Lihir and Its Gold Mine

The Lihir Islands are situated off the east coast of mainland New Ireland and are divided into 15 local-level government wards. Lihir Island (a.k.a. Aniolam Island, Niolam Island) is the largest island in the Lihir group of islands, 22 km long and 14.5 km wide.

Taim Bipo (History)

Pre History

Papua New Guinea (PNG) and Australia were originally linked up by land up until about 6,000 years ago. As the last Ice Age ended and ocean levels rose, the waters of Pacific and Indian Oceans poured through the Torres Straights and cut off the Australian continent from the world’s second largest island. Human remains have been found in PNG which have been dated to about 50,000 years ago.

It is most likely that Lihir was settled during this second wave of colonisation with, or subsequent to, Lapita around 3,200 years ago. This is because the Lapita Cultural Complex includes agricultural technology including gardening and domesticated pigs, dogs and chickens. On an island the size of Lihir it is likely that only agriculture could have provided adequate nutrition to support a viable long-term population.

In more recent times (500 years), pottery was also traded/exchanged in the region. Archaeologists have noted the movement of pottery north from Malasang village in Buka. There were a series of trade/exchange partners linking Buka to Nissan, to Anir to Namatanai & Tanga to Lihir & New Ireland and Tabar. Given the presence of Buka ware (style) pottery on Anir it is highly likely that it was brought to Lihir as well. This suggests a southern trade/exchange connection for Lihirians. On the basis of the obsidian and pottery evidence it is highly likely that Lihirians traded/exchanged with neighbours to the north, south and west to New Ireland.

These trade and exchange partnership linked Lihirians to other New Irelanders through complex relationships of mutual obligation. Many of these exchanges occurred within the context of large-scale mortuary feasting, or funeral rituals. Lihirians maintained the closest trade/exchange relationships with New Irelanders from the Namatanai district on mainland New Ireland, the islands of Tanga to the South East, and the islands of Tabar to the North West.

Archaeological studies have identified aspects of trade/exchange throughout New Ireland as early as 20,000 years ago. The most useful dataset for determining the antiquity of this phenomenon is obsidian. Prior to 3,200 years ago the majority of obsidian brought into New Ireland came from the West New Britain sources at Talasea and inland at Mopir. After 3,200 years ago the dominant source is Manus. If Lihir was colonised at or after 3,200 years ago it might be expected that much of the obsidian found throughout the group is derived from Manus. This suggests that the dominant trade/exchange connections for obsidian in Lihir come from the north. However, obsidian is not the only material known to have been transported throughout the region in the past.

Modern History: 1600s

The first recorded sighting of the Lihir Islands was in 1616 by Dutch explorers Jacob Le Maire and William Cornelisz Schouten. The islands were first named Gerrit de Nijs Eylandt by another Dutchman Abel Janzoon Tasman in 1643 when he navigated through New Guinea onboard the Heemskerck.

An artist onboard named Isaac Gilseman sketched the first image of the Lihir, as well as the famous image of northern New Ireland men in canoe.

The Colonists

Early colonial encounters

Throughout the 1800s miners, missionaries, and merchants were among the main groups to have sustained contact with the people of PNG. Missionaries had been working throughout the south eastern region since at least the 1840s. In the latter part of the 1800s hundreds of Australians and Europeans came in search of gold on Misima, Sudest and Woodlark Island. In the north eastern region German plantation owners drew increasing numbers of local people into plantation labour, while the Queensland sugar industry also utilised Melanesian labour in a process that became known as ‘Blackbirding’.

On November 3 1884 Germany raised their flag in the northern eastern quarter of the country, calling it Kaiser-Wilhelmsland. Three days later the British flag was raised over British New Guinea in Port Moresby. The name of British New Guinea was changed to Papua after Australia assumed responsibility for its administration in 1906.

While Britain and Germany were the colonisers, the names Papua and New Guinea were coined by men from Portugal and Spain. Jorge de Menese, the Portuguese Governor General of the Moluccas first used the name Papua in 1526, taking it from the Malay word pepuah for frizzy hair. The Spaniard explorer, Ynigo Ortiz de Retez, wrote New Guinea (Nueva Guinea) on his map in 1545 because he believed the people resembled people he had earlier seen along the Guinea coast of Africa.

The administration of the two colonies could not have been more different. The Germans chartered a private business firm, the Neu Guinea Kompagnie, to run its colony and pursued and aggressive policy of economic exploitation. Whereas the British, and then the Australians, followed what was then considered an ‘enlightened’ policy of protecting the native people from exploitation and their land from expropriation.

However both administrations faced common difficulties from a lack of unified indigenous political leadership. The population was still mostly scattered in small, isolated, and often hostile groups.

