Mining giant Rio Tinto is considering the future of its key stake in a company that has lost the right to mine in Bougainville.
Bougainville Copper was stripped of all exploration and mining licences by the autonomous Bougainville government last week.
“Rio Tinto has decided now is an appropriate time to review all options for its 53.83 per cent stake in Bougainville Copper,” the mining giant said on Monday.
Bougainville Copper owns the Panguna mine, and the company has been in discussions with the government of Papua New Guinea, the Bougainville government and landowners about a potential return to mining.
Rio’s statement appears stronger than last week’s comments by Bougainville Copper managing director Peter Taylor, who has not ruled out legal action, but said pulling out of the project was not being considered.
The controversial mine was closed 25 years ago and was a key component in Bougainville’s bloody civil war that ended in 2001.
Locals fiercely resisted the open pit – then one of the world’s largest copper mines – arguing they saw little revenue and it was causing environmental and social problems.
Bougainville’s government is interested in re-opening the mine because it would potentially benefit the local economy, but is using its new Mining Act legislation to put itself in a stronger bargaining position.