News and Public Notices

Following the call by the former Speaker of the Bougainville House of Representatives Mr. Andrew Miriki, and few unscrupulous comments on social media I wish to address the critical discussion of the ABG towards the appointment of Mr Nanei as a Director on the Bougainville Copper Limited (BCL) company Board.

The suggestions being made on social media that the appointment is improper are unfounded and misleading.

There have been suggestions that there is a conflict of interest in having Mr Nanei as the Principal Legal Adviser (PLA) appointed to the Board.

There has been no clear articulation though of what that conflict may be. We can though assume that such a suggestion relates to BCL’s potential role in re-opening Panguna mine. I want to specifically address these separate issues here. The background to this matter is that Rio Tinto transferred its portion of shares held in BCL to the ABG in 2016.

In accepting these shares, the ABG established Bougainville Mineral Limited, a company which these shares were parked under.

The ABG then appointed Mr. Steven Burain, former Secretary of ABG Mining Department and Mr. Nanei as Directors of Bougainville Mineral Limited.

The transfer was made by way of giving ownership of those shares to Bougainville Minerals Limited, which is the ABG-owned mining investment company.

This brought the ABG’s shareholding in BCL to approximately 36% of the total shares held in the company. The ABG holds the share certificate for this portion of shares, which it was issued in 2016 at the time of transfer. Documents pertaining to the Share certificate including other documents reflecting ABG’s ownership of over 36% shares in BCL through Bougainville Mineral Limited are with IPA to assist them to make the necessary updates to ensure that the transfer is reflected publicly on their searchable website.

There are several issues being confused in the criticisms being levelled about Mr Nanei’s appointment. They need to be dealt with separately in order to arrive at correct conclusions.

1.       ABG is the major shareholder in BCL: The ABG’s current shares in BCL as a company, makes it a significant shareholder with more than one-third of total holdings. The National Government has also undertaken as most recently as December 2021 to divest its remaining shares to the ABG. This will increase the ABG’s total shareholding in BCL to around 76%, making it the majority shareholder. Such a significant shareholding has led BCL to invite representation of the ABG on its Board. This is standard corporate practice where a party holds such a large stake –they are allowed to participate in the decisions made by the company by voting as a Board member. The Autonomous Government was given the opportunity to appoint two members on the Board of Directors of the company. The ABG’s nominees were Mr Kearnneth Nanei and Mr James Rutana, which were accepted by BCL.  

2.       Mr Nanei appointed as Principal Legal Adviser: Mr Kearnneth Nanei was appointed in his statutory capacity as Principal Legal Adviser to the ABG. As Secretary to Department of Law & Justice he is also holds the office of PLA. There was no oversight, and there is certainly no conflict of interest, in his appointment. He was deliberately chosen for the role because of his position as PLA. Mr Nanei, as the holder of legal qualifications and years of high-level experience is able to bring weighty technical legal expertise to the seat. His role as ABG’s legal adviser also provides him with significant strategic insight into the Governments desires. It is of great advantage to ABG to have someone with his legal skill as well as inside knowledge of the ABG’s future plans sit on the Board of a company they now own a majority share of. Mr Nanei will learn valuable inside information by sitting on the Board, about the future plans of BCL. This information he will, as PLA, report back to ABG. Mr Nanei’s integral role in all high-level ABG plans means he will synthesise the information he hears from BCL Board meetings, with respect to the ABG’s plans, far better than another ordinary lawyer.  

3.       BCL role in Panguna: Nobody knows what role BCL will play, if any, in the reopening of Panguna mine. Even our current Toroama-Nisira Government has not made any decision yet; accept to continue consulting with the Panguna Mine landowners in deciding the future of the mine. It is though not relevant to the appointment of ABG representation to the BCL Board. These are two separate issues. Mr Nanei sits in the seat because of ABG’s substantial shareholding, not because the ABG has any preconceived notions of BCL’s future role in Bougainville mining. Mr Nanei’s seat on the Board is entirely independent of BCL’s role in the re-opening of Panguna mine.

My statements today must quiet the criticisms being laid against our Government, and Mr Nanei. They are unfounded and particularly unfair to Mr Nanei’s honourable reputation.

The appointment made is proper in every legal and good governance sense, and I am confident that my Secretary Mr Nanei will uphold the oath of office well.    

 

Honourable Minister Ezekiel Masatt

Attorney General & Minister for Justice & Bougainville Independence Mission Implementation

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