1800s

Lihirians remained relatively marginal to early regional economic and political development, but they were steadily brought under external influence when Germany first raised the flag in North East New Guinea in 1884.

In the 1880s greater numbers of Lihirians became involved in the labour trade for the Queensland sugar industry. Some men and women were recruited against their will in what became known as ‘Blackbirding’. Others volunteered. For instance, in 1883, 649 Lihirians ‘signed on’ for the trade, which was an extraordinary number given that the population at this time was probably less than 3000 people.

1900s German Administration

By 1905 the German Administration had brought more of the Namatanai sub-district under its control. Several villages in Lihir had been organised into administrative units, and eight ‘chiefs’ had been appointed as village assistants to the Administration. These ‘chiefs’ were known as luluais (village police), and tultuls (assistants). By 1912 the German Administration noted that Lihir was peaceful and that internal warfare had ceased.

1900s Exploration

In 1907, Otto Schlaginhauffen left Germany with the Deutsche Marine-Expedition for the Bismark Archipelago. He reached the shores of Lihir at Leo, near Palie in 1908. During his time in Lihir he recorded 19 traditional Lihirian songs on wax cylinders, mapped the main island of Niolam, and documented aspects of Lihirian culture.The songs have been reproduced and reinterpreted on the CD “Music of Lihir” by the Lihir Cultural Heritage Association.

The renowned ethnologist Richard Parkinson who worked throughout New Guinea between 1882 and 1909 also recorded aspects of Lihirian culture.

The Missionaries

Missionary activities

Missionary presence was by far the biggest influence upon Lihirian society. In 1902 the Sacred Heart Catholic Mission sought to expand its influence from Rabaul to New Ireland (then New Macklenburg), concentrating on Lihir and the other outer islands. Despite an early presence, the Palie Catholic Mission Station was not established until 1933.

Similarly although the Methodists had been permanently positioned in Lihir prior to 1933, they never established an official station. The first Lihirian man to be baptised (in 1907) was a ‘reformed cannibal’ named John Targolam from Bulamwei Village on Masahet who was previously languishing in the Namatanai prison. His conversion to Catholicism proved instrumental in the transformation of Lihirian social and religious life; the majority of Lihirians soon aligned themselves with either the Methodists or the Catholics.

Economic and political development

The main form of economic development throughout the colonial period was the copra industry. By the 1950s copra plantations had been established on the Londolovit plateau, which is now the site of the mining camp, and at Hunio and Lakakot. However, the copra industry advanced minimally. Few Lihirians chose to work on these plantations, which amazed and frustrated plantation owners. The association with indentured labour and negative war time experiences may have influenced their reluctance to work. Given the low prices for copra and limited transport options Lihirians were also disinclined to develop their own copra plantations.

Between 1965 and 1970, Lihir underwent three significant developments that paved the way for future change. These were the establishment of ‘progress’ or ‘cooperative’ societies that attempted to generate forms of local development around the copra industry; incorporation into the Namatanai Local Government Council in 1967; and the emergence of entrepreneurial ‘big men’ who gained control over the local copra industry.

The World Wars

Following World War I, the League of Nations granted Australia mandate to administer the former German colony. Both Papua and New Guinea remained under separate administrations until the World War II when the Japanese invaded and took control of all of coastal New Guinea and the Oro and Milne Bay districts of Papua. Their attempts to take Port Moresby from the sea were frustrated by the Battle of the Coral Sea, and over land they were beaten back by the Australians on the Kokoda Track. The war had a huge impact on all of those areas affected by it.

The myth of the all powerful white man was destroyed. Local people who worked with the Americans were astounded to see black soldiers apparently on par with their white comrades, and even the Australian soldiers were friendly in ways unlike their pre war ‘mastas’. Local people also were astonished by the amount of cargo that arrived with the armed forces. The largest navel base in the South-west Pacific was established on Manus, with nearly 1 million Americans passing through as they prepared to attack the Philippines. At the end of the war some 150,000 Japanese soldiers lay dead in the PNG soil.

In New Ireland Japanese garrisons were stationed at Kavieng and Namatanai and missionaries and plantation owners were caught up in the final stages as described in the Battle for Kavieng when the Japanese executed the interned prisoners comprising priests and plantation owners. The German and Italian missionaries from Namatanai and Lihir were caught up in this action.

Lihirians were involved in the Second World War as labourers, carriers and messengers for both the Allied and the Japanese troops. Many elderly Lihirians recall the high number of Lihirians absent during this time and the particularly harsh experiences underneath the Japanese.

Recent History

The most significant political development in Lihir was formation of the Nimamar Association in the early 1980s.

