Ok Tedi lease in PNG won't be renewed

Papua New Guinea Prime Minister Peter O'Neill

Papua New Guinea will not extend the mining lease for Ok Tedi Mining Ltd, officials say. Source: AAP
PAPUA New Guinea will not extend the mining lease for Ok Tedi Mining Ltd (OTML), Prime Minister Peter O'Neill says.
Mr O'Neill has told PNG's single House of Parliament on Wednesday the state will also take control of the multi-million dollar Papua New Guinea Sustainable Development Program when the lease is up.
The relationship between OTML and the country was like a broken marriage, he said.
"The marriage is not working," the National Newspaper quoted Mr O'Neill as saying.
"When the lease expires (in 2014), this government, as a partner and director, will not allow or grant an extension."
A spokesperson from Ok Tedi declined to comment.
In early February Mr O'Neill made public comments indicating he would not grant an extension to the lease.
In response to a question in parliament, Mr O'Neill said the government would own and operate the mine, which is located in the Star Mountains of PNG's Western Province, through the PNGSDP.
"We will restructure the PNGSDP with our own people managing it, not by strange people who live beyond and do not know our needs," he said on Wednesday.
Mr O'Neill left PNG on Thursday for a three day visit to Japan.
A report by former majority owner BHP in 1999 found the mine was the cause of "major environmental damage" and in 2002 it pulled out and placed its 63 per cent ownership in the PNGSDP.
Late last year Mr O'Neill ordered economist and former PNGSDP chairman Ross Garnaut banned from PNG. In November former prime minister Sir Mekere Morauta took on the chairmanship of PNGSDP.
PNGSDP has declined to comment.

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