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What Mining Tenements Are There?

Six — the exploration licence, the special mining lease, the mining lease, the alluvial mining lease, the lease for mining purposes, and the mining easement. Each has its own term, area limit, and set of rights.

The mining law series, no. 8 · Mining tenements · 6 min read

Part V of the Mining Act 1992 creates six tenements. Everything else in the Act — applications, hearings, compensation, royalties — hangs off them.

The six tenements at a glance

The six mining tenements compared
TenementMaximum termMaximum areaGranted by
Exploration licence2 years, extendable in periods of up to 2 years750 sub-blocksThe Minister
Special mining lease40 years, extendableAs applied forThe Head of State, acting on advice
Mining lease20 years, extendable60 km², rectangular or polygonalThe Minister
Alluvial mining lease5 years, extendable5 ha, river bed and up to 20 m from itThe Minister
Lease for mining purposesSame as the related lease, or 20 years60 km²The Minister
Mining easementSame as the related tenementSufficient for the purposeThe Minister

Every grant is made after considering a recommendation of the Mining Advisory Council. Only the special mining lease is granted by the Head of State acting on advice — and only to the holder of an exploration licence who is also a party to a mining development contract.

Who may hold each tenement

Eligibility for each tenement
TenementWho may apply
Exploration licenceAny person — s 20(1)
Special mining leaseThe holder of an exploration licence who is a party to a mining development contract, or his assignee — s 33(1)
Mining leaseThe holder of an exploration licence over that land; the holder together with a proposed transferee; or any person over land not subject to an exploration licence, special mining lease, mining lease or alluvial mining lease — s 38(1)
Mining lease for alluvial minerals onlyA citizen; a company at least 51% beneficially owned by citizens; or an unincorporated joint venture at least 51% beneficially owned by citizens — s 38(2)
Alluvial mining leaseA natural person who is a citizen, or a land groupin respect of land owned by that person or group — s 48(1)
Lease for mining purposesAny person — s 65(1)
Mining easementAny person — s 80(1)
Two provisions reserve ground for citizens

Section 38(2) confines a mining lease for the sole purpose of mining alluvial minerals to citizens and majority citizen-owned entities.

Section 48(1) goes further: an alluvial mining lease may be granted only to a citizen or a land group, and only over land they own. It is the one tenement designed for landowners themselves.

Separately, section 9(2) lets a citizen carry out non-mechanised alluvial mining on their own land without any tenement, provided the land is not subject to a tenement other than an exploration licence.

What each tenement authorises

Rights conferred by each tenement
TenementCore rights
Exploration licence (s 23)Enter and occupy for exploration; extract and dispose of such rock, earth, soil or minerals as the approved programme permits; take and divert water; exclusive occupancy for exploration purposes
Mining lease (s 41)Enter and occupy to mine; construct a treatment plant, waste dumps and tailings dams; take and remove rock, earth, soil and minerals; take and divert water; exclusive occupancy for mining purposes; and ownership of all minerals lawfully mined
Alluvial mining lease (s 51)Mine and treat alluvial minerals only; take and remove rock, earth, soil and alluvial minerals; take and divert water; exclusive occupancy for alluvial mining; ownership of alluvial minerals lawfully mined
Lease for mining purposes (s 69)Enter, occupy and develop the land for the specified purposes; take and divert water; exclusive occupancy for those purposes
Mining easement (s 84)Construct and operate the specified facility — road, tramway or railway, aerial ropeway, power line, pipeline, conveyor, bridge or tunnel, waterway, or another approved ancillary facility
Ownership of minerals passes only on lawful mining

Section 5 vests all minerals in the State. Sections 41(2)(b) and 51(2)(b) then provide that the holder of a mining lease or alluvial mining lease owns all minerals lawfully mined from the land. Property passes at the point of lawful extraction — which is why compliance with the tenement conditions and the approved proposals matters so much.

Each of sections 41, 51 and 69 makes the rights exercisable in accordance with the Mining (Safety) Act (Chapter 195A). And rights to take and divert water must now be read with Part VII of the Environment Act 2000, which replaced the Water Resources Act.

The two support tenements

A working mine needs more than the ground it digs. Two tenements provide for that:

  • Lease for mining purposes (s 68) — for buildings and improvements, plant and machinery; a treatment plant; the deposit of tailings or waste; housing and other infrastructure; transport facilities including roads, airstrips and ports; and any other ancillary purpose the Minister approves.
  • Mining easement (s 83) — for a road, tramway or railway, aerial ropeway, power transmission line, pipeline, conveyor system, bridge or tunnel, waterway, or another approved ancillary facility.

Both are tied to the mine they serve: the term of a lease for mining purposes is identical to the term of the related special mining lease or mining lease (or 20 years if there is none), and the term of a mining easement is identical to the term of the related tenement.

What all six have in common

  1. Granted after a recommendation of the Council, following an application, objections and a Warden’s hearing.
  2. On the prescribed form, with a condition requiring compliance with the approved programme or proposals, plus any other conditions imposed.
  3. Subject to compensation to landholders under Part VII — and section 155 forbids entry until compensation is agreed or determined.
  4. Subject to rents (s 147), fees (s 146), royalties (s 148) and a security lodged within 30 days of grant (s 150).
  5. Registered in the Register of Tenements, with dealings requiring approval and registration (ss 113–120).
  6. Capable of consolidation, surrender, cancellation and expiry under Part VI Divisions 4 to 6.

Sources

Check the section yourself

Before relying on anything here, read the current text of the Mining Act 1992 and check for later amendments. If a decision matters to you, get advice — start with the Office of the Public Solicitor, or find a firm in the law firms directory.

Disclaimer: This article provides general information about Papua New Guinea law and does not constitute legal advice. Laws may change, and their application depends on individual circumstances. You should obtain professional legal advice for your specific situation. Read the full disclaimer.