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Australian Current Affairs

Australia’s BHP lashed on ‘colonial attitude’ in Papua New Guinea

Peter O'Neill

Peter O’Neill

The row between Papua New Guinea and BHP Billiton over the Ok Tedi mine heated up yesterday, with Prime Minister Peter O’Neill accusing BHP of having a “colonial era” mentality.

He strongly defended his action two months ago in banning Ross Garnaut from PNG, which triggered the Australian economist’s resignation at the weekend as chairman of the country’s biggest-earning company, Ok Tedi Mining.

Professor Garnaut stepped down in November as chairman of the PNG Sustainable Development Program, the trust to which BHP assigned control of Ok Tedi — whose annual output is about $4.5 billion — when it closed the massive copper and gold mine a decade ago after environmental issues.

Just before his ban, Professor Garnaut had told The Australian, in explaining the success of the program, that “naturally, with such an accumulation of wealth in a poor country, it’s very tempting for political figures to think of better ways of using it right now than putting it into long-term development”.

Last night he told the Australia Network his ban was “a low point for Australian diplomacy generally, a low point for PNG development and a low point for PNG democracy”. He said such “misuse of immigration powers” could introduce “a major new element of sovereign risk”.

Mr O’Neill, whose country’s mining boom is driven largely by $16bn in Australian investment, said yesterday: “Claims that I had blocked the granting or extension of exploration licences (to BHP) because it would not agree with my proposals regarding the determination of the board of PNGSDP are totally and utterly false.”

He said BHP had been done “an enormous favour by the then PNG government and allowed to exit ownership of the Ok Tedi mine without accepting any financial or moral responsibility for the enormous environmental and social damage . . . in the 20 years it operated the mine”.

He said BHP needed to “get over its colonial-era mentality and appreciate that PNG was an independent nation”.

A BHP spokesman responded that the company had established PNGSDP, “an independent company which has provided a lasting legacy for the people of PNG” by ensuring it received all of Ok Tedi’s profits.

A Department of Foreign Affairs and Trade spokeswoman said: “Our high commissioner has raised the PNG government’s criticisms of Ross Garnaut . . . Ultimately it is for PNG to determine who is permitted to visit that country.”

Source: The Australian “BHP lashed on ‘colonial attitude'”

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