Full Terms of Reference for the ESAP - Morobe Mining Joint Venture

1. INTRODUCTION
2. NAME
HIDDEN VALLEY MINE EXTERNAL STAKEHOLDER ADVISORY PANEL
TERMS OF REFERENCE AND PROCEDURES
The Hidden Valley Joint Venture (hereinafter referred to as HVJV) was established in August 2008 as a
joint venture between Morobe Consolidated Goldfields Limited and Newcrest PNG 1 Limited. The
objective of the joint venture is to mine and process gold and silver at the Hidden Valley mine and
surrounds in Morobe Province, Papua New Guinea.
The Hidden Valley mine is operated by Hidden Valley Services Limited (hereinafter referred to as
HVSL), which is jointly owned by Morobe Consolidated Goldfields Limited and Newcrest PNG 1
Limited.
HVJV proposes to establish an external stakeholder panel to enable environmental and related social
issues important to the community to be promptly identified and addressed in a transparent and
responsible manner.
The name of the panel is the Hidden Valley Mine External Stakeholder Advisory Panel (hereinafter
referred to as ESAP).
3. OBJECTS AND MANDATE
3.1 Objects
The ESAP is to be an advisory body to assist HVJV in addressing the environmental and related social
impacts of its activities upon the community.
The objects of the ESAP are to:
(a)
(b)
(c)
(d)
assist HVJV to formulate and implement appropriate environmental policies and strategies;
assist HVJV to assess the environmental and related social impacts of its activities by
recommending the conduct of specific approved technical studies and investigations;
review the results and findings of approved technical studies, data and investigations and
advise and make recommendations to HVJV thereon; and
be a credible, independent, expert source of information and data relevant to the environmental
and related social impacts of HVJV’s activities.
For the avoidance of doubt, ESAP will not undertake:
• an operational role. The ESAP is not to usurp or replicate the functions of HVJV or HVSL staff,
contractors and consultants in the formulation of operational work plans;
• a prescriptive role, being a consultative source of non-binding, independent advice and
recommendation only; nor

• a mediating, arbitrating or dispute resolving role. Dialogue between HVJV and affected
stakeholders on any issue will be undertaken directly through the established liaison channels
and procedures of HVJV.
3.2 Mandate
The mandate of the ESAP is as follows:
(a)
(b)
(c)
(d)
(e)
(f)
at the request of HVJV, to periodically review HVJV’s environmental standards, policies, data
and procedures and to give advice and make recommendations thereon, having regard to
local, national and international norms and standards;
to identify actual or potential environmental and related social impacts of HVJV’s activities,
having regard to topical stakeholder concerns and inputs;
to recommend to HVJV the commissioning of relevant, specific technical studies and
investigations, for HVJV approval. Studies and investigations approved by HVJV will be
conducted by HVJV or by external experts or institutions on HVJV’s behalf at HVJV’s cost and
expense;
to review the results and findings of approved studies and investigations and to give advice and
make recommendations to HVJV thereon;
to be a credible additional source of information relevant to the environmental and related
social impacts of HVJV’s activities; and
to assist HVJV to communicate relevant information to stakeholders by means of joint
announcements and joint attendance with HVJV representatives at community or stakeholder
forums.
4. MEMBERSHIP
4.1 Appointment of Members
The ESAP will initially comprise a minimum of 3 (three) and a maximum of 6 (six) members, being
persons external to HVJV. HVJV has the discretion to change the number of members as and when it
considers appropriate
Members will be appointed by HVJV in consultation with the Chairman and other interested parties.
4.2 Qualification and Experiences
To be eligible for appointment, members must be persons with impeccable integrity, high inter-personal
skills and sound and balanced judgment. Factors to be considered in the selection of members will
include:
(a)
knowledge, expertise and experience with regard to environmental and/or social aspects of
resource development;

