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Response by Lihir Gold Ltd

Author: Newcrest Mining Limited, Published on: 11 February 2019

...As has previously been communicated to the [Londolovit Sagomana Association] LSA in correspondence from both [Lihir Gold Limited] LGL and [Conservation and Environmental Protection Agency] CEPA (as PNG's regulator responsible for the environment and water resources), the position under PNG law does not support their assertions or claims. This is because Section 79 (1) of the Environment Act 2000 expressly vests the 'the right to the use, flow and control of water" in the PNG State. Accordingly, under the laws of PNG, it is the PNG State that owns water resources (and through CEPA under the Environment Act) grants environmental permits authorising companies like LGL to extract water from rivers and other bodies of water for use in their operations. LGL is authorised to extract water under its Environmental Permit and CEPA then charges LGL a water extraction fee for this privilege. Being the property of the State, it is the State that receives the prescribed statutory payment for the use and consumption of water.

...As part of the grant and approval of the special mining lease LGL was also granted a permit to extract water...LGL is fully compliant with the requirements of its extraction permit but has on occasion extracted higher instantaneous rates of water in what can be described as extreme or anomalous circumstances. This did not however lead to exceedances of the annual permitted volumes for the 2013, 2014 and 2015 calendar years.

...[W]hile there is no legal requirement to pay royalty or compensation to landholders for the water extracted, extensive benefits are afforded to the communities on Lihir...including the community hospital operated and maintained by LGL, support for local schools, domestic waste management and road construction programs... Included here was the installation of a filtered, potable water system for the Londolovit village independent of the river system that is maintained by LGL and provides drinking and sanitation water to the Londolovit community. This water supply is based on water extracted from the Londolovit weir supplemented by groundwater and it should be noted that during the brief periods when water extraction rates were exceeded the supply of water to the Londolovit community and local households was not impacted. The focus of the claim for compensation by LSA is on potential environmental impacts on Londolovit River from changes in streamflow and is not related to access to potable or sanitary water.

...LGL, the Government and the landholders including representatives from the Londolovit area have set up a formal review process which considers tabled issues with the aim of updating and agreeing to new benefits packages. ...Included here was an extensive island wide consultation process with all groups including members of LSA. However, although LGL and the Government has invited the LSA to participate in the review process, the LSA is presently declining to formally participate and is currently acting outside of a charter agreed to by all other landholder groups on Lihir and relevant PNG Government agencies.

We continue to encourage the LSA to engage with the rest of the Londolovit community through the ongoing LAR process as this is the best way to have their issues heard and addressed.

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This is a response from the following companies: Lihir Gold Ltd (a subsidiary of Newcrest) Newcrest