Ok Tedi Mining Limited (OTML) has suspended normal operations at its mine in Papua New Guinea for at least 14 days to limit further transmission of COVID-19 and allow for contact tracing, isolation and testing procedures to be implemented after seven people tested positive for the novel coronavirus.
The cases occurred despite OTML implementing a shutdown of all charter flights in and out of Tabubil on 28 July in response to the escalation of positive cases in Port Moresby. The source of transmission for these new cases was a person who travelled from Port Moresby to Kiunga on 31 July on a commercial airline. As a result, the company is strictly limiting the movement of people between its operational sites located at Tabubil, Bige and Kiunga, and seeking support for commercial air services into Kiunga to cease.
OTML Managing Director and CEO Musje Werror said its workforce and the Tabubil community have responded positively to the additional control measures and remains hopeful that the company’s decisive action will limit the potential impact of the virus.
He said that the mine has been performing strongly this year and was therefore in a healthy cash and liquidity position. The company is well positioned to withstand the financial impact of the 14-day suspension, which is estimated to be in the order of PGK100M.
Beyond this financial impact on OTML, the 14-day shutdown will have broader economic impacts. OTML generates a significant amount of foreign currency inflows into Papua New Guinea and the suspension is likely to reduce U.S. dollar receipts by approximately $40 million. It will also reduce copper and gold production by approximately 4,000 tonnes and 12,000 ounces, respectively.
Mr Werror said a decision to return to normal operations will be governed by the company’s duty of care to its workforce and that “operations will resume when we are confident our workforce will not be infected with COVID-19 virus whilst going about their normal day to day work”.
He said “at this stage we are hopeful resumption of operations will occur at the conclusion of the 14-day lockdown and quarantine period. However, we cannot be certain until results from further contact tracing are available”.