Freida Mine Update



By the close of Business today –May 27th 2015  Guandong Rising Asset Management [ GRAM] of China will have taken over 86 % controlling interest over the small Australian Mining Company Pan Aust Ltd which as I have pointed out over the last two years does not have the Financial resources to  fully develop the Frieda R4iver Deposit in the West Sepik Province. Pan Aust Ltd entered the Frieda Project by  stealth a year ago  and have now again disappeared in the same way as they first appeared in Frieda in 2013. The cost of their involvement in Frieda put a cool  USD$950 million on the value of Pan Aust Ltd. In his address to Pan Aust Shareholders on Friday the 22nd of may 2015 the Chairman of PNG reported to the Australian Stock Exchange that Pan Aust Share Holders after holding out for a year have now accepted an offer of US$950 million to sell out to Guangdong Rising Asset management a company owned by the Municipal Authority of Shenzhenand listed on the Shenzhen Stock Exchange in Southern China.

Now What does the Future hold for PNG and the Frieda Project  in view of the Chinese take over of Pan Aust Ltd ?

In November 2015 Exploration licence number 58 which covers the main area of the Frieda River Deposit will come before the registrar of mines for a 2 years renewal. The exploration licence remains the property of the Government of PNG and is issued subject to terms and conditions that is imposed by the Head of State acting on Advice of the NEC[ National Executive Council].

The National Executive council in Decision 265/2014  in special meeting no 23/2014 based on Policy Submission No 242/2014 [ see attached documents] agreed in principal to take over ownership and control over the Frieda river Deposit and to develop it in a manner consistent with the National Goals and directive principal of our National Constitution. It is therefore important the GRAM knows of this decision and that all agencies of the Government align themselves to this decision to ensure that this important National Resource is not sold off cheaply again to fly by night companies such as Pan Aust Ltd. It is also important for Government Agencies to watch out for PNG Compradors representing foreign Multinational Companies such as GRAM, Pan Aust Ltd and others who may wish to pull the wool over our eyes just as many have done over the last 40 years. 

Now before August 24th  2015 and  prior to the renewal of Exploration number 58 in November 2015 GRAM will have to pay another US$50 million to Xstrata Mining Ltd to satisfy the terms of the deed of sales initially entered into between Pan Aust Ltd and Xstrata-Glencore Mining Ltd for the purchase of the Xstrata Glencore interest in Frieda River Ltd, the company that owns EL58. This piece of transaction is contentious in view of Decision 265/2014 and it is my fervent appeal to the Government  and its Ministers and the Prime Minister in particular  to take control over Agencies of the State and to provide leadership to ensure that the national Interest remains protected and that our resources and developed and shared in the manner enshrined in our Constitution and that we should never again allow our Resources such as Frieda to be sold Cheaply to any Foreign Interest. 

The Future of Frieda.

I re iterate my views that have been  Stated elsewhere that Frieda must be 100% owned by the State and that Frieda be developed by the State through Contract Mining and Management through Profit Sharing Arrangement away from a rent based regime and that Frieda should form the basis of the way  we should develop our Extractive Industries differently going forward in the next 40 years.

G.Ramoi LLB
Port Moresby 27th May 2015

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