COMMONWEALTH OF AUSTRALIA
SPEECH
The Hon. C. E. BARNES, M. P.
ON
BOUGAINVILLE COPPER DEVELOPMENT
( Ministerial Statement)
[ From the ' Parliamentary Debates', 12 August 1969]
Mr BARNES ( McPherson-Minister for
External Territories)-by leave-Mr
Speaker, this statement is cOncerned with
the recent incidents near Kieta, Bougainville,
in the Territory of Papua and New
Guinea, in connection with the provision of
land for the Bougainville copper project.
On 31st July a lease was issued to Bougain-
Dville Copper Pty Ltd under the Territory
Mining Ordinance over 175 acres of land
at Rorovana. On 1st August, surveyors cornenced
marking the boundary of this land.
-) tview of reports that there might be
~ violence 100 police were sent to the area in
_) three groups. A group of approximately 20
women crowded around police guarding a
concrete survey peg. The police did not use
force and eventually the peg was removed
and carried away by the women. Clearing
and marking of the area continued on 2nd
and 4th August without interference. On 5th
August a bulldozer clearing scrub for the
survey team was confronted by a group of
approximately 65 men and women. There
were approximately 70 police present. The
officer in charge warned the people to disperse
on at least two occasions. He then
ordered a group of 15 police carrying
shields and batons to move in front of the
bulldozer and attempt to push the crowd
away with their shields. There was a general
melee and at this point the officer in charge
decided to attempt to disperse the crowd
with tear gas. The tear gas used is non-
20644/ 69 toxic. It was only partially effective. After
further warnings police were ordered to use
their batons about the legs of the natives
and after a very short time the crowd dispersed.
There were no injuries other than
one man who appeared to have grazed his
leg falling over a log. No-one was injured
by the police. Minimum force was used.
The members of the Papua and New
Guinea constabulary acquitted themselves
with distinction in these incidents, behaving
with the greatest restraint and discipline.
Their actions were at all times fully in
accordance with the fine traditions of this
force. These are the facts of the incidents.
I turn now to the situation behind them.
For many years there has been some
knowledge of the mineral wealth at
Bougainville Island but it was not until 1960
that an Administration geologist reported
the possibility of a major low-grade copper
deposit. Conzinc Riotinto of Australia Ltd
began prospecting the area in 1964. In 1967
after more than 12 months of negotiation an
agreement was signed between the company
and the Administration. This agreement was
tabled in the Commonwealth Parliament. It
was debated in the Territory House of
Assembly and a ratifying Ordinance was
passed by the House. The House consisted
of 54 elected and 10 official members. The
House also amended the Territory mining
legislation so as to provide that 5% of all
royalties for minerals should be paid to the
owners of the land from which the minerals
were taken. This was accepted by the
Government. in June of this year the Territory House
of Assembly ( now consisting of 84 elected
and 10 official members) debated a comprehensive
White Paper on the Bougainville
project and again endorsed it. The motion
passed by the House on -this occasion
described the project as ' a major and
essential development in the economic
future of the Territory'.
In relation to the situation at Rorovana
as well as . at Arawa, the Administrator consulted
the Administrator's Executive
Council, which has a majority of elected
members of the House of Assembly. The
Council gave unanimous support to the
Administrator's proposals for further direct
consultation with the people, to be followed
if unsuccessful by leasing under the Mining
Ordinance . or by compulsory acquisition
under the Lands Ordinance, and endorsed
the employment of police if necessary to
ensure protection of those going about their
lawful business in the area. The Council
also expressed an earnest wish that the
Rorovana and Arawa villagers would sell
their land to the Administration.
The Bougainville copper project offers
gigantic benefits to the Territory as a whole.
These benefits will include jobs for 2,500
New Guineans within the next 5 years, a
township of 10,000 people, a $ 2m training
programme for indigenous people during
the period to 1973, revenue to the Administration
of between $ 200m and $ 300m in
the first 10 years of operation, and export
income in excess of $ 100m per annum.
In addition, the Administration, on behalf
of the people of the Territory, has the
option of a 20% equity interest in the project.
CRA has indicated that it may also
provide opportunities for individual equity
participation by. the people of Bougainville.
The project therefore offers a tremendous
opportunity for the Territory to lift itself up
out of the field of competition of low priced
tropical products in international trade, and
to make a giant stride towards economic
self-reliance.
, In view of its importance to the Territory
and in view of the nature of the problems
involved, the Government and the Administration
approached this whole question with great and careful consideration of the problems
extending over many months. Advice
regarding particular aspects of the attitude
of the local people from expert anthropologists
and psychologists has been carefully
examined and the whole matter has been
the subject of the most careful study.