This association would eventually become the Nimamar Rural Local Level Government in 1997 and provide Lihirians with a new level of self-determination. Throughout the colonial period Lihirians were increasingly frustrated by the lack of government attention and economic development. In 1969 Theodore Arau from Matekues village introduced Lihirians to an influential political movement occurring in New Hanover, called the Tutukuvul Isakul Association (TIA), which translates as ‘Stand Together and Work’. Critics of this movement dubbed it the ‘Johnson Cult’ because its members originally sought political annexation underneath the Americans due to their disillusionment with the Australians.

Arau prophesised that radical change would come to Lihir and that the ancestors would return and bring abundant material wealth. People engaged in ritual practices that were designed to usher in this new change. In many respects what people really sought was a way to find some kind of equality with Europeans. The TIA was closely associated with the Catholic Church, and at various times missionaries encouraged TIA members towards more rational economic activities.

The TIA continued to exist as an uneasy combination of a ‘cargo cult’ and a ‘development association’. It remained resistant towards the Government who many thought was blocking their road to development. In 1973 Bruno Sasimua assumed the leadership and the name changed to the Tutorme Farmers Association (TFA).

By 1977 the Presidency shifted to Ferdinand Samare who held this position until 1997. In 1984 the TFA broke away from the mainland movement and changed its name to Nimamar, an acronym derived from the names of the four islands in Lihir. The name was supposed to imply unity, which was an enduring concern of the Association.
Nimamar leaders preached a form of millenarianism, or a ‘Second Coming’, combined with clear economic goals. Many followers desired a radical re-ordering of society expressed through the local concept of A Peketon, which implies that change will come to Lihir, and the belief that “Lihir will become a city”.

Not all Lihirians supported Nimamar, but people were united in their Christian faith, and more importantly in their dislike of the Government which became abundantly clear in the 1980s as Lihirians entered into negotiations with the Government and the Kennecott mining company. This antagonism towards the Government was fuelled by the belief that the forthcoming mining project was the fulfilment of Arau’s prophesies, and their concern that the Government would block the way for Lihirians to really benefit from the project.

In 1988 the New Ireland Provincial Government instituted their Community Government Act, and the Nimamar Community Government was formed, representing a real transition towards more independent local governance.

The New Ireland Provincial Government passed a bill in 1994 to transform the Nimamar Community Government into the Nimamar Development Authority (NDA), which functioned as a type of interim local level government until the Organic Law reform in 1995. In 1997 Nimamar held its first elections as the Nimamar Local Level Government.

The Lihir Gold Mine

The History

The Lihir gold mine is situated in the Kapit-Ladolam area of Aniolam Island, the largest island within the Lihir group. Unlike many other mining districts in PNG, Lihir does not have a history of alluvial gold mining.

Gold traces were initially discovered during a geological survey of PNG conducted by the Bureau of Mineral Resources between 1969 and 1974. The results fuelled great expectations for substantial gold reserves on Aniolam. The report identified hydrothermal alteration and thermal activity on Aniolam, suggesting the possibility of an environment favourable to epithermal gold mineralisation.

In 1982, prompted by these promising projections, Kennecott Explorations Australia and its joint venture partner Niugini Mining Limited employed geologists Peter Macnab and Ken Rehder to conduct sampling work on the islands which identified the potential for more extensive exploration. Rock chips taken off the sacred Ailaya rock in Luise Harbour yielded samples which averaged 1.7 grams of gold per tonne. Based on these results, Kennecott lodged an application for an Exploration Licence which was granted in 1982. Drilling commenced in the coastal area in late 1983, and continued into the adjacent Lienetz area through 1984. By the end of that year, the presence of a large gold resource had been confirmed.

Between 1985 and 1987, areas of anomalous soils in upper Ladolam Creek were sampled for gold, revealing the huge potential of the deposit. Drilling intersected gold values averaging 6 grams per tonne at intervals down to 197 metres below the surface. When the hole was deepened, a further 42 metres of gold mineralisation, averaging 3.92 grams per tonne, was intersected between 230 metres and 272 metres. This prospect was named the Minifie area and became the focus of diamond drilling throughout 1987. Further exploration defined several other adjacent and partly overlapping ore deposits, referred to as the Camp and Kapit areas. Kennecott engineers completed the first full feasibility study in 1988, but this failed to prove the economic viability of the project. In 1988, Rio Tinto Zinc (now Rio Tinto) acquired Kennecott from BP Minerals America and took over as the joint venture partner with Niugini Mining Limited.

Following the submission of a final feasibility study to the PNG Government in 1992, and extensive community consultation, including detailed social and economic impact and baseline studies, between 1986 and 1994, the Joint Venture was issued with a Special Mining Lease (SML) on 17 March 1995. The lease is valid for the term of the company’s Mining Development Contract — a period of 40 years.

