Ramu Nickel LOs demand legacy issues resolved before expansion and CDA talks
The four principal Landowners Associations [LOAs] of the Chinese-operated Ramu Nickel and Cobalt project in Madang Province have jointly resolved not to participate in the proposed Community Development Agreement [CDA] negotiations, scheduled for Lae later this month, unless critical outstanding issues affecting the existing project are properly addressed.
The landowners explained in a joint press statement issued over the weekend that their decision does not oppose the project or any further developments, rather a protest against proceeding with negotiations for a new CDA, whilst fundamental questions concerning historical royalties, compensation, relocation, employment, business opportunities, environmental and social impacts remain unresolved.
They demand that the royalty payments from 2013-2025 must be verified.
The four LOA chairmen, Steven Saud for Coastal Pipeline, Yavina Kassima [Maigari], Kuai Dup [Basamuk], and John Tigavu, vice chairman for Kurumbukari, released the signed statement, raising their immediate concern is whether the royalties paid to customary landowners from the commencement of commercial production in 2013 through to 2025 were correctly calculated.
The company has previously explained that its royalty methodology includes the use of Net Smelter Returns [NSR] for Mixed Hydroxide Precipitate [MHP] and Free on Board [FOB] revenue for chromium concentrate, together with deductions associated with refinery and processing operations.
However, the landowners believe a transparent reconciliation is necessary to establish whether the amounts paid were in fact the amounts legally and contractually payable.
They are demanding that an independent royalty audit covering 2013 to 2025 be conducted to examine production and sales records, product valuation, royalty rates methodology, NSR and FOB calculations, all deductions and the actual royalties calculated, paid and distributed.
"If the royalties are correct, let the records and an independent audit prove it. If there has been a shortfall, let the audit establish the amount and let the outstanding royalties be paid," the landowners said in a statement.
They added that the immediate issue is whether the customary landowners have received the correct royalties under the existing Ramu Nickel Project arrangements or not.
The landowners further stated that they do not accept that their participation in a future CDA negotiation should automatically mean acceptance of historical royalty payments as full and final settlement.
Meanwhile, other issues they have also raised include outstanding compensation and relocation, fair employment, and business opportunities, plus environmental and community concerns.
The four LOAs maintain that all outstanding compensation and relocation issues associated with the existing project must be addressed before any further expansion can proceed.
They are also concerned about the unequal distribution of employment and project- related business opportunities amongst the four LOAs.
They want the proposed expansion to establish a transparent and equitable framework for landowner participation.
The landowners continue to raise concerns about environmental and social impacts associated with the existing operation, particularly around Basamuk and Kurumbukari.
These include concerns about accumulated waste materials, emissions, fumes, dust and noise, as well as the need for a comprehensive environmental, health and demographic assessments across the project footprint.
The four LOAs are calling upon Ramu NiCo Management [MCC] Limited and the National Government to immediately establish a joint mechanism involving them to address these outstanding matters.