Development Funds
OTML works with a number of schemes to oversee developmental works, and trusts to administer funds and compensation payments paid by OTML to affected communities. OTML also helps to implement government schemes for development in the area.
Tax Credit Scheme
The Tax Credit Scheme, established by the national government in 1996, is a program in which OTML plans and constructs government facilities, and claims back the cost against tax due to the National Government under company income tax rules.
All projects must obtain full approval of the scope and cost from t
he Provincial Administration, the Mining Department, and the Internal Revenue Commission before they commence.
To date, OTML's participation in the Tax Credit Scheme has resulted in K84 million being spent on the development of infrastructure such as schools, hospitals, police barracks and air strips in Kiunga, Tabubil, Ningerum and other regions of the Western Province, Telefomin district of the Sandaun Province and PNG generally.
It is estimated that more than half of the Western Province population benefit from the services provided by the TCS program.
Special Support Grant
The Special Support Grant (SSG) is a national government-funded grant, originally established to bring infrastructure to the provinces.
By agreement with the government, these grants are administered by OTML in the Western Province to support projects determined by local level governments.
Projects funded by the SSG have included building and maintenance of schools, roads, bridges, government buildings and hospitals. To date, projects have been funded to the value of K1.8 million.
Restated Eighth Supplemental Agreement - Heduru Limited
The Restated Eighth Supplemental Agreement between OTML and the State of PNG established a general compensation regime for people along the Ok Tedi/Fly River system. It also provided for a 10 per cent shareholding to be acquired by the State for the benefit of the people of the Western Province.
The money paid by OTML is held in the Western Province General Compensation Trust and is administered by a trustee, Heduru Limited.
Heduru Limited has seven board members: two from the national government (including the chairman), three from the local government and two from OTML.
Payments comprised K10 million for 1984-1993 and K4 million for 1994. Amounts thereafter have been adjusted for inflation and mine production but are never less than the preceding year. To end 2004, OTML paid more than K75 million under this agreement.