It has been a long voyage, but Canada-listed copper-gold explorer Nautilus Minerals is on track to commence deep-sea mining operations at its Solwara 1 deposit in the Bismarck Sea, off Papua New Guinea. Business Advantage PNG talks exclusively to CEO Mike Johnston about the project.

Nautilus has recently taken delivery of three seafloor mining machines. Credit: Nautilus Minerals

The company expects to commence operations at the world-first underwater mining project in the first quarter of 2018.

Nautilus Chief Executive Officer, Mike Johnston, tells Business Advantage PNG that has recently taken delivery of the three seafloor mining machines, collectively worth over $100 million.

‘It must be one of the only mining projects I know of in the world where we don’t end up with tailings.’

Johnston said construction of all the other hard components for the project—the riser and lifting systems that will be needed to convey minerals from deep below the ocean’s surface, and the huge floating vessel that will act as a refinery to process and refine the extracted material—were well on track.

Nautilus Minerals’ Mike Johnston

Major boost

The Solwara 1 project received a significant added boost late last year when Nautilus signed an offtake agreement with the Chinese State Owned Enterprise Tongling Nonferrous Metals Group, under which Tongling will buy the bulk of all production from Solwara 1.

‘Under the deal, they have to take all our production up to 1.44 million tonnes,’ says Johnston. ‘However, we have the option to sell up to 20% of our product elsewhere if needs be.’

He also confirmed that, under the new agreement, Tongling will take all the high-grade material produced from Solwara 1 directly to China, effectively removing all the associated tailings.

‘So, it must be one of the only mining projects I know of in the world where we don’t end up with tailings.’

Social benefits

Under separate Memorandums of Understanding with PNG’s New Ireland and East New Britain provinces, Nautilus is continuing to develop social programs in the regions adjacent to its mining activities.

These include the delivery of a water and sanitation program, which will see schools receive new toilets and freshwater infrastructure. The company has also completed site investigations for a number of river crossings in preparation for the construction of bridges along the west coast of New Ireland.

Nautilus is also working with the provincial government and other groups to explore other business opportunities in the region including the potential to revive its cocoa and copra industry.

‘We’re very conscious of the fact that it has to be a lasting legacy.’

‘There are different uses now coming through for cocoa and copra, so we’re trying to get that happening,’ he says.

A vessel used during the Solwara 1 projects exploration phase. Credit: Nautilus Minerals

Local employment

Johnston added that other areas being considered by Nautilus included the potential to buy local food produce for its mining operation, and the opportunity to significantly boost local employment once the operation begins.

This could be achieved by running multiple worker shifts at the company’s sites.

‘There are people from the communities nearest to Solwara 1 who potentially will be able to do semi-skilled tasks when they’re trained,’ he says. ‘We have a CSR Strategic Plan, which is being delivered alongside the relevant provincial governments, which will see community-based programs delivered in the villages nearest to the project site.

‘But also we’re very conscious of the fact that it has to be a lasting legacy; there has to be infrastructure and community programs which can help build the foundation for a better life for the people.’