The country is a significant producer of gold, copper, nickel, silver, cobalt, oil and gas. In 2013, Papua New Guinea was the world’s 12th largest producer of gold, with Lihir, Ok Tedi and Porgera the largest industrial gold mines. Small-scale mining of gold employs 60,000 to 80,000 people. Crude oil production is modest by global standards and declining due to maturing oil fields. Oil is slowly being replaced by natural gas production. Liquefied natural gas (LNG) production started in 2014, as the PNG LNG project came on-line. Social conflicts have centred on environmental impacts of mining, state participation in the extractive industries and inter-ethnic tensions. Another major issue that the EITI in PNG seeks to address is the lack of clarity in the process of paying landowners their shares from extractive operations.
Perception of corruption and fiscal instability also beset the country. PNG continues to suffer from fiscal woes brought about by lower revenue receipts caused by the slump in oil prices. In the last quarter of 2016, the government amended its year-end GDP growth projection to 2% as a result of low revenues from the mining sector.
The EITI is improving inter-ministerial policy coordination, serving as a platform for discussions between industry and government as well as building trust with civil society.