London 30/06/2016 - By Charlie Dickens
Rio Tinto has transferred its 53.8-percent shareholding in Bougainville Copper Ltd (BCL) to an independent trustee, it said in a release today.
The copper mine in Panguna, Papua New Guinea, has been out of operation since May 1989 despite it being a hugely valuable asset.
Its share in BCL has been spilt between the Autonomous Bougainville Government (ABG), and the independent State of Papa New Guinea (PNG).
ABG received 68 percent of Rio Tinto's share of BCL while PNG received the remaining 32 percent, equating to 36.4 percent and 17.4 percent of BCL's shares respectively, according to the release.
During the 17 years the mine was in operation before its closure, it produced 3 million tonnes of copper as well as 9.3 million ounces of gold.
But separatist forces, furious that the local area took a double-hit - not only was it failing to benefit from the revenue generated by the mine but it was also suffering environmental damage - sabotaged BCL amid fierce civil unrest.
The rebellion led to thousands of deaths before a ceasefire in 1998 but the mine has remained closed ever since. The civil unrest was a clear deterrent to Rio Tinto continuing its involvement in the copper mine.
But closer ties between those controlling the mine and the local population may provide a greater incentive to restart production in the mine, it is believed.
(Editing by Mark Shaw)