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Ok Tedi - Papua New Guinea

The Ok Tedi mining operation was developed to extract the copper-gold orebody within Mount Fubilan. The orebody is located in the Star Mountains of the Western Province of Papua New Guinea, 18 kilometres from the Indonesian border. The mine lies in the headwaters of the Fly River catchment at an altitude of 2,053m in a very high rainfall area that averages 850-1050 centimetres annually. The area is seismically active which along with the steep terrain and high rainfall contributes to geological instability.

The operation is regulated by the Mining (Ok Tedi Agreement) Act 1976 and the various Supplemental Agreement's that followed. The latest revision, the Mining (Ok Tedi Ninth Supplemental Agreement) Act, was passed in December 2001 to allow for the withdrawl of BHP Billiton and transfer of its share of the Ok Tedi operation to a new company, PNG Sustainable Development Program Limited.


Major Groups Involved

Ok Tedi Mining Limited (OTML) - Operator of the mining and milling facilities at the Ok Tedi mine, and shipping facilities at the Fly River port of Kiunga in the Western Province. OTML is owned by the Australian company, BHP-Billiton Limited (52%), the State of Papua New Guinea (30%: 15% in its own right; 2.5% on behalf of local landowners; and 12.5% on behalf of the people of the Western Province) and the Canadian company Inmet Mining Corporation (18%). BHP-Billiton manages the OTML operations on behalf of the other shareholders.

BHP Billiton - Formerly Broken Hill Proprietary (BHP) Limited. An Australian and United Kingdom company. Majority shareholder of OTML and manager of operations until January 2002 when they withdraw from further involvement. Their share has been transfered to a newly formed company PNG Sustainable Development Program Limited. Recent information relating to BHP Billiton and the Ok Tedi operation is available.

Inmet - A Canadian based mining company with three mining operations, the most significant of which is Ok Tedi, . Information on the Ok Tedi Operation is available.

State of Papua New Guinea - The Papua New Guinea Government.

PNG Sustainable Development Program Limited (SDPL) - Company formed to take over the former BHP Billiton share of OTML.



Historical News Time Line

7 Dec 2004 OK Tedi could stay open until 2012 - The controversial Ok Tedi mine in Papua New Guinea is expected to remain open until 2012, two years longer than previously thought.
13 Feb 2002 Press Release - Inmet Announces Completion of Ok Tedi Arrangements - The transfer of BHP Billiton’s 52% equity interest in Ok Tedi Mining Limited (OTML) to PNG Sustainable Development Program Limited (SDPL) has been completed.
5 Jan 2002 Online Asia Times - BHP Billiton leave the scene of the crime
11 Dec 2001 Statement to Parliament by the Prime Minister -
Rt. Hon. Sir Meker Morauta, Kt MP -
On A Court Action In Australia Relating to the Ok Tedi Mine
11 Dec 2001 Second Reading Speech to Parliament On
Mining (Ok Tedi Mine Continuation (Ninth Supplemental) Agreement) Bill
- By the Minister for Mining, Hon Chris Haivetta, MP. - Changes to Ok Tedi Legislation to allow for the transfer of the BHP Billiton 52% share of OTML, to a newly established company PNG Sustainable Development Program Limited (SDPL). This will allow the exit of BHP Billiton by the end of 2001 while ensuring the continuation of mining operations until the end of mine-life. The Bill also grants unrestricted legal indemnity to BHP and OTML for pollution and damages caused by the mine.
26 Sep 2001 NEC Approves Ok Tedi Proposal (Adobe PDF 104KB) - The National Executive Committee (NEC) of the State of Papua New Guinea endorses BHP Billiton's withdrawl from the Ok Tedi mine.
17 Oct 2000 2000 BHP Annual General Meeting - Chairmans Address by Don Argus, Chairman, BHP Ltd. - Announcement of the decision regarding the exit of BHP Ltd from the Ok Tedi mining operation. An extract of the relevant section of the Address is available here (Adobe PDF). The full 2000 AGM Address is available from the list of BHP Speech and Business Briefings.
11 Apr 2000 BHP News Release - Legal Action on Ok Tedi Misconceived: BHP
April 2000

Two legal actions commenced in Victoria, Australia against BHP Billiton Ltd and Ok Tedi Mining Ltd, seeking specific performance of the 1996 out-of-court settlement agreement and/or an injunction requiring BHP Billiton and OTML to construct a tailings pipeline and associated storage system, and damages. Both actions will complete the interlocutory phase by 7 January 2002 allowing local community members affected by the opration to join or opt out.

Information on the Ok Tedi Legal Claims is availale from the BHP Billiton website.

8 Mar 2000 UN Wire - World Bank Urges Copper Mine Closure
11 Aug 1999 BHP News Release - BHP and Ok Tedi
8 Jun 1996 The parties in the litigation signed an agreement to resolve the dispute out-of court.
   
  Incomplete...
   
1981 Development of the Ok Tedi mine commences, continuing for the next 8 years.
1968 The Ok Tedi ore body is discovered.

 


Links to Further Information

BHP and Ok Tedi: Discussion Paper (Adobe PDF 858KB)- BHP Ltd, October 1999.

BHP and Ok Tedi - Directions Update (Adobe PDF 154KB) - Short interview with CEO Paul Anderson.

World Bank Report - Ok Tedi Mining Ltd. - Mine Waste Management Project - Risk Assessment and Supporting Documents - January 2000.

World Bank Ok Tedi Report Cover Letter to Papua New Guinea Government, 20 January 2000.


Related Bibliography

UNESCAP - Integrating Environmental Considerations into Economic Decision-making Process - Institutional Arrangements and Mechanisms - I. Natonal Institutional Arrangements for Integrating Environmental Concerns into Policy Decision-Making Processes - D. Assessment of adequacy of institutional arrangements - Examines Papua New Guinea providing a case study on the Ok Tedi mine compensation claim out-of-court settlemnt reached in June 1996.

The Ok Tedi Settlement: Issues, Outcomes and Implications - Ed. by: Glenn Banks and Chris Ballard, National Centre for Development Studies and Resource Management in Asia-Pacific Project (Australian National University), Canberra, Australia, 1997.

Changing Relations of Production in the Creation of the Ok Tedi Mining Enclave in Papua New Guinea (Adobe PDF) - David Hyndman, Resource Management in Asia-Pacific Working Paper No. 11, Australian National University, Canberra, Australia, 1995.

The Killing of the Fly: State-corporate victimization in Papua New Guinea (Adobe PDF) - Ainsley Harper and Mark Israel, Resource Management in Asia-Pacific Working Paper No. 22, Australian National University, Canberra, Australia, 1999.

Environmental Disclosures in Annual Reports of Australian Gold and Copper Mining Companies with Activities in Papua New Guinea and/or Indonesia (Adobe PDF) - Roger L Burrit, Resource Management in Asia-Pacific Working Paper No. 13, Australian National University, Canberra, Australia, 1997.

Muddying the Waters of the Fly: Underlying Issues or Stereotypes? (Adobe PDF) - Richard T. Jackson, Resource Management in Asia-Pacific Working Paper No. 41, Australian National University, Canberra, Australia, 2003.

Regional Seas Reports and Studies No. 099. Potential impacts of mining on the Fly River - UNEP, ISBN 9280710256, 1988. This document can be purchased through Earthprint.


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