Subsea miner terminates PNG agreement

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 05 Mar 2014   Posted by admin


THE world’s first seabed mining operation could be back on track after Nautilus Minerals ended months of uncertainty by terminating its agreement with the State of PNG.
A statement released by the company made it clear that the PNG Government had failed to purchase a 30 per cent interest in the Solwara 1 project, contrary to an arbitrator’s award issued in October last year.
In accordance with the State Equity Option Agreement (SEOA) signed by the parties in March 2011, Nautilus terminated the agreement and would now claim damages.
“A commercial resolution with the state has not been achieved in a reasonable timeframe,” Nautilus reported in an 18 February investor update.
“There was too much uncertainty created by the state’s continued non-performance under the SEOA.
“Nautilus could not continue to carry the share of the development costs for the project on behalf of the state.”
The PNG Government has forfeited any rights to participate in the project, any project equipment, intellectual property, and licences, but Nautilus remained hopeful that an amicable resolution could be achieved.
“We still have significant support from the state at both ministerial and bureaucratic levels and continue to have strong levels and continue to have strong community support,” the company said.
Nautilus said it was now free to explore other development and funding options with the support of its major shareholders MB Holding Company (28 per cent), Metalloinvest (20.75 per cent) and Anglo American (5.95 per cent).
Nautilus would look to secure additional capital to complete equipment build, finalise shipyard selection and financing arrangements, and ensure continued government and community support.