Asia Times: New PNG mine project stirs up furore



	August 27, 1999	atimes.com

Oceania

New PNG mine project stirs up furore
By Kevin Pamba

PORT MORESBY - Another environmental row has erupted in Papua New Guinea, this time around plans for a US$838 million nickel mine whose tailings will be dumped into the sea along the country's northern coast.

The furore comes just after the release of scientific reports confirming serious damage to river systems and livelihoods by the 15-year dumping of tailings from the Ok Tedi copper mine. The Ok Tedi case has raised questions about the sustainability of mines with poor tailings disposal records - the same doubts about the proposed Ramu nickel mine.

The operator and majority owner of the Ramu mine, Highlands Pacific Ltd, says the disposal of tailings into the sea will cause minimal environmental harm during the project's 20-year lifespan. The mine's environmental plan was given to the Office of Environment and Conservation in February and is pending government approval.

Highlands Pacific, 65 percent owned by PNG interests and 35 percent Australian, hopes to start the Ramu project by year end. It is estimated the project will add 15 percent to the exports of PNG, a little less than the 20 percent Ok Tedi was contributing.

The latest criticism of the Ramu project came on Thursday from Australia's mining watchdog, the Mineral Policy Institute (MPI), which said the project has the potential to cause great environmental and social damage. Moreover, investors also risk being open to unplanned compensation and rehabilitation costs.

The MPI claimed the 60 million tonnes of mine tailings to be discharged over the lifespan of the mine would likely be rich in heavy metals and toxins, which could cause severe impacts on human health and the surrounding environment.

Highlands Pacific Ltd rejected the MPI claims as ''outrageous'', saying the institute had ignored the company's environmental plan. In the plan and in media advertisements, Highlands Pacific Ltd says tailings that will go into the pristine Vitiaz Basin along PNG's northern coast are ''fundamentally non-toxic, marine environmental effects are forecast to be minimal and short term [while] existing fisheries will be entirely unaffected''.

But independent scientists, activists and even government agencies like the National Fisheries Authority who reviewed the mine's environmental plan disagree. The National Fisheries Authority, the government arm that oversees PNG's lucrative fishing industry, has concluded that the tailings disposal plan poses a real threat to the huge tuna fishing industry and other fisheries.

In a March 31 report leaked to media, the authority lists PNG's problems with huge mines, ranging from the Panguna mine in Bougainville island, the Misima gold mine in Milne Bay province and the Ok Tedi mine near the border with Indonesia. 'The point is that mining has not achieved sustained economies nor improved social structures in PNG. It has broken down families and leaves crippling economic situations at all levels of PNG society,'' the fisheries authority said.

It added: ''There are other developmental projects suitable to PNG conditions and mining is not one of them because it is environmentally destructive and our people have always been sustained at the local level by the continuing existence of a functional environment, not large industrial projects.''

But Highlands Pacific defends its ''deep-sea tailing placement'' plan, citing studies by its Australian environmental consultant, NSR Consultants. It notes that other countries like Indonesia, Canada and Turkey have similar mine disposal systems. It says that predictions of tailings deposits over 20 years show that less than two percent of basin floor will be covered by mine tailings, which will be buried anyway.

But an American scientist based at the University of PNG, Dr Tom Wagner, says in an independent review dated July 21 that the Ramu mine should not be allowed because fundamental facts about the impact of tailings are missing. Wagner disputed Highland Pacific's claims that the tailings are likely to be buried by the sedimentation from the rivers in the area of the Vitiaz Basin.

In an interview, Wagner described the work of NSR Consultants as ''sloppy . . . very important points are glossed over''. He reviewed the information on request of the Office of Environment and Conservation. His report notes three major areas missed by the widely circulated reports prepared by NSR Consultants, including the identification of toxins in the tailings, the consequences of depositing tailings solids and associated metals on the seabed, and the effects of ingestion of tailings solids on marine organisms.

Ingested tailings may prove toxic and are an avenue for toxins to be accumulated in the food chain, Wagner says. He adds that the threat of volcanic activity must be addressed, since the nickel refinery plant is to be located near the highly active Long Island Volcano.

The National Fisheries Authority warns that the proposed deep-sea tailings plan for Ramu is unlikely to work, given the current dynamics of the Vitiaz basin. Furthermore, the fisheries resources of the Bismarck Sea are valuable as food security for PNG, as well as a renewable revenue-generating source that may be hurt by the nickel mine project.''These reef and tuna resources of the Bismarck Sea rely on the continuing clean and productive environment of the Bismarck Sea,'' it said.

The fisheries body points out that PNG's largest tuna fleet is based on the Madang coastline, along which sediment flows naturally from the Vitiaz Basin. It concludes that the Ramu project is ''unsustainable'' economically and environmentally. The mine would also breed problems such as alcoholism and sexually transmitted diseases among locals and mine workers and disrupt subsistence lifestyles that are based on food self-sufficiency.

Critics say these undercut the proponents' statements that the Ramu project - which will also produce some cobalt - will be genuinely economically viable. Expected annual sales from Ramu are put at $260-270 million a year. The estimated value of benefits to locals, the provincial and national government in compensation, royalties and taxes is some $103.5 million, proponents say.

The Ramu nickel resource was first discovered by the Australian Bureau of Mineral Resources in 1962, but Highlands Pacific became involved in 1997 after acquiring a stake in a company which had interest in the resource. The American firm Nord Pacific Ltd is a minor owner of the Ramu project.

Looking at PNG's record with mines, the Fisheries Authority says that ''all the other mines still leave Papua New Guinea worse off and not better''. ''The Panguna mine crippled PNG for 10 years economically. The Ok Tedi Mine has had million kina lawsuits, while 200 kilometers of the Fly River lies dead [and] the people downstream look for water and fish.''

(Inter Press Service)