PanAust looks for ‘social licence’ to operate Frieda River mine in Papua New Guinea


Frieda River Ltd, the wholly-owned Papua New Guinea subsidiary of PanAust, has lodged a Special Mining Lease application with PNG’s Mineral Resources Authority to develop the Frieda River Copper-Gold Project. Glen Connell, PanAust’s General Manager, Government and Community Relations, tells Business Advantage PNG that developing a ‘social licence’ to operate is critically important for the success of the project.

Frieda River camp. Source: PanAust

Frieda River camp. Source: PanAust

With a potentially long term operation, Glen Connell says establishing a sound relationship with the community is fundamental:

‘If you don’t have the social licence to operate you won’t have any longevity whatsoever. I think we have long accepted that and it is something that we have learned in Laos.

‘It put us in good stead in that country, which wasn’t a mature mining investment destination when we went in. The key very much to our success in Laos has been community engagement, good environmental practices, strong safety performance, and looking after our people.

‘Whether it is PNG, or anywhere else in the world, the same philosophy applies.’

‘I guess the trick is to work out how you tailor that to any given situation. Whether it is PNG, or anywhere else in the world, the same philosophy applies.’


The Frieda River Joint Venture is 80 per cent owned by PanAust, which is in turn owned by Guangdong Rising H.K., a subsidiary of the Chinese State Owned Enterprise Guangdong Rising Assets Management Company (GRAM). Highlands Pacific owns the remaining 20 per cent stake. Frieda River Limited is the manager of the JV.

Story continues after advertisment...

‘PNG is a more mature mining destination with decades of experience.’

The PNG government has a right to acquire at cost up to 30 per cent of the project.

PanAust's Glen Connell and Frieda River local

PanAust’s Glen Connell (left) and Lebin Ulamtemab in Wameimin Village 1. Source: PanAust

The Joint Venture’s recently released feasibility study claimed the potential mine is ‘one of the largest undeveloped copper-gold deposits in the world’, with an initial 17-year mine life.

Connell says there are similarities between Laos and PNG. Both nations are developing countries and in similar socio-economic situations. But he says there are some crucial differences.

‘PNG is a more mature mining destination with decades of experience,’ he says. ‘The legislative frameworks are well developed; the bureaucracy understands mining and is attuned to it.’

Long term outlook

Connell says the company does not focus on short-term fluctuations in metals prices. He says that periods of weaker prices often represent the best times to be advancing and building projects.

‘You need a little bit of tunnel vision.’

‘It is not about what today’s copper or gold prices are and projecting those forward for the next six months. We are looking at a project that could operate for decades.

‘So, we look at what the longer term outlook is and I think with copper it is safe to say that most, if not all, analysts see a good future for copper. If not in the near term then certainly in the medium to longer term. We share that view.’


Connell says falling interest rates in the developed world means a potentially lower cost of capital. ‘But the external environment will do what the external environment does. You design the most robust project you can and you seek to deliver it.

‘We have been in close contact at all levels of government and other stake holders to make sure that we secure the business licence.’

‘You need a little bit of tunnel vision in that regard. At the same time, we have to think about the long term price of oil, or any given commodity, or economic factor that you have to deal with.

‘It all comes down to the robustness of the design, development, implementation and your ability to operate. I think we have ticked the box on each of those in Laos and there is no reason to think we won’t do the same in PNG.’

Now that the application for a Special Mining Lease has been lodged, Connell is not willing to speculate about how long the approval process will take. ‘We have been in close contact at all levels of government and other stake holders to make sure that we secure the business licence to operate as well as the social licence to operate. That process has been positive.

‘But I can’t answer how long it will take. It is not a process that we can control,’ he tells Business Advantage PNG.


  1. I agree with Glen. Social licence is vital for project to achieve sustainable outcome. Companies do not apply for social licence or pay some good amount of money to get it. Instead its ability to do community engagement, respect local cultures and customs, human rights, and help the local communities by investing in community development projects and programs can help gain support and acceptance from the local communities. In addition to operate in an open and transparent manner leads to good community relations.

  2. We thank God that we are being blessed with those natural resources and our future will determine on how we manage those resources. Having Kili Teke from Harmony Gold and Bulago done by Frontier Resources are having Identical results acording to the samples extracted from the Drilled cores, We can’t progress it ourselves at the moment – not enough of us.This is because it is a good outcome for all of us if we can improve access to Bulago.
    Frontiers biggest cost with exploration is air support/ transport. When drilling it is fuel transport costs that are the most, although flying cement just kills me (3 bags – 50kg/ hole normally to stabilise rig base) (Kiunga – Bulago is K20/kg in helicopter, so each 50kg cement bag costs maybe K150 to buy and K1000 to transport!We only need track Access is imperative for future development for our Bulago world class mineral deposits. Without it (roads) there will be none. OK Tedi quote –The results of the soil geochemistry and drilling at Bulago suggest that two high-grade cores located at depth broadly bounded by holes BUL001, 003, 006 and BUL007 in the north and at depth broadly bounded by holes BUL002, 004,005 in the east. As same situation, Frieda river project will also be airlifting the fuels and logistics.

  3. Rex Tawian says

    Can someone clarify or give me a figure on the payback time for the development cost of this project..We need to heard in detail…The Government had failed in Bougainville, Pogera and OkTedi…Fly is less populated, and its deep…while the Sepik banks are densely populated…Sepik is slow and not deep…We are concerned….its our life, our future compensated by any destruction caused by this mine…I am from Green River.. Rex

    • Eganda Hogga Piawi says

      Rex, the financial analysis report is a major component of the Bankable Feasibility Study submitted to the PNG Mining Department/Mineral Resources Authority by the Developer. The Frieda River Project coordinator or a mining engineer from that office will be able to provide that information. With regards to managing the tailings and waste rocks from the mining operations and impact on the Sepik River, there was a detailed proposal by Mr John Kawatt, a Senior Geotechnical Engineer earlier this year, you may want to contact him and also Mr Samson Torovi from the East Sepik Provincial Government and discuss with them. Cheers bro Eganda.

Leave a Reply