21 missing. Those figures compared reasonably well with the enemy casualty list of 120
certainly killed, 30 probably killed and, at the lowest estimate, 50 seriously wounded. But, of course, the missing Fijians turned up. They knew no more about the trail than the
Japanese did, but they had no difficulty in finding it. One section caught up with the main column at 5:45 p.m. on the 16th. The other two made rather worse time, but may perhaps be
excused, as they had a certain amount of fighting to do on the way. They marched into the battalion bivouac area at 7 p.m. on the 17th.
The trail led through precipitous country; but, guided by Sergeant Usaia, the Fijians moved along at a good pace and by 7 a.m. on the 19
th
, they reached the coast. Four hours later they embarked in a little fleet of Higgins boats and at 12:15 p.m., they were back inside
the Allied perimeter. There was one pleasant sequel. On the 20
th
, Colonel Upton was summoned to Corps Headquarters to give an account of the action to an audience of senior American officers. He
began with the apologetic statement, “I don’t expect you to believe this, but it happens to be true.” When his talk was over the Allied Commander, General Griswold, got to his feet and
said, “Gentlemen, you have been listening to a description of an action which I think will go into the records as a minor tactical classic” Central Office 1946:65–75.
1.2.2 Influence of copper mining on Bougainville-Buka
Miners first came to Bougainville searching for gold in the wake of the New Guinea gold rush after the First World War. Prospectors Jack Comb and Bob Palmer discovered gold
in the dense rain forest of the Crown Prince Range at Kupei. A small mine was established there as well as others nearby at Moroni and Panguna and along the Kawerong River. But the
gold was difficult to win from the copper ore and mining tapered off in the early 1950’s Bougainville Copper Ltd. 1981:4.
…post-war mineral discoveries in Australia stimulated exploration for minerals in the nearby islands, and when new technologies demonstrated the profitability of mining low-
grade copper ores, provided these occurred in sufficiently large quantities, two companies formed a joint enterprise in 1964 to test the feasibility of mining the Bougainville deposits.
These were Conzinc Riotinto of Australia Ltd CRA and New Broken Hill Consolidated Ltd, the former contributing two-thirds of the venture capital, the latter one-third Oliver
1973:157.
The CRA geologist, Ken Phillips, who was in charge of the exploration team working in Papua New Guinea, walked into Panguna Valley on 1st April, 1964. Light drills were
manhandled across the 1,100 metres high divide by the exploration crew in November 1964 to do the initial drilling. In mid-1965 heavier drills were flown in by helicopter Bougainville
Copper Ltd. 1981:4.
While testing was underway, a mining agreement was negotiated with the administration. According to its terms, if and when the company decided to go ahead with
actual mining the administration would be offered 20 per cent of the enterprise’s equity capital—an option which the administration subsequently exercised by acquiring 20 per cent
of the shares issued by the company—plus a royalty at the rate of 1.25 per cent on the free on board value of its revenues from sales of copper concentrates during the 42-year term of the
initial mining lease. In addition, after three years of commercial operation the company was obliged to pay territorial taxes on its profits beginning at the rate of about 25 per cent per
annum and increasing over the years to a maximum rate of 66 per cent Oliver 1973:157.
Initial samples were promising, but it took five years of drilling, tunneling and metallurgical test work to define the ore body and establish engineering feasibility. As the
deposit was low grade, very large ore reserves were needed to feed a plant which would give the required economies of scale…
22 Economic feasibility of the Bougainville operation was established in July 1969 and was
finalised in October of the same year when financing arrangements involving the raising of some K130 million in equity capital and K260 million in loan capital, were completed
Bougainville Copper Ltd. 1981:4. Astounding rates of change as a consequence of the mining operations are clearly visible
at the Sub-district level. By way of example: the number of persons licensed at Kieta to drive a motor vehicle increased from 45 in 1966 to 3953 in 1970; cargo tonnages at the port of
Kieta increased from 35,000 in 1968 to 460,000 in 1971; and the urban population increased from around 750 in 1966 to over 14,000 in 1971—the peak of the construction phase. Most
of the new inhabitants were ‘outsiders’ drawn to the mining complex and housed in the two new towns of Panguna and Arawa, and surrounding areas on a temporary basis Mamak et al.
1974:3.
Ore truck and shovel in the pit
The decision to go ahead with mining was made in 1969, after an expenditure of over A21 million in testing. By this time the ore body had been found to contain over 1000
million tonnes of variable quality; for economic reasons it was decided to mine only those locations containing about 900 million tonnes which had an average content of 0.48 per cent
of copper and 4389 milligrams of gold per tonne. The open-pit mine will eventually become one of the largest man-made holes in the world; 2 kilometers wide, 2.4 kilometers long, and a
minimum of 300 meters deep. Mountainous terrain along one side of the pit will produce benched terraces reaching in places as much as 800 meters in height. To reach the mineral-
bearing ore, it will be necessary to remove, initially by hydraulic lifting and by truck haulage, about 42 million tonnes of waste overburden. The ore itself will initially be processed at the
mine site by crushing and concentration, and then moved by pipe line, in the form of a slurry, to Loloho, the company’s port some 26 kilometers away. When in full operation the
concentrators throughput will reach 90,000 short tons of ore a day Oliver 1973:158.
