Skip to main content
The Globe and Mail
Support Quality Journalism.
The Globe and Mail
First Access to Latest
Investment News
Collection of curated
e-books and guides
Inform your decisions via
Globe Investor Tools
Just$1.99
per week
for first 24 weeks

Enjoy unlimited digital access
Enjoy Unlimited Digital Access
Get full access to globeandmail.com
Just $1.99 per week for the first 24 weeks
Just $1.99 per week for the first 24 weeks
var select={root:".js-sub-pencil",control:".js-sub-pencil-control",open:"o-sub-pencil--open",closed:"o-sub-pencil--closed"},dom={},allowExpand=!0;function pencilInit(o){var e=arguments.length>1&&void 0!==arguments[1]&&arguments[1];select.root=o,dom.root=document.querySelector(select.root),dom.root&&(dom.control=document.querySelector(select.control),dom.control.addEventListener("click",onToggleClicked),setPanelState(e),window.addEventListener("scroll",onWindowScroll),dom.root.removeAttribute("hidden"))}function isPanelOpen(){return dom.root.classList.contains(select.open)}function setPanelState(o){dom.root.classList[o?"add":"remove"](select.open),dom.root.classList[o?"remove":"add"](select.closed),dom.control.setAttribute("aria-expanded",o)}function onToggleClicked(){var l=!isPanelOpen();setPanelState(l)}function onWindowScroll(){window.requestAnimationFrame(function() {var l=isPanelOpen(),n=0===(document.body.scrollTop||document.documentElement.scrollTop);n||l||!allowExpand?n&&l&&(allowExpand=!0,setPanelState(!1)):(allowExpand=!1,setPanelState(!0))});}pencilInit(".js-sub-pencil",!1); // via darwin-bg var slideIndex = 0; carousel(); function carousel() { var i; var x = document.getElementsByClassName("subs_valueprop"); for (i = 0; i < x.length; i++) { x[i].style.display = "none"; } slideIndex++; if (slideIndex> x.length) { slideIndex = 1; } x[slideIndex - 1].style.display = "block"; setTimeout(carousel, 2500); } //

A view of tailings at Barrick Gold Corp's Porgera mine in Papua New Guinea.

Catherine Coumans/MiningWatch Canada

China’s Zijin Mining has warned Papua New Guinea that its failure to renew the lease of a gold mine it jointly owns with Barrick Gold Corp there could damage bilateral relations.

Papua New Guinea on Friday said it would not renew a 20-year mining lease at its Porgera gold mine, citing environmental damage and social unrest even as gold prices have soared to more than seven-year highs.

Barrick (Niugini) Limited (BNL), the local venture in which both miners have a 47.5% stake, suspended operations on Saturday, saying the government had not given it formal notification that it would not renew the lease, or any details of a planned transition.

Story continues below advertisement

Zijin, which is a state-controlled company, said that Papua New Guinea needed to conduct negotiations to extend the mining lease in good faith, and that a failure to resolve the issue could impair relations between the two countries.

“As a Chinese enterprise, Zijin would like to contribute to the existing good economic, trade, cultural and inter-governmental relations between China and PNG,” Chen Jinghe, chairman of Zijin’s board said in a letter addressed to Papua New Guinea’s Prime Minister James Marape.

“However, if Zijin’s investment in Porgera mine is not properly protected by the PNG government, I am afraid there will be significant negative impact on the bilateral relations between China and PNG,” he said in the letter, dated Monday, seen by Reuters. Chen’s office confirmed the letter had been sent.

China’s Ministry of Foreign Affairs said in a statement to Reuters that the legitimate interests of Chinese firms had to be effectively protected.

It added that Papua New Guinea was a good friend of China’s in the Pacific Ocean and that the two countries had maintained good ties.

China’s embassy in Port Moresby did not immediately respond to an emailed request for comment. The office of Papua New Guinea’s Prime Minister did not respond to a request for comment.

China has steadily increased its influence and spending in the Pacific in recent years, and is Papua New Guinea’s biggest creditor, budget figures show.

Story continues below advertisement

The BNL joint venture had run into opposition from local landowners and residents. Critics say the Porgera mine has polluted the water and created other environmental and social problems, with minimal economic benefits for locals.

Marape warned Barrick in a social media post on Monday that the government would take control of the mine if it closed during the transition period.

Both miners have said they would pursue all legal means to protect their interests and recover damages.

Zijin also said that it understood the need for greater benefits distribution among governments, landowners and stakeholders.

But if the special mining lease extension is not granted, the mine will be forced to close, the company said.

That would also result in “the removal of the installations and facilities in the mine...(which) would render the mine’s operation impossible for years,” the company added.

Story continues below advertisement

Your time is valuable. Have the Top Business Headlines newsletter conveniently delivered to your inbox in the morning or evening. Sign up today.

Your Globe

Build your personal news feed

  1. Follow topics and authors relevant to your reading interests.
  2. Check your Following feed daily, and never miss an article. Access your Following feed from your account menu at the top right corner of every page.

Follow topics related to this article:

View more suggestions in Following Read more about following topics and authors
Report an error
Tickers mentioned in this story
Due to technical reasons, we have temporarily removed commenting from our articles. We hope to have this fixed soon. Thank you for your patience. If you are looking to give feedback on our new site, please send it along to feedback@globeandmail.com. If you want to write a letter to the editor, please forward to letters@globeandmail.com.

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff. Non-subscribers can read and sort comments but will not be able to engage with them in any way. Click here to subscribe.

If you would like to write a letter to the editor, please forward it to letters@globeandmail.com. Readers can also interact with The Globe on Facebook and Twitter .

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff. Non-subscribers can read and sort comments but will not be able to engage with them in any way. Click here to subscribe.

If you would like to write a letter to the editor, please forward it to letters@globeandmail.com. Readers can also interact with The Globe on Facebook and Twitter .

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff.

We aim to create a safe and valuable space for discussion and debate. That means:

  • Treat others as you wish to be treated
  • Criticize ideas, not people
  • Stay on topic
  • Avoid the use of toxic and offensive language
  • Flag bad behaviour

If you do not see your comment posted immediately, it is being reviewed by the moderation team and may appear shortly, generally within an hour.

We aim to have all comments reviewed in a timely manner.

Comments that violate our community guidelines will not be posted.

Read our community guidelines here

Discussion loading ...

To view this site properly, enable cookies in your browser. Read our privacy policy to learn more.
How to enable cookies