Ok Tedi restructures as metal prices fall; happy with ‘independence’ commitment
Prime Minister O’Neill’s promise to leave the management of Ok Tedi Mining Ltd in place when his government takes over the mine is ‘very reassuring’, according to the company’s managing director, Nigel Parker.
Nigel Parker, Managing Director, Ok Tedi Mining Ltd
O’Neill has said his government will take full ownership of Ok Tedi Mining Ltd (OTML) and the Ok Tedi mine at the end of 2013 and regulatory approvals for a mine life extension will follow.
BHP transferred its 52% OTML equity to PNG sustainable Development Program Limited, a special purpose Singaporean company limited by guarantee in 2002. The current shareholding in OTML is 63.4% owned by PNG Sustainable Development Program Limited. The national government owns the remaining 36.6% stake of OTML.
O’Neill assured staff at a meeting in the mine’s township, Tabubil, last week that there would be no political interference in thefuture running of the copper and gold mine, MD Nigel Parker told Business Advantage PNG.
He said staff had been worried about the transition of the company to a state-owned enterprise.
‘He has been extraordinarily consistent with me over the last 10 months or so,’ said Parker, adding O’Neill had said he recognised the need for the expertise that OTML has to offer the State in support of exploration and mining.
There will be an independent executive and management as well as an independent board, he said.
‘I am very, very bullish about the company and its future.’
Company restructure
Parker has told employees in a memo that the company will be reducing the size of its workforce, reducing costs and increasing productivity, as a result of ‘the toughest period in our history’.
‘Two of the issues we are facing are that metal prices are falling and demand for our metal products is slowing and we are feeling the effects.’
Ok Tedi Ltd will be restructured to run with a smaller lower grade ore body, a smaller mine, producing less and making less money – about a third less, he wrote.
The restructuring may include some job losses, but is focusing on shift and roster changes, and accommodation changes, which will be implemented by the end of the year.