In June 1995, Lihir Gold Limited (LGL) was incorporated in PNG for the purpose of acquiring formal ownership of the project from the Lihir Joint Venture. Four months later, on 9 October 1995, the initial public offering of shares was made. Lihirians secured 20 per cent of the overall 2 per cent royalty rate, and a 15 per cent equity stake through Mineral Resources Lihir Pty Ltd. Construction began in 1995, and by 1997 the processing plant at the Putput site was complete and the mine celebrated its first gold pour on 25 May 1997 at exactly 1.20 pm.

Between 1997 and 2008, the annual gold production increased from 232 697 ounces to over 700 000 ounces. The project was initially operated by the Lihir Management Company (LMC), a wholly owned subsidiary of Rio Tinto, but the management agreement was terminated in October 2005 when Rio Tinto sold their 14.46 per cent share in LGL for A$399 million, in a decision to relinquish minority positions in other listed companies. Lihir Gold Limited itself became the operator, and by 2009, LGL was operating mines in PNG, Australia and the Ivory Coast in West Africa, and was producing a total of more than one million ounces of gold each year.

The Social and Economic Impact

While the mining lease areas occupy slightly more than 12 per cent of Aniolam Island, the social and economic footprint of the operation has encompassed the entire island group and all villages have experienced substantial social, economic, cultural and political change. As with other resource development projects in Papua New Guinea, unmanaged in-migration has generated major social impacts and numerous operational risks.

Lihirians historically lived in scattered hamlets along the coastal strips. Land and other property rights are generally held by matrilineal descent groups, although this pattern is changing due to greater emphasis being placed on the nuclear family unit and fathers looking to secure land and resources for their children or pass on permanent houses to their sons. Matrilineages traditionally occupied their own hamlets, and male leaders were responsible for maintaining the men’s house of the lineage. Men’s house sites were a primary locus for the social reproduction of lineage groups through the performance of customary feasts and the exchange of pigs and shell money. Mining has introduced greater amounts of cash and commodities that are now incorporated into these events, thereby boosting the local ceremonial economy and reaffirming the symbolic importance of the men’s house.

Villages and council wards on Aniolam Island

Lihirians have strong cultural links throughout New Ireland with people from the Namatanai, Tanga and Tabar districts, and with people from West New Britain. Historical migration patterns, both within Lihir and the broader region, tended to be more short term. People travelled to other areas to engage in feasting and exchange activities and to maintain relations established through marriage and clan ties. Reciprocal notions of hospitality, coupled with comparatively less pressure upon land, meant that if people chose to stay on for extended periods of time they could be granted access to land and resources for subsistence. Some people also migrated to pursue work on plantations or in urban areas.

At the crudest level, resource development has divided Lihir into ‘affected’ and ‘non-affected’ areas. This distinction is crystallised in the 1995 ‘integrated benefits package’ (IBP) agreement and is based upon whether village land has been disturbed for mining purposes. Those Lihirians who own land within the mining lease areas receive royalties, compensation and other economic benefits. The wider community benefits in more indirect ways such as employment, service provision and community development projects. Development of the mine in the Louise Caldera required the relocation of two coastal villages, Putput and Kapit. The physical relocation of Kapit village and the subsequent resettlement programs have been complex and protracted, and are still incomplete. Due to a lack of customary land within the vicinity of the original village of Kapit, the community was divided as households were relocated around Lihir to areas where they have clan connections. Few of these relocated families have strong land tenure rights in these new locations, further compounding their vulnerability. The people of Putput were resettled as a relatively cohesive community to nearby land where they had customary land rights. Putput village is largely composed of Lihirians who claim ownership over land within the ‘special mining lease’ (SML) area and is consequently positioned at the top of the new socioeconomic hierarchy. Other nearby villages, including Zuen, Kunaie and Londolovit, also contain many Lihirians who claim ownership over land within the SML and the ‘lease for mining purposes’ (LMP) area. These villages were not relocated to make way for the mining operation, but because portions of their land were alienated for the LMP, the airport or the mining easements, these villages are also classified as affected areas and have received specific benefits and compensation.

Most Lihirians maintain high expectations for mine-derived development, and many lease-area landowners feel entitled to an exclusive claim over economic benefits and opportunities that arise from the project. At the same time, the technical or legal distinction between affected and non-affected areas fails to capture the extent to which the so-called non-affected villages have also experienced the social impacts arising from the operation. Consequently, the unequal distribution of the costs and benefits associated with the project has generated considerable tensions and divisions throughout Lihir.

More about Lihir: Luk Save Long Lihir

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