ANOTHER shot has been fired in the legal battle over the Ok Tedi mine operation after papers were served on the Papua New Guinea Government in a Singapore Court.

PNG Sustainable Development Program (PNGSDP) chairman Sir Mekere Morauta confirmed the papers were served after receiving formal notification by the Singaporean Ministry of Foreign Affairs.

The court action prompted by PNGSDP comes in response to the State’s expropriation, without compensation, of the Ok Tedi mine and its attempts to take control of PNGSDP along with the US$1.4 billion long term fund.

The incident, which occurred towards the end of 2013, occurred when the PNG government passed a bill which allowed it to take 100 per cent ownership of the gold and copper mine.

PNGSDP, a Singapore incorporated company set up in 2001 to ensure the dividends of the mine were distributed throughout the community, had a 63.4% interest in Ok Tedi Mining Limited prior to the passing of the bill.

According to Sir Mekere, the Singapore Supreme Court case seeks to protect PNGSDP’s corporate integrity and to prevent the PNG Government and others from taking action in breach of Singapore laws, the company’s articles and memorandum of association, and its governing program rules.

“PNGSDP has a legal and moral obligation to protect its assets and income so that it can continue to fulfill its mandate to provide social and economic development programs in the Western Province of PNG,” Sir Mekere said.

“The company is especially mindful of the need to protect the US$1.4 billion in its Long Term Fund. The legal action we are taking will ensure that the company keeps control of the Long Term Fund so that it can be used wisely and effectively for the people of Western Province in the decades ahead.”

The case, which has been filed in the Singapore Supreme Court, gives the state until 17 February to submit a response.

PNGSDP communications director Mark Davis told PNG Resources that no response had been submitted by this deadline.

PNG Resources understands that government officials are preparing to argue the case, but no court date has yet been set.

PNGSDP has also sought international arbitration for the return of the mine or, failing that, full and fair compensation, Sir Mekere said.

The request for arbitration was recently formally accepted by the International Centre for Settlement of Investment Disputes (ICSID) in the US.

“PNGSDP believes it has a strong case and looks forward to having its property returned to it,” Sir Mekere said.

An arbitration tribunal of three eminent international jurists must be established for the arbitration to proceed, while hearings could begin in mid-2014.

Sir Mekere said PNGSDP was very keen to resume its social and economic development program in Western Province and was already thinking about what would occur when the mine was returned.

This would involve beginning talks with the Western Province community so that an agreement can be reached on the best arrangements for the future of the province.

Concurrently with the legal action, Mr Davis confirmed PNGSDP was continuing discussions with the government in hopes of resolving the matter amicably by avoiding lengthy and expensive litigation.

In light of this, the group had recently offered a compromise solution to the Prime Minister’s Eminent Persons’ Group (EPG), on a “without prejudice basis”.

Sir Mekere said the proposal offered a fair, constructive and amicable solution to the dispute.

“Following extensive discussions with the EPG, PNGSDP presented a compromise Deed of Settlement it believes is satisfactory to the company, the Government and the people of Western Province,” Sir Mekere said.

“It is aimed in particular at protecting the Long Term Fund, as well as ensuring the people of Western Province a guaranteed level of social and economic development now and in the future after the mine closes.

“I sincerely hope that PNGSDP’s compromise will meet with the approval of the Prime Minister.”

Mr Davis said PNGSDP was still waiting on a response to the compromise from the government.