Milling and flotation require a water supply of around 200,000 cubic meters per day. This is the equivalent to more than two tonnes of water per second. Securing of this water
supply has involved construction of pump stations on the Jaba and Kawerong rivers Bougainville Copper 1981:15.
In 1981, the Company [Bougainville Copper Limited formed to operate the mine] mined 77.6 million tonnes of material. Of this, 37.5 million tonnes of ore were treated to produce
23 576,000 tonnes of concentrate. This concentrate contained 165,000 tonnes of copper, 16.8
tonnes of gold and 42.4 tonnes of silver and had a gross value of K360 million of which copper contributed 54 and gold 44.
The mine commenced production in April, 1972, and thus this Annual Report [1981] marks the end of a decade of operations. Throughout this period the Company’s development
and performances have been closely linked with those of Papua New Guinea. In particular the mine’s impact upon the country’s economy has been considerable.
Since startup total production from the mine has been 1.7 million tonnes of copper, 188 tonnes of gold and 433 tonnes of silver. This production has a value of K2.4 billion which
represents 48 of the country’s exports. Over the same period payments to the Government in the form of dividends, taxes, etc. amounted to K540 million which represents 22 of the
Government’s internally generated revenue. Further, the presence of the Company on Bougainville Island has encouraged the development of local business enterprises providing
goods and services required for the mine’s operations and for the island’s residents.
Bougainville Copper is the country’s largest industrial employer with a workforce of over 4000; of these 80 are Papua New Guinea nationals. In the ten years to 1981, a total of
600 Papua New Guinea citizens have completed their apprenticeships with the Company and an even greater number have attended other training and development courses. The
Company’s training programme has resulted in considerable progress in the localisation of the Company’s employees and has made a sizeable contribution of skilled workers to the
Papua New Guinea workforce.
Exploration and development of Panguna prospect was undertaken by CRA Limited which now holds 53.6 of the share capital of Bougainville Copper Limited. The Papua
New Guinea Government and its nominee The Investment Corporation of Papua New Guinea own 20.2 while the remaining 26.2 is in the hands of public shareholders
Bougainville Copper Ltd. 1981:1.
Less tangible, but in the long run, of perhaps equal importance to the Territory’s [PNG] economy, will be the opportunities which the project will provide to numerous indigenes to
acquire new skills; company policy from the beginning has been to give preference in employment to PNG’s indigenes in both technical and staff positions. This policy has been
reinforced by means of large-scale on-the-job training, by liberal donations of tertiary school scholarships with no requirement for eventual company employment, and by deliberately
rapid replacement of expatriate employees.
At the peak of the construction period, there were some 10,189 employees on the payrolls of the copper company and its associated contractors—3861 expatriates and 6328
indigenes [many of these being young men from the Rotokas area]. It is expected that this number will drop to about 3000–3500 in normal post-construction times, and that the
replacement of expatriates by indigenes will proceed at the following rate:
Percentage of indigenes by job category
1972 1975 1980 Managerial and professional
1 7
30 Sub-professional 4
25 70
Supervisory and skilled 36
75 95
Semi-skilled 95 100
100 Unskilled
100 100 100 ___ ___ ___
Total 70 87 94
Internally as well, the company has sought to narrow the economic gap between indigenous and expatriate employees by paying the former with the highest wages deemed
practicable; but wages present a different kind of problem, with political overtones. For even if the company would like and were able to pay indigenous and expatriate employees the
same rates for the same jobs—and there is no evidence that this is not the case—it is
24 constrained from doing so by its view of the economic realities of Papua New Guinea as a
whole and its wider responsibilities as a leading employer there… The company’s official social policies have been suffused with the same principles of
ethnic equality—or indeed, pro-indigenous bias—as exemplified in its effort to promote ‘integrated’ messing, housing, and recreation, and in its stern sanctions i.e., immediate
dismissal against inter-ethnic brawling. …Unfortunately from the company’s standpoint, and despite its relatively enlightened
policies, several factors have intervened during its first few years of operations to create dissatisfaction and even hostility among some of its indigenous neighbours. Some of this ill-
will was brought on by ignorance on the part of company personnel or ineptness on the part of administration officials during the early stages of exploration and land resumption. Some
has been aroused by changes made from time to time in company plans and operations when at several stages in the exploration and testing the scope of the project has had to be
expanded. Still other frictions have been engendered by the mine’s mode of financing, by management’s need to commence revenue-earning production as rapidly as possible in order
to retire heavy-interest loans. And still others stem, probably inevitably, from the very nature of the enterprise and of its geographic and cultural setting: a privately owned and managed
profit-seeking business with large manpower and land requirements situated among a remote, and commercially underdeveloped and, by European standards, culturally archaic populace
Oliver 1973:159–160.
1.2.3 Influences behind and within the nationalism movement in the North Solomons Province