(b)
(c)
(d)
understanding of and/or experience with Papua New Guinea mining laws and regulations, and
national and international standards applicable to the conduct of resource projects;
familiarity with the geographical regions in which HVJV operates; and
an established record of participative dealing with communities and NGO’s through negotiation
and consultation.
4.3 Term
Technical expertise is not a requirement for all members. However, technical members should be
distinguished academics, representatives from industry, senior consultants or researchers with
extensive experience of mining-related environmental issues. Academics or researchers should
possess a track record of relevant research and publications. Consultants or industry participants
should demonstrate corresponding eminence in their particular field.
Persons holding or seeking political office and representatives or employees of the HVJV, HVSL or the
joint venturers are not eligible for appointment as members.
A panel member will be appointed for an initial term of up to 2 (two) years and will be eligible for reappointment
at the end of each term.
4.4 Termination
A member may resign from the ESAP at any time after having given at least 21 days’ notice in writing
to the secretary.
The appointment of each member will terminate at the end of each term of appointment. However, the
appointment of a member may be immediately terminated by HVJV if, in the reasonable opinion of
HVJV, the member:
(a)
(b)
(c)
(d)
(e)
fails to act in a manner consistent with the objects and mandate of the ESAP;
fails to comply with the provisions of these Terms of Reference, and in particular the provisions
of clause 7.3 and clause 9;
fails to disclose a significant conflict of interest;
engages in conduct which hinders the effective operation of the ESAP; or
fails to attend 2 (two) successive meetings of the ESAP without reasonable cause.
HVJV will consult with the Chairman before moving to terminate the appointment of a member.
4.5 Compensation
All reasonable costs and expenses directly incurred by a member in the performance of the member’s
functions and duties will be reimbursed by HVJV. These costs and expenses will include all costs of
travel, accommodation and meals incurred for the purpose of attending meetings.

HVJV will also compensate each member for such member’s services in such rate or amount as HVJV
and the member may agree, having regard to such member's qualifications, experience and time
commitment to the ESAP.
All payments made by HVJV to members will be disclosed in HVJV’s financial statements and other
publications.
5. PARTICULAR ROLES AND FUNCTIONS WITHIN THE ESAP
5.1 Chairman
HVJV will appoint one member to be the Chairman of the ESAP. The appointment will be made after
consultation between HVJV and relevant organisations, individuals and stakeholders.
The Chairman will initially work with HVJV with regard to the selection and recruitment of the other
members.
The primary function of the Chairman is to facilitate open and constructive dialogue within the ESAP
and between the ESAP and HVJV. The duties of the Chairman include:
(a)
(b)
(c)
(d)
(e)
(f)
(g)
(h)
(i)
(j)
approving the times and venues of ESAP meetings;
ensuring timely issuance of notices of ESAP meetings and agendas;
chairing all ESAP meetings, provided that, in the event of the Chairman’s absence from a
meeting, a member elected by the other members present at the meeting will chair the
meeting;
ensuring all members have the opportunity to participate in the meeting;
ensuring timely issuance of ESAP minutes;
reviewing and signing minutes;
seeking comments on the previous minutes at the commencement of the subsequent meeting;
ensuring that HVJV is promptly made aware of any significant concerns or issues raised by
the ESAP;
coordinating the preparation of ESAP reports to HVJV and sign such reports; and
ensuring timely delivery of ESAP reports to HVJV.
5.2 Secretary
HVJV will appoint a person to be the secretary of the ESAP. The secretary will be responsible for the
administrative and secretarial work arising from the functioning of the ESAP. The secretary will not be a
member, but will attend all ESAP meetings.

The salary of the secretary will be borne by HVJV.
The duties of the secretary will be determined in consultation with the Chairman, but will include:
(a)
(b)
(c)
(d)
(e)
(f)
(g)
preparing notices of ESAP meetings, meeting agendas and briefing notes;
issuing notices of ESAP meetings (together with supporting documentation);
attending all meetings of the ESAP and record the minutes of the proceedings thereof;
circulating minutes of meetings for review and approval;
distributing signed minutes to members and the HVJV;
assisting in the preparation of ESAP reports;
causing ESAP reports to be delivered to HVJV; and
(h) having custody of all books, documents, minutes, records and registers of the ESAP and to
retain them in safe custody for a period of at least seven years from the date of creation
thereof.
5.3 HVJV Representatives
It is intended that the ESAP will be an independent, third party advisor to HVJV.
Accordingly, HVJV representatives and/or employees of HVJV or the joint venturers will not be
appointed as members.
However, the Chairman may request HVJV to cause its representative(s) or senior management
employees to attend ESAP meetings when required.
6. GOVERNANCE
6.1 Meetings
The ESAP must meet for the dispatch of business at least twice per calendar year. No more than four
meetings of the ESAP will be conducted within each calendar year without the prior approval of HVJV.
All meetings of the ESAP will be held in Papua New Guinea. The location of the meetings will be
determined by the Secretary in consultation with the Chairman, taking into account the business to be
conducted and the convenience of the members.
The timing and frequency of meetings of the ESAP will be determined by the Chairman in liaison with
HVJV and the members, depending upon the issues to be addressed.
A meeting of the ESAP must be called by the Chairman as soon as practicable after receiving a written
request stating the purpose of the meeting:
(a)
from HVJV; or

