PNG Chamber of Resources and Energy (PNG CORE) President Anthony Smaré has questioned why Refinery Holdings Limited of Singapore is being preferred over Kumul Minerals to build and operate a new gold refinery in PNG.
In his information briefing to the business community last week, Mr Smare outlined the lack of financial resources, gold experience and technical capacity of small Singaporean company Refinery Holdings Pte Ltd and questioned why they were being preferred to PNG’s own Kumul Minerals Holdings Limited.
“The National Gold Bill and its regulatory gold monopoly, overriding of 26 important laws, the restriction of important Bank of PNG’s independent powers in relation to control of monetary issuance and regulation of Banks, is designed to favour this small Singaporean company Refinery Holdings Pte Ltd. But a report obtained by PNG CORE shows that Refinery Holdings’ last financial results filed in June 2023 indicate that the company is worth around minus $20million.
“They are worth less than a settlement tuckerbox – so why are they being given all these preferential rights to take over all of PNG’s gold production from a billion-dollar industry that sustains millions of Papua New Guineans? That Refinery Holdings company has no experience or track record in the gold industry or in gold refining, and they do not have the financial capacity to undertake the operations envisaged by their agreement with the State.”
“The PNG mining industry has no objection to a new gold refinery being built, but it does not need to be done under any special new laws or under an environment of a regulated gold monopoly. If a gold refinery is to be created, it can be done by existing operators in PNG such as Kumul Minerals.
Kumul Minerals is the natural State vehicle to undertake refining as they have existing experience and investments in the gold industry through Ok Tedi and Porgera and the company is worth over 8billion kina. They are staffed by PNG professionals who are well versed in all aspects of the gold industry. Kumul Minerals are also in feasibility studies with Ramu Nico on the development of a base metals’ smelter in the country, so a gold refinery is consistent with their mandate.
“A new gold refinery with capacity to process 3 million ounces of gold can be built in either Lae or Port Moresby for an estimate of K60 million. This is well within the financial capacity of Kumul Minerals. Although the gold refinery business traditionally has very thin margins, it is our view that Kumul Minerals has the capacity and capability to make it work.
“Better yet, Kumul Minerals can build a 100% PNG-owned gold refinery without an NGC Bill, without a gold monopoly, without a gold police, without any attacks on the independence of the Bank of PNG, without overriding all the project agreements of existing mines, and without over-riding 26 important PNG laws and impacting the work of the other important government agencies and departments that serve the PNG people.