PNG Allows Ramu Nickel Project to Recommence

SYDNEY, Aug. 19 -- Construction of Papua New Guinea's Ramu nickel mine and processing plant has been allowed to restart after being halted for a month due to health and safety concerns, PNG's chief mines inspector said on Wednesday.

    Work on the project, majority owned by Chinese state-owned China Metallurgical Construction Group Corp, was disrupted in June by fighting between workers after an industrial action. PNG ordered a halt to operations at Ramu on July 21 and all staff withdrawn from the site on health and safety grounds.

    PNG chief mines inspector Mohan Singh said permission to recommence construction at Ramu had been granted on condition that ongoing safety conditions are met.

    "This permission was granted on 15th of August and management has confirmed that they recommenced their operations on 16th of August," Singh told Reuters on Wednesday by telephone from the Papua New Guinea capital Port Moresby.

    "We have allowed this permission subject to some statutory conditions imposed for management to comply with. The order has not been vacated in total it has been relaxed to recommence operations subject to some conditions imposed," he said.

    Sign said the "non critical" conditions remaining must be met on a daily basis, but should not affect the project's timetable.

    "We can not disclose the conditions because of the mining safety act," Singh said. "We do not think it should affect the timeframe for the project because they are very basic safety requirements that any project is supposed to comply with."

    The Ramu project, estimated to cost $1.7 billion, is scheduled to start production in late 2009 and is designed to supply stainless steel mills in China.

    Australia-listed Highlands Pacific Ltd (HIG.AX: Quote), which owns 8.56 percent of the project, has said the month stoppage over health and safety would not affect construction time.

    (Source: Reuters)