Local ownership defines today’s Bougainville Copper Limited (BCL). The ownership status of BCL today is entirely different to when the Panguna mine ceased operations 30 years ago.
There appears confusion within the community around the shareholding of BCL and there are some important points that are worth clarifying.
Firstly, BCL today is an independent, PNG company that is predominantly owned by locals.
It is important to note that Rio Tinto no longer has any ownership stake or association with the company after it fully exited back in mid-2016. At that time, it relinquished its 53.8% shareholding to independent trustees for the subsequent transfer of ownership to the PNG and Bougainville governments.
As a result, 72.8% of BCL’s shares are now collectively owned by the Independent State of Papua New Guinea and the Autonomous Bougainville Government. Each has a 36.4% stake in BCL. The remaining shares are owned by public and institutional investors as the following table shows.
When Rio Tinto announced that its shares would be transferred for local benefit they stated that: “by distributing our share in this way, we aim to provide landowners, those closest to the mine, and all the people of Bougainville a greater say in the future of Panguna.”
It is also worth noting that Bougainville’s share of BCL ownership may further increase in the future to 53.8% based on a commitment by former PNG prime minister Peter O’Neill in July 2018 to transfer 17.4% of the PNG shareholding for the benefit of the people of Bougainville including the Panguna landowners. This is yet to be finalised.
What does this mean for Bougainville?
Bougainville’s strong ownership stake in BCL since 2016 has always had the potential to deliver significant local benefits under any successful future redevelopment of the Panguna mine that the company leads.
A viable mining operation would be expected to translate into greater shareholder value and, also produce significant tax revenue to support the development of such things as local infrastructure and community services. There would also be mining royalties paid and compensation payments made to project area landowners as defined in the 2015 Bougainville Mining Act.
The preliminary works and construction of the mine along with the ongoing operations would support the development of local businesses and provide opportunities for the provision of mine-related goods and services. It would also help support the broader development of other important sectors such as fisheries and agriculture, construction, tourism and transport.
A mining operation would also provide a wide range of direct employment, education and training opportunities that would build new levels of capacity in the local workforce that would benefit the region in the years and decades ahead.
Any future development of Panguna with BCL’s involvement will of course only be realised with the unequivocal support of government, landowners and the community more broadly.
As a company, BCL has a strong local board and management team that knows Bougainville extremely well. The board is led by respected Bougainvillean-born chairman Sir Melchior Togolo and is committed to increasing its Bougainvillean representation.
At the AGM held in 2019, Sir Melchior stated: “The board is actively pursuing additional Bougainvillean appointments and are conducting due diligence on one female Bougainvillean and one male Bougainvillean. In addition, requests have been made to the ABG for recommendations.”
BCL is also firmly committed to providing employment opportunities for local people and of 18 current full-time staff, all but one is PNG/Bougainvillean. The team includes project officers on the ground in Bougainville as well as a network of village liaison officers who are integral to building relationships with local people.
The company has been and continues to provide sponsorship and support for worthy community projects in areas such as education, health, agriculture and sport.