair return in royalties, equity and other benefits from mining their mineral deposits. The laws and policies have been written to benefit the foreign Investors at the expenses of the citizens. This is why the country has been and continues to be branded as an“impoverished watershed”, when it is richly blessed with natural resources. Our Political leaders and civil servants are either incompetentor blind to continually use foreign consultants even when such practice is prohibited by the National Goals and Directive Principals of our National Constitution.

Section 279 subsection 3 of the Constitution among others call for the “strict control of foreign investment capital and wise assessment of foreign ideas and values so that these will be subordinate to the goal of national sovereignty and self –reliance.

The Minister and Secretary of Mining must now explain to the nation the reasons for their continued use of foreign consultants to review the 1992 Mining Act and Policies, contrary to the above provisions of the National constitution, knowing that the use of such consultants in the past has deprived the nation and its citizens of fair social and economic benefits arising from almost all the mining projects in this Nation. They must explain why they have not been able to exclusively use our own citizens to carry out the consultancy work in reviewing the legislation, when we have thousands of qualified citizens after 37 years of Independence and education. When will the Department stop using foreign Consultants?

The consequence of the actions of the Mining Department isevident in the results of the work produced by the Consultants. For example: the amended Mining Act proposes to lock mineral royalty rates at 2% again while current mineral royalty rates in other countries in Asia Pacific region average at above 10%. The rate of 2% has been locked in the Mining Act since 1992, whilst common practice in other countries is to adjust these rates when economic conditions change. What possible justification can the Minister and Secretary for Mining offer to the Nation other than to say that, the rate is what we have been advised to use by our foreignConsultants? The amended Act further proposes that equity participation by landowners and Provincial governments be maintained at 5% each. What possible justification do the Minister and Secretary for Mining have, other than to say that is what their foreign Consultants advised? Any conduct by them that breaches the constitution of this country, as is the case by their use of foreign Consultants, is what the federation believes is a breach of the Constitution and amounts to a misconduct in Public office. We call on the Prime Minister to take appropriate action to remedy this serious breach of public duty to protect the national interest.

The Federation has also made submissions on behalf of landowners in the country, but we have not been given a copy of the draft legislation for review. Why is it still a secret? What else are they covering up or hiding, and hoping to slip through Parliament one day when the parliamentarians are not paying much attention?

We further call on all Members of Parliament,not to vote for any amendment that denies this country and its citizens of fair social and economic returns for the extraction of minerals from our soils.



Jonathan Paraia


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