(b)
from not fewer than 2 (two) members.
Meetings will be convened by the secretary by notice in writing given to members at least 21 days in
advance of the scheduled meeting. The notice must state the date, time and venue of the meeting and
the business to be transacted, and must be accompanied by all applicable agendas and briefing notes
together with the minutes of the previous meeting.
The Chairman may authorise shorter notice if circumstances necessitate same.
6.2 Quorum
At least half of the total number of members (including the Chairman) form a quorum and must be
present before a meeting may begin or continue.
If, at the time fixed for a meeting to begin or continue, and for 30 minutes after that time, there is no
quorum present, the meeting must be adjourned to the same place at the same time on the
corresponding day in the following week unless that day is a public holiday, in which case the meeting
must be adjourned to the day immediately after that public holiday.
A meeting that has been adjourned may proceed on the date to which it was adjourned with the
members present at the time called for the meeting, regardless of whether or not notice has been given
and whether or not a quorum is present.
6.3 Rules of Procedure
The ESAP may adopt such general rules of procedure for its meetings as the Chairman considers fit.
However, in the event of any conflict between those rules and rules of procedures herein (the Rules)
will prevail.
Members will participate in the ESAP in their personal capacity and on the basis of their individual
expertise. The Chairman may invoke the Chatham House Rule at any meeting and this fact will be
recorded by the Secretary in the minutes.
Each member will have a deliberative vote. All questions arising shall be decided by a majority of votes.
If there is an equality of votes, the Chairman shall have a casting vote in addition to his or her
deliberative vote.
However, since the ESAP acts in an advisory capacity only, there is no requirement for the ESAP to
reach a majority or consensus position in relation to any particular matter, provided that where there is
a significant divergence of opinion amongst members in relation to a matter, this will be recorded by the
secretary in the minutes and in any related report to HVJV.
6.4 Minutes
Minutes must be produced within five working days of each ESAP meeting and circulated to all
members promptly after approval thereof by the Chairman.
The secretary shall:

(a)
(b)
ensure that the minutes taken at a meeting are checked and signed as correct by the
Chairman; and
distribute the signed minutes to all members and to HVJV, accompanied by copies of all
pertinent information presented at the meeting.
7. OUTPUT
7.1 General
It is intended that the ESAP will provide HVJV with non-binding, independent:
(a)
(b)
(c)
(d)
advice and recommendations with regard to the formulation and content of relevant HVJV
standards, policies and procedures;
information with regard to the topical issues and concerns of affected stakeholders;
recommendations with regard to technical studies and investigations to be undertaken by
HVJV, for HVJV approval. Recommendations are to be in order of priority; and
advice and recommendations with regard to the results and findings of HVJV-approved
technical studies and investigations.
7.2 ESAP Reports
The output of the ESAP will generally take the form of written reports delivered to HVJV.
As soon as practicable after the preparation and presentation of an ESAP report to HVJV:
(a)
(b)
(c)
the Chairman will meet with the GM: Operations and the GM: Sustainable Development &
External Affairs of HVJV, together with such other HVJV management and members as they
may agree, in order to discuss the contents of the ESAP report;
HVJV will prepare and deliver to the Chairman a written response to the ESAP report. For the
avoidance of uncertainty, HVJV is not obliged to accept or give effect to any advice or
recommendation contained in the ESAP report;
the Chairman will meet with the GM: Operations and the GM: Sustainable Development &
External Affairs of HVJV, together with such other HVJV management and members as they
may agree, in order to discuss the contents of HVJV’s written response.
In addition to the above, ad hoc meetings between the Chairman, the GM: Operations and the GM:
Sustainable Development & External Affairs of HVJV, together with such other HVJV management and
members as they may agree, may take place by agreement at any time.
7.3 Public Announcements and Presentations
It is intended that stakeholders will be informed of:
(a)
the advice and recommendations provided by the ESAP in its reports to HVJV; and

