Barrick ready to sign deal to reopen Porgera mine

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Canada’s Barrick Gold (TSX: ABX) (NYSE: GOLD) confirmed on Monday reports indicating that Papua New Guinea prime minister James Marape was ready to sign a deal to reopen Porgera gold mine.

The operation has been closed for a year, after Barrick and its Chinese partner, Zijin Mining, become embroiled in a dispute with the PNG government, when Marape refused to renew the companies’ Porgera licence.

The companies temporarily halted operations in response. They also served Marape with a dispute notice arguing the license extension refusal violated a bilateral investment treaty between PNG and Australia. 

Barrick chief executive Mark Bristow and his team met Marape in October 2020, after reaching a deal to end the then six-month-long dispute over mining rights to the Porgera gold mine.

The agreement under discussion is in line with the principles announced in that meeting, the Toronto-based miner said in a statement. It sets up a joint venture between Barrick Niugini Limited (BNL) and PNG to operate Porgera going forward on the basis of increased ownership for the country’s government and a “fair sharing” of economic benefits. 

Barrick said BNL would continue as the operator of the mine, adding it would issue a further statement once a final agreement is achieved.

More to come…