Saturday, September 1, 2012

Dealing with Ok Tedi's destructive legacy

I am in Tabubil as a guest of Ok Tedi Mining Ltd (OTML) to cover the launching of its environment monitoring vessel, the MV Fly Explorer, in Kiunga tomorrow. The vessel is worth around 2.3 million US bucks and is paid for by the Ok Tedi Trust Development Fund (OTDF). The vessel will be leased by OTDF to OTML to be used as a scientific research vessel to monitor damages caused along the Fly River by Ok Tedi mine.

OTDF was set up as an arrangement between OTML and PNGSDP. OTDF now receives funding from PNGSDP and the Western Province People's Dividend Trust Fund set up by State under Mining(Ok Tedi) Mine Continuation (Ninth Supplemental) Agreement) Act 2001.

In other words, OTDF has used Western Province people's money to buy a vessel to monitor damages to the Fly. It is expected that the money will be recouped as OTML makes lease payments for the use of the vessel.

Western Province's political elite are meeting Ok Tedi mine Officials today in Tabubil. The new Governor and the 3 Open Members of Parliament are expected to arrived at 10 am for a briefing at the Golf Club. They are then expected to witness the launching of MV Fly Explorer tomorrow.

Officials from PNG Sustainable Development Limited (PNGSDP) are also expected to be present today and tomorrow. PNGSDP was created by BHP Billiton as it exited it's world class mine in Western Province after creating a world class environmental catastrophe. It (PNGSDP) was created as part of a deal that prevents Western Province people from suing BHP Billiton for damages to the Fly River.

The damages to the Fly River ecosystems and the villages whose livelihoods depend on the Fly have been enormous. The PNG Government has recognized this by granting 5% equity in the mine to affected villages. The problem with equity arrangements like this is that the people only benefit if the miner makes a profit or if they sell their shares. It would have been much better for them to be given a certain percentage of export value of each copper shipment, fixed at the World Market Price.

OTML, which is now co-owned by the Government of Papua New Guinea and PNGSDP, has since been trying to reduce further damages to the Fly River. It has built a tailings disposal mechanism (previously tailings were directly discharged into the Fly River Tributriaries resulting in the Worlds Third Largest Environmental Catastrophe)

A tailings pipeline runs from the mine site at Tabubil to Bige. It is currently being replaced following a flaw in the pipeline that caused a major tailings spill last year.