Can investors take Bougainville Copper Limited seriously?
There is a saying investors in Bougainville Copper Limited should heed, ‘fool me once, shame on you; fool me twice, shame on me’.
Unfortunately whoever penned this phrase, never thought of what to say when it gets to fool me three times!
Over the past three years, BCL has assured investors that landowner hearts in Panguna are gradually warming to the company, despite BCL’s well documented role in assisting a war machine that bombed, executed and tortured civilians.
According to BCL, this cooling of tensions in Panguna lays the ground for Bel Kol, a reconciliation ceremony that will evidently mend bridges between the company and landowners.
Here is what BCL told investors in its 2013 Annual Report:
‘This historic and sensitive [Bel Kol] ceremony, long discussed and unfortunately somewhat delayed by various factors, aims at bringing reconciliation between Bougainville Copper, landowners, ABG, ex-combatants and community leaders. Bel Kol is proposed to be held at Arawa, and may be conducted during the month of May [2014]’.
BCL’s motive for participating in the ceremony is set out with disarming frankness:
‘After the Bel Kol ceremonies, in which company management will participate, three conflict memorials will be erected. In return, Bougainville Copper has asked for open access to Panguna and the Special Mining Leases, assurances of safety, and a written invitation to establish an office in Arawa as a base for the field work, baseline studies and social mapping mentioned above, and for the recruitment of local people to participate in drilling and other evaluation and de-risking programs’.
So did Bel Kol take place in May 2014 as predicted? Nope!
Fast forward to the 2014 Annual Report. In this yearly update BCL suggests Bel Kol will take place some time in 2015:
‘A Bel Kol ceremony with the company is at the advanced stages of planning and is expected to take place in Arawa during 2015’.
Did Bel Kol take place in 2015? Nope!
Fast forward to BCL’s 2015 Annual Report [pdf file]. Have a guess what they tell investors!
Cue the drumroll. Here it is:
‘Planning of a Bel Kol event, a customary Bougainvillean process to be held between the company and the people of Bougainville, was further postponed to allow additional time for stakeholder engagement and alignment. Bel Kol is now planned to be held in 2016’.
None of these delays are surprising, landowners have frequently, loudly expressed their strong opposition to BCL’s return – over and over again. Having your home torched and family beaten by troops in BCL trucks, lingers long in people’s memory.
Yet, BCL seems confident its investors lack the same recall.
Although investors may be seeing little joy, despite the assurances of management, BCL’s illustrious Directors are doing rather well for themselves. The former PM who bombarded civilian areas in Bougainville with heavily armed troops and mobile squads, Sir Rabbie Namaliu, was awarded K150,000 in compensation as Director for the year 2014, and in 2015 he received K135,000. Dame Carol Kidu was awarded K150,000 in 2014, and K135,000 in 2015. Robert S. Burns was awarded K150,000 in 2014 and K135,000 in 2015. Last but certainly not least, Peter R. Taylor received K478,000 in 2014, and K501,000 in 2015.
We are also told, ‘in 2015 the company paid fees of K4,196,032 (2014: K5,048,151) for the provision of office space, staff and related services to Rio Tinto PNG Limited’.
While BCL management pronouncements on Bel Kol have assumed a mirage like quality, it appears executive payments are being deposited each year with much greater reliability.
RTG Price at posting:
11.0¢ Sentiment: Buy Disclosure: Not Held
