from oilfields

Good news from oilfields

THE continuing gloom surrounding the Bougainville copper mine in Papua New Guinea some sources say it could be six months before full production is resumed has been at least partly offset by good news from the lagifu and Hedinia oilfields. Chev ron Niugini, the subsidiary of the giant American-owned Chevron Corporation, has been undertaking land surveys for a 330-kilometre pipeline to carry the oil to the Gulf Province port of Kerema.

By November the company is expected to know whether the project is viable, and the country will be pinning its hopes on the likely event that the pipeline will go ahead. Chevron’s public relations manager, Brad LeDu, says the drilling results are “very positive”.

The one major problem, apart from the terrain between the oilfields and the sea, will be negotiations with landowners.

One local member and the Minister for Fisheries and Marine Resources, Allan Ebu, has said no pipeline would be built unless landowners were satisfied. Ebu has demanded that Chervon Niugini set aside a contingency financial package for local people in case of a serious oil spil lage, and that the company be ready to move in and clean up any spill.

LeDu said the company had con ducted meetings with local people and they had been assured the pipeline would not harm the environment. He said Chervon would build it to the best safety standards, and that it was the only cost-effective way in which to transport huge quantities of oil overland.

Drilling has indicated encouraging re sults, with one well producing 1110 bar rels a day.

Meanwhile, the North Solomons pro vincial government has cut its budget spending proposals by almost a half be cause of the Bougainville crisis. Travel, overtime and transport hire by govern ment employees has been banned unless

absolutely essential.

The production totals from the giant Panguna mine up to the end of the June quarter illustrate just how the company has been hit since the mine closed on May 15: copper output was 28,080 ton nes and gold 1465 kg compared with 42,712 tonnes and 3909 kg respectively for the previous corresponding period.

The national government in Port Mores by is losing about K 3 million a week in revenue since the mine closed.

The full impact on Bougainville Cop per Ltd’s earnings may not be felt until the quarter now under way because the company was still making shipments af ter the mine closed.

Even if peace is restored, the mining company will have trouble getting an early re-start on operations. Skilled workers have left the North Solomons province for jobs elsewhere, while many expatriates who have fled Papua New Guinea are not expected to want to re turn. The company also has some mechanical problems to remedy when the mine re-opens. □