Solomon Islands Gold Ridge Mine Royalty money abused: report

Honiara (Solomon Star): MILLIONS of dollars of royalty payment from the Gold Ridge operation, for landowners and Guadalcanal Province were found to be mishandled.

Individuals and groups including those in the Guadalcanal Province, landowners’ trustees, Ministry of Mines and Energy, Ministry of Finance and others were found to be connected in the dodgy payment processes.

The report identified individuals and or groups involved but could not press on to find out why they resort to devious transactions and payment procedures that are outside of the Ministry of Mines and Minerals’ regulations.

Findings and recommendations of the report were compiled by a taskforce set up to substantiate concerns and claims made by resource owners on royalty payments from the mining company.

Landowners recently met with the Prime Minister Gordon Darcy Lilo to express their concerns surrounding royalty payments.

The Prime Minister then set up a taskforce, consisted of members within NPF, CBSI, Ministry of Mines, Prime Minister’s Office and Representatives of resource owners.

Chaired by the Prime Minister’s Special Secretary Dr Phillip Tagini, it took them 10 weeks to substantiate the facts surrounding payment processes applied by individuals and groups on the royalty money.

“Individuals and or groups identified to have involved may have resorted to these unprincipled procedures due to pressure, other intentions or mere fraud, but regulations were not complied with.

“For instance, payments to Guadalcanal Province were not made through a trust account as required, but through other accounts and individuals which made it difficult to the genuineness of payments,” Dr Tagini said.

He said there were individuals identified with this processes and that some payments were made to individual accounts, but added that investigations would be a task for police investigators.

Guadalcanal Province and Resource owners normally receive 1.5 percent in royalty payments, 80 percent of which belongs to resource owners and 20 percent to the province.

The chairman of the task force yesterday handed over the report to the Prime Minister who pledged to ensure those identified will be investigated and face justice.

“Management of these funds for the benefit of resource owners is outlined clearly under the Ministry of Mines and Minerals regulations.

“It is disappointing to know that these funds which were supposed to benefit people, the province and the country have been misappropriated by a few over the years.

“We will look at the report’s recommendations and if people have to face the law, they must face it.”

The task force made the following recommendations in the report after their investigation.

“After assessing the relevant documents and relevant laws, the task force strongly recommends that the following be carried out with immediate effect:
Investigate the process comprising the individuals and government ministries that are implicated in order to find out why the established process had been abandoned   to allow cheque payments to be made directly to individuals instead of the CBSI payment.

Investigate individuals and companies to find out whether or not they obtained monies unlawfully or fraudulently from the process.

Landowners to convene meeting to agree on the payment distribution formula (revised) for the royalties of Namachamata, including new formula for Kupers and Dawson.

If however, landowners decide on a new formula, then payments will only be made after the new regulation is brought into effect.

If the landowners agree on a new formula, MOFT with MMERE to bring to Cabinet a paper outlining the agreed formula by landowners for the payment of royalties and progress to bring the regulation to effect. No royalties should be paid until that revised formula is approved by way of regulation.

Guadalcanal Provincial Government should also be advised to create the bank account prescribed under s 4 (1) of Schedule 1 of the 2011 Regulations.

MOFT must ensure that any payments made to Guadalcanal Province from GRML Royalty payments must be paid into the relevant trust account held by Guadalcanal Province as set out under the Schedule 1 of Mines and Minerals (Royalty) Regulation 2011.

The SIG Gold Ridge Expanded Task Force established by Cabinet should immediately resume its work as set out in its terms of reference.
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