Preparing for the start line
Panaust is keen to begin development of the Frieda River copper and gold project but there are obstacles to overcome.
There is little doubt that the Frieda River mine in West Sepik Province is a world-class resource. Panaust Managing Director Fred Hess says its value is well understood and that it ‘has been known about’ for almost 50 years.
The company is currently waiting for permit approval. Once that has been received, the company will then consider what the environment is like for making an investment decision. Hess says the mine ‘is in the top 10 copper deposits in the world.’ But he adds that there is a number of conditions that will have to be met ‘in order for us to proceed to that investment decision.’
The engineering challenges are considerable. Hess has described the project as a substantial open-cut mining operation dominated by a very large storage facility that is designed to take the tailings from the processing plant and the waste from the mine. That sits behind a very large embankment, which will take about 40 per cent of the capital cost.
‘It doesn’t produce any copper but it is a necessary requirement in order to produce copper. It is distinctive in the sense that PNG has traditionally taken cheaper forms of tailings and waste disposal routes.
‘But, because of the issues that we have with Frieda River being upstream from the Sepik River, this is the solution we have come up with, which we think addresses all the environmental issues that are so important to a project like this succeeding.’
‘The other special part of this project is that, because of the size of the embankment, because of the size of the catchment it sits in and the amount of water that falls as rain and gets collected in the catchment, and because of the height of the embankment, the opportunity to produce hydro-electric power also presents itself.
‘That makes it a unique storage facility, in our assessment, in being able to store not only tailings, mining waste and water but it can generate a return in terms of hydroelectricity.’
World scale deposit
Hess argues that the project is of national significance, describing it as a ‘world scale deposit’. Although it will create many jobs for locals, he warns there are challenges ahead. ‘There are no free lunches. We must be mindful of the risks of developing large-scale projects. Frieda River has substantial logistical challenges. It is inland; there are no roads.
‘If you look at the terrain, it is relatively mountainous and it has a high level of rainfall all year round. That makes it a challenging environment in terms of building stable structures and undertaking the whole construction effort.’
THE MINE IS IN THE TOP 10 COPPER DEPOSITS IN THE WORLD. Fred Hess