Bougainville's Path to Independence

By Kirsty Needham

SYDNEY (Reuters) – Bougainville must secure funding for at least half of its budget to achieve political independence from Papua New Guinea (PNG), stated PNG Prime Minister James Marape on Wednesday.

Bougainville President Ishmael Toroama is actively seeking international investors to reopen one of the world’s largest copper mines, with Marape supporting his authority to make business decisions related to the mine as the region works towards independence.

For two decades, Bougainville was PNG’s economic powerhouse until a violent civil war broke out in 1989 over revenue from the Panguna mine, the world's third-largest open-cut gold and copper mine operated by Rio Tinto.

Bougainville voted for independence during a 2001 peace process in a referendum held five years ago, but PNG’s parliament still needs to endorse this decision. Recently, a New Zealand mediator was appointed to assist in this process.

"We start with economic independence as a fundamental basis, because once you have the money you are able to sustain," Marape said at a resources conference in Sydney. He noted that Bougainville’s internal revenue of only 7% is inadequate for progress. "We need to raise this at the very earliest to about 50% of funding."

Toroama highlighted significant advances in redeveloping Panguna this year, including a copper exploration license granted in January to Bougainville Copper Limited (BCL), which is majority-owned by the Bougainville government. BCL projects $36 billion in revenue from the mine over the next 20 years, with copper being vital for renewable energy.

An environmental and social impact assessment of Rio Tinto’s previous mining operations was also noted as a critical milestone for reopening the mine.

"We must further sign a memorandum of understanding with Rio Tinto and Bougainville Copper Limited for the commencement of works addressing aging infrastructure that pose risks to communities and to continue discussions," Toroama stated.

He lamented that previous revenue from the mine had detrimental effects on local communities and the environment, leading to civil unrest fueled by political issues during the war that claimed 20,000 lives.

"Bougainville continues to stand out as a lesson, a warning, a reminder of what not to do in resource sector development," he concluded.