𝗠𝗥𝗗𝗖 𝗖𝗹𝗮𝗿𝗶𝗳𝗶𝗲𝘀 𝗥𝗲𝗰𝗼𝗿𝗱 𝗶𝗻 𝗥𝗲𝘀𝗽𝗼𝗻𝘀𝗲 𝘁𝗼 𝗤𝘂𝗲𝘀𝘁𝗶𝗼𝗻𝘀 𝗯𝘆 𝗡𝗼𝗿𝘁𝗵 𝗙𝗹𝘆 𝗠𝗣 𝗶𝗻 𝗣𝗮𝗿𝗹𝗶𝗮𝗺𝗲𝗻𝘁

𝑭𝑶𝑹 𝑰𝑴𝑴𝑬𝑫𝑰𝑨𝑻𝑬 𝑹𝑬𝑳𝑬𝑨𝑺𝑬| 𝑴𝒐𝒏𝒅𝒂𝒚, 𝑱𝒖𝒏𝒆 9, 2025

The Mineral Resources Development Company (MRDC) issues this statement in direct response to recent Parliamentary remarks made by the Member for North Fly, concerning MRDC’s management of Western Province’s derived investments.

While robust public discourse is vital, it must be underpinned by facts and not political rhetoric. MRDC has consistently managed the Mineral Resources Ok Tedi 2 (MROT2) portfolio with strategic intent and a supportive board comprising the Chairman and Governor of Western Province, the Provincial Administrator, the three DDA reps, the Secretary for Mineral Policy & Geohazard Management, and the MRDC Managing Director.

It is important that the public, especially the people of Western Province, understand the broader picture. MRDC is not merely a custodian of resource funds – it is a long-term investment partner, mandated to create enduring revenue streams and wealth for the landowners and provincial government beyond the life of the Ok Tedi mine. MRDC is not a development agency.

𝗢𝗧𝗠𝗟 𝗗𝗶𝘃𝗶𝗱𝗲𝗻𝗱 𝗗𝗶𝘀𝘁𝗿𝗶𝗯𝘂𝘁𝗶𝗼𝗻

The restructure of the shareholding of Ok Tedi Mine resulted in the Ok Tedi landowners, the CMCA communities along the Fly River and the Fly River Provincial Government collectively owning 33% of the Ok Tedi Mine.

The Fly River Provincial Government is the sole beneficiary of the Fly River Provincial Trust which is owned by Mineral Resources Ok Tedi 2 (MROT2) and holds 12% in OTML. Since the shareholding restructure, MROT received total dividends of K339 million from 2016 to 2023.

Of this amount, the outflows were:

Investment: K122 million

Tax to IRC: K40.7 million

School Fee Subsidies: K13.5 million

Provincial Government: K81.4 million

DDAs for three districts: K122 million (North Fly DDA received K40.6 million)

𝗠𝗥𝗢𝗧𝟮 𝗜𝗻𝘃𝗲𝘀𝘁𝗺𝗲𝗻𝘁𝘀 𝘂𝗻𝗱𝗲𝗿 𝗠𝗥𝗗𝗖

MRDC’s mandate to manage the interest of MROT2 in the Ok Tedi Mine is through the Ok Tedi agreements.

The Provincial Executive Council of the Fly River Provincial Government authorised MRDC to apply 40% of the OTML dividends on investments, while 60% is distributed to the Provincial Government and the DDAs.

The K122 million investment capital (40% dividend) was used to grow the assets and generate sustainable income.

Under MRDC management, the total MROT2 investment portfolio has doubled in value over the last 7 years. This excludes the significant value of its 12% interest in the mine.

This growth was achieved by building a balanced and resilient portfolio. The investments questioned by the North Fly MP in Parliament are integral to our diversification strategy. These are not made at the expense of Western Province; they are made for Western Province. They include shares in high-performing national and international assets in key sectors of the economy:

Hospitality: Hilton Port Moresby, and Pearl Resort, Fiji

Property: Fly River Haus, Prestige Apartments, and other commercial properties

Petroleum & Energy: Dirio Gas & Power Plant, and Pasca gas project

Banking: BSP shares

Healthcare: Pacific International Hospital

Stocks: ASX and POMSOX listed stocks

Aviation: PNG Air

All investments are providing reasonable returns and long-term asset growth for the company.

Dividends from other investments are reinvested to grow the value of the assets rather than be paid out 100% as cash dividends to beneficiaries. These are prudent decisions by the MROT2 Board. No money is lost or stolen—rather, reinvested for future generations.

The North Fly DDA is represented on the board of MROT2, so one would expect that the North Fly MP would be fully briefed on the operations of the company.

𝗔𝘂𝗱𝗶𝘁𝗲𝗱 𝗔𝗰𝗰𝗼𝘂𝗻𝘁𝘀 𝗼𝗳 𝗠𝗥𝗗𝗖 𝗮𝗻𝗱 𝗠𝗥𝗢𝗧𝟮

The MRDC financials have been audited up to 2023. The audit was carried out by Ernst & Young, one of the big four audit firms, and they have given an unqualified opinion of the accounts, meaning that the accounts are fairly stated with no material errors or misstatements. The audited 2024 accounts will be presented to the Trustee-Shareholder in July 2025.

The financial accounts for MROT and the other Ok Tedi subsidiaries (MRSM and MRCMCA) have been audited up to 2023, with an unqualified opinion. The audits were done by KPMG. The 2024 audited accounts of the three companies will also be presented to their respective beneficiaries in July this year.

𝗗𝗶𝗿𝗲𝗰𝘁 𝗙𝗶𝗻𝗮𝗻𝗰𝗶𝗮𝗹 𝗗𝗶𝘀𝘁𝗿𝗶𝗯𝘂𝘁𝗶𝗼𝗻 𝘁𝗼 𝗡𝗼𝗿𝘁𝗵 𝗙𝗹𝘆 𝗗𝗶𝘀𝘁𝗿𝗶𝗰𝘁

Contrary to claims of no development support, MRDC has consistently made direct payments from the MROT2 dividends to the District Development Authorities (DDAs), including the North Fly DDA under the chairmanship of the North Fly MP.

These funds, representing a share of the annual District Authority (DA) allocation, are provided for the express purpose of funding local development projects at the district level. From 2016 to 2023, the North Fly DDA has received the following payments from MROT2:

2016: K2.16 million

2017: K2.52 million

2018: K1.44 million

2019: K5.76 million

2020: K7.92 million

2021: K6.48 million

2022: K7.92 million

2023: K6.48 million

𝐓𝐨𝐭𝐚𝐥: 𝐊𝟒𝟎.𝟔𝟖 𝐦𝐢𝐥𝐥𝐢𝐨𝐧

MRDC is responding to these baseless allegations by the North Fly MP in the parliament with facts to set records straight

These distributions demonstrate a clear and consistent record of direct financial support intended for local-level development.

Instead of deflecting, the Chairman of the North Fly DDA should account for the expenditure of these funds because the North Fly DDA has exclusive management, supervision, and control of those funds.

His constituents have the right to know where these monies have gone. He must be transparent and accountable to his people, just like MRDC is accountable to the MROT2 Board, chaired by the Western Province Governor, in the management of the MROT2 assets.