(b)
the response of HVJV thereto, including any actions to be taken by HVJV,
in a manner which appropriately takes into account the commercial sensitivity of such information and
the right of affected stakeholders to be informed. This may include the dissemination in agreed format
of relevant agreed and approved documents and information, subject to any statutory or contractual
constraints, including confidentiality, attaching thereto
HVJV and the Chairman will prepare joint announcements regarding matters within the mandate or
ESAP as and when appropriate. No public announcements will be made by ESAP or any member
except by prior agreement between HVJV and the Chairman with regard to the form and content
thereof.
In addition to joint announcements, the Chairman and members may be requested by HVJV to
participate with representatives of HVJV in public forums and presentations to affected stakeholders.
8. LIABILITY AND RESPONSIBILITY
8.1 Liability of Members
The ESAP acts in an advisory capacity only. The advice and recommendations of ESAP are not
binding on HVJV.
Accordingly and notwithstanding any advice or recommendation given by the ESAP:
(a)
(b)
(c)
all responsibility for the actions and decisions taken by HVJV rests and remains with HVJV and
not the members, whether jointly or severally;
HVJV will not hold any member or the secretary liable for any loss or damage that may arise as
a result of HVJV acting on the advice or recommendations of the ESAP; and
HVJV will indemnify each member and the secretary of ESAP against any liability to third
parties arising from or incurred by reason of the bona fide activities of such member or
secretary in discharge of their responsibilities pursuant to the objects or mandate of ESAP.
8.2 Responsibilities of Members
Members are responsible to act in good faith to facilitate and advance the effective operation of the
ESAP, including:
(a)
(b)
(c)
(d)
to provide independent advice;
to read all briefing notes and related documents;
to attend all meetings of the ESAP, except for reasonable cause notified to the Chairman prior
to the meeting;
to participate actively in discussions within the ESAP in a manner which is legitimate, focused,
constructive and intended to achieve the objective and fulfil the mandate of the ESAP;

(e)
(f)
(g)
to bring to the attention of the ESAP all relevant stakeholder concerns and grievances known
to the member;
to observe all applicable deadlines; and
to assist in the preparation of ESAP reports.
Members must inform the Chairman of any potential conflicts of interest which may impact on their
capacity to provide independent advice and/or maintain confidentiality or which otherwise affects such
members in the discharge of their responsibilities.
8.3 Responsibilities of HVJV
HVJV is responsible:
(a)
(b)
(c)
(d)
(e)
to ensure that the ESAP is provided with the resources and assistance necessary to discharge
its functions, including making available HVJV management and employees to brief the ESAP
on key issues;
to respond in a timely manner to all reasonable requests from the ESAP for information;
to make all reasonable efforts to ensure that senior representatives of HVJV attend meetings
with, and are accessible to, the ESAP (if invited by the Chairman);
to keep the ESAP apprised of any significant internal or external HVJV developments which
may impact on the advice given by the ESAP;
to provide feedback on follow-up actions, if any, taken or to be taken by HVJV in response to
issues or concerns raised in any report of the ESAP;
9. CONFIDENTIALITY
In the performance of their duties and functions as such, members and the secretary may be given
access to or may become aware of information and data which is commercially-sensitive and
confidential to HVJV, the joint venturers and their Related Bodies Corporate.
Each member and the secretary must ensure that all information and data disclosed to the ESAP by
HVJV or which otherwise becomes known to the member and/or secretary by virtue of their
participation in the ESAP is kept confidential and shall be used by the member and the secretary solely
and exclusively for the performance of their duties and functions as such.
Disclosure of such information and data to any third party other than in accordance with these Terms of
Reference and Procedures shall not occur without the prior written consent of HVJV.
10. ADMINISTRATIVE MATTERS
All reasonable administrative support for the operation of the ESAP will be provided by HVJV at the
cost and expense of HVJV.

11. VARIATION
HVJV may at any time change these Terms of Reference and Procedures by notice in writing given to
the Chairman and the secretary, which notice the secretary will distribute to all members.