Lihir pays over K17m in royalty payments

Lihir Gold Limited (LGL) has paid K17,737,552 in royalty payments for the March quarter to the New Ireland Provincial Government (NIPG), the Nimamar Local Level Government (NLLG) and traditional Block Owners of the Special Mining Lease (SML) area.

This brings the total royalty payments since June 1997 to K755 million.

From the K17,737,552, the NIPG received its 50 percent share of K8,868,776, the NLLG received its 30 percent share of

K5,321,266 and the Lihir SML block owners received its 20 percent share of K3,547,510. These payments were distributed according to the Memorandum of Agreement (MOA) signed by the State with NIPG, NLLG and the Lihir Mining Area Landowners Association (LMALA).

Between June 1997 and March 2019, LGL has paid K378 million to the NIPG, K226 million to the NLLG and K151 million to the SML block owners.

The MOA requires the NIPG to distribute 20 percent of its royalty payments to the Namatanai district and 20 percent to the Kavieng district for infrastructure projects and programs pursuant to its Districts and Provincial Development Plans. Additionally, the MOA requires the NIPG to use 10 percent of its royalty portion for general administration, which includes the administration of the MOA obligations.

For the 30 percent NLLG royalty portion, the MOA states that 20 percent is for community development projects and programs and 10 percent is for long term growth-driven investments.

All royalty payments to SML block owners are made ‘net of tax’. Once tax has been deducted, the royalty portion is paid to the SML block executives. The executives have agreed on an arrangement with LMALA for LGL to deduct a 20 percent portion of these funds each month to go towards savings. The 20 percent portion is paid into a Financial Savings Scheme managed by Mineral Resources Lihir Capital Ltd (MRLC). The remaining 80 percent net of tax amount is paid directly to the SML block executives to distribute to the SML block owners.

Author: 
Press release