Certain difficulties were experienced in
1966 and 1967 in the actual area of mining
operations at Panguna, where the open pit
mine, the concentrate plant, the mine town
and a location for stacking waste rock will
be sited. The 10,000 acres of this land
covered by a special -mining lease.
The people of Guava, Moroni and
Dapera who occupy or own land in this
lease, were originally antagonistic to the
project as are the coastal people of Rorovana
and Arawa now. The problems were
handled patiently and sympathetically.
These inland people are now reconciled to
the mining operation. They are receiving
full compensation for loss of housing and
gardens and there will also be annual cash
payments for the loss of use of land and
for royalties. In summary there are about
1,000 men, women and children involved
and when ' the. mine is fully in operation
cash pavments are expected to total approximately
$ 100.000 per year. Not all the compensation
for loss of houses and gardens.
et cetera, has yet been determined by the
mining warden but some fifty people in the
villaee of Moroni have been awarded cash
and kind compensation valued at approx'
mately $ 40,000.
Oiher leases required for roads, disposal
of tailings, sources of aggregate and limestone
, et cetera may total up to 40,000
acres. Much of this area will be swamp. It
is not expected that village dwellings will
be involved.
The incidents on 1st and 5th August that
I have referred to above relate only to requirements
for the port. The company had.
however, proposed that the town be sited on
the coast in an area of some 2,000 acres
south of the site proposed for -the port.
This location would have deprived some
650 villagers of their houses, gardens and
economic crops. To avoid this the Administration
decided to locate the town at Arawa
plantation of 998 acres and to supplement
this area with some 640 acres of adjacent
sparsely planted: village land which contained
no village houses.
The arrangements for land for the port
and for the town that were decided upon
were chosen so as to cause the least disturbance
to the minimum number of native
people. The land is uninhabited. No homes
are lost. No villages are displaced. The
people have other land. Full compensation
will be paid. If need be, however, the
Administration will also make other land
available. In providing land for the port or for the
town associated with the copper project the
Administration is acting first and foremost
in the interests of the Territory. The Territory
gets more out of the copper project
than the company does. The project will
not be on full stream until about 1980.
When that happens, however, the following
points apply:
50% of the taxable income goes to
the Territory Treasury;
royalties are payable to the Territory
Treasury in accordance with the
Mining Ordinance scale;
if the Administration's option on
of the equity is taken up then
one-fifth of the dividends paid or
profits accumulated but not distributed
will accrue to the Territory.
Quite apart from these financial considerations
and the indirect tax benefits
flowing from the huge payroll that will be
financed by the project there ' are the jobs,
training' and development benefits I have
Salready referred to. The people of Bougainville
have known for years that the project
would require substantial areas of land but
until the detailed investigations were completed
it was not possible to specify the
particular areas. In March of this year the
company applied for its special mining lease.
This brought into operation ma; or aspects of
the Agreement, including the obligation by
the Administration to'pr6vide land. For over
3 years the Administration has used all possible
means' to explain to the people of
Bougainville the nature and implications of
the. mining project. The construction of
Radio Kieta was expedited in 1967 to facilitate
communications with the native
people. Since mid-1966 over forty Administration
patrols have been made in the area
affected by the mining project: A primary
objective of these patrols has been to
explain to the people the nature of the project and how it would affect them. In addition,
individual officers have spent in the
aggregate hundreds of days visiting villages
and individual families for this same purpose.
The Administrator himself visited
Bougainville earlier this year and spoke to
the people and talked over Radio Bougainville.
Last month an Assistant Administrator
led a special mission to the Island and
held meetings in the villages most affected.
This mission included indigenous ministerial
members of the House of Assembly and all
three Bougainville members of the House.
Radio and news sheets have been used
extensively and the elected members for
Bougainville have been given every opportunity
and encouragement to inform themselves
and their people of the project and
the consideration it had been given by the
House of Assembly.
As an example of the detailed and painstaking
effort on the part of the Administration
to achieve communication with the
local peoDle I refer to the fact that the
Assistant District Commissioner of the area
visited Rorovana four times in the past 4
months and the peonle of Rorovana themselves
visited the District Headquarters at
Kieta 12 times in the past 5 months for discussions.
There have' also been frequent
discussions with the Councillors of the
Rorovana Council and the Council President.
