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Company News

UPDATE 1-Barrick a 'long way off' deal with PNG in mine dispute, CEO says

(Adds detail, background)

TORONTO/JOHANNESBURG, Oct 16 (Reuters) - Barrick Gold Chief Executive Mark Bristow said on Friday the Canadian miner was a “long way off” reaching agreement with Papua New Guinea (PNG) about the disputed Porgera gold mine.

In April, Prime Minister James Marape had refused to extend the expired mining lease held by a venture of Barrick and its partner China’s Zijin Mining , citing environmental and social problems.

But on Thursday Marape said the venture was set to remain operator of the mine after talks in Port Moresby.

“We’re a long way off reaching agreement,” Bristow said at the Financial Times Mining Summit. “We’re very clear about our rights and the importance that Porgera offers to that part of Papua New Guinea.”

Barrick and Zijin each hold 47.5% in Porgera mine, with the remaining 5% held by Mineral Resources Enga, a venture of Enga province and local landowners.

After Marape’s announcement in April, Barrick mounted legal challenges and closed the mine in a year when spot gold prices have hit all-time highs.

Marape said in a Facebook post on Friday that PNG would hold a majority stake in the mine under a new agreement.

He also said that “subject to final touch ups” he had not made concessions on other major points, including that the mining lease would be held by a state-owned entity and Barrick should “phase out at an agreed time”.

Bristow did not comment when he was asked how much equity, if any, Barrick would give up.

Zijin board secretary Zheng Youcheng told Reuters the company could reduce its stake in Porgera, but said the whole project was still under negotiation. (Reporting by Jeff Lewis and Helen Reid; Editing by Chizu Nomiyama and Edmund Blair)

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