Government link to gold mine's 'prohibited' waste

The case of an Export Finance and Insurance Corporation (EFIC) supported mine, Lihir mine in Papua New Guinea was heard at the international convention which bans waste dumping from ships (The London Convention) this week. This is the resulting story.

Government link to gold mine's 'prohibited' waste

By Greg Roberts

Sydney Morning Herald, Australia, November 16 2002

The Federal Government is under fire for failing to verify independently that a controversial mine dumping operation by an Australian-listed company in Papua New Guinea complied with environmental standards.

A Greenpeace report claims that waste dumping from the lucrative Lihir gold mine on Lihir Island breaches the London Convention, an international treaty governing waste disposal at sea.

At the same time, an internal report by Lihir Gold, the mine's operator, reveals that a "disappointing number of environmental incidents" have occurred at the mine.

The $1.3 billion operation is pumping 110 million cubic metres of waste into the sea each year through a subterranean pipeline. It is also dumping 20 million tonnes of rock waste a year into the sea from barges.

Some Lihir Island residents say the mine is damaging marine life and their traditional lifestyle. The company insists the operation is environmentally sound.

The mine has extensive Australian involvement. It began production in 1997 after the Federal Government's Export Finance and Insurance Corporation (EFIC) provided political risk insurance, which had been denied on environmental grounds by its United States government equivalent.

Samples were collected late last year on the island from clay and rocky material near gold deposits. The Greenpeace report - presented yesterday to a meeting of the London Convention in Britain - detailed the analyses of these samples.

The report said arsenic concentrations were between 135 and 387 milligrams a kilogram - up to seven times higher than the maximum expected in uncontaminated soils; mercury levels were up to five times higher. The material being dumped is "clearly" industrial waste and its dumping is prohibited under the London Convention, the report said.

Lihir Gold's Community and Environment Report for 2001 said that despite efforts to minimise environmental impacts incidents included oil-contaminated run-off from a dump site, which killed prawns in a creek nearby. In other incidents, small leaks from the mine's tailing discharge tank occurred after power failures.

However, the company's report said strict environmental management ensured that "metals and chemicals contained in mining waste deposited into the ocean have no adverse effect on the water quality or marine organisms".

Australia and Papua New Guinea are signatories to the London Convention. Simon Divecha, campaign co-ordinator of Australia's Mineral Policy Institute, said the mine could not have proceeded if EFIC had refused risk insurance. "The Australian Government is responsible and has to act to rectify the situation," he said. "We should expect our companies and government to apply the same standards overseas that operate here."