It appears that the opposition of the
Rorovana people to the sale of their land to
the Administration is not related to'lack
of information nor, indeed, to the amount
of compensation offered to them. Some 175
acres of Rorovana land is required for the
port area. The Rorovana people number
some 450 and they ' have total land of
aporoximately 1,600 acres. The loss of this
175 acres will not seriously affect their
economic livelihood. They have been offered
a good price and alternative productive
land; There has never been anry real indication
that they would sell at any price. On
the other hand, not all the native people ' are
opposed. At the village of Lonsiro only a
few miles from Rorovana, one native landholding
family concluded arrangements with
the Administration un'der which they were
paid $ 5,600 for a 42-year lease of 49 acres
of land.
The ' Administration's cositibn in relation
to negotiations for land for such public
purposes as ports,' town sites, airfields and so
on has to take account of the' need for these
public facilities throughout the Territory.
The proposed port for which the Rorovana
land is required will be for public and not
just for company use. The legal authority
for compulsory acquisition or lease of-land
exists in the Territory as in other countries
to avoid the need for excessive payments
out of the public purse, that is, to serve the
interests of the public as a whole.
Compulsory acquisition is an essential
power in all communities. It is used in Australia
more freely than in the Territory.
Individuals or small groups are not allowed
to hold the whole community up. In the
Territory as here the amount of compensation
is in the last resort subject to law.
The Agreement between the Administration
and CRA which the Commonwealth
Government is backing is modern in its
approach and enlightened in its ideas. There
will be adequate return to the Territory
Government in terms of taxes, royalties
and dividends from the profits of the operation.
There are those who would accept the
merits of the Bougainville Copper Agreement
but who would criticise the way in
which the Government or the Administration
had handled the matter. This is easilv
done. Nevertheless it ignores the tremendous
difficulties of communication and of
comprehension which have confronted the
Administration in this matter. I have explained
the painstaking nature of the Administration
communication activity. There
has been no effort spared. The basic difficulty
has been that people of this area are
living in one world and the problems of
development and the requirements of development
confront them with another
world. In the absence of skill arid patience and
moderation on the part of the Administration,
especially its field officers, we could
easily have had a much worse situation
than that which confronts us. As it is we
cannot expect easy solutions. We must
understand that what -happenedat Rorovana
and what may happen elsewhere reflect
the problems of transition into a
modern world and a modern society. These
cannot be sidestepped by an Administration
that must act in the interests of the Territory
as a whole. The Government, however,
is grateful to the officers of the Administration
for the extent to which their
efforts have so far contained the problem. The Government makes no apology for
the Agreement. It considers that the Agreement
is a spectacular contribution to harnessing
the interests of private capital and
the skills of the large corporation to the
development requirements of the Territory.
Not many developing countries are fortunate
enough to have the prospect of so
large and so remunerative a development
within their boundaries. In this, confidence
plays a major part. The investment of
$ 300m demands confidence. In this case
the investors are showing their confidence Ji
not only in the Commonwealth Government
but in . the people of the Territory
themselves because the mining project looks
ahead to the time when the people will be
running their own affairs. In this respect the
projected investment is an act of imagination
and confidence. There are many who
seek to knock it but it has the backing of
the Territory people through their House
of Assembly. It will survive.
The Government considers the Administration's
actions are fully in accordance
with the law. Action has been taken in
Papua and New Guinea to test the law. The
Government will welcome an authoritative
and definitive judicial interpretation of the
legal position.
Since 1964, the Government has made
available to the Territory by way of grant
in aid sums totalling S400m. The Government
and the House of Assembly have last
year jointly backed a 5-year $ 1,000m development
programme for the Territory.
The Bougainville project offers a unique
opportunity for the Territory to make a
dramatic advance towards these objectives
of development. The attitude of a handful
of people may attract our sympathy, and
we may go . to considerable lengths to resolve
their problems. But in the last resort
we cannot allow them to block this great
prospect and thus throw into doubt the
noli-ies on which the futures of more than
2 million people depend.
In the structure of ignorance, superstition
and prejudice, persuasion and explanations
are not easy but with other expatriate
influences working in the opposite
direction-some not without prestige in
native eyes-difficulties become great. The
present choice before the people of this
Territory is whether to drift in a primitive
and backward situation in close dependency
on the generosity of the Australian taxpayer
to provide a modicum towards health,
education and the preservation of law and
order and burdened by their ancient customs
or whether to advance as a modem
state financed substantially by its own
resources. These resources lie dormant and will continue
that way under traditional attitudes.
Developed they will provide the revenues for the hospitals, the schools, the better
standard of life and most important a
nation not only able to stand on its own
feet economically but able to opt for a
meaningful independence should this be desired.
This progressive transition has been
the way chosen by the people of the Territory;
its achievement needs sympathy and
understanding from us in Australia as well
as our continuing support.
Printed for the Government of the Commonwealth by W. G. MURRAy at tne
Government Printing Office, Canberra