Papua New Guinea (PNG) could soon become one of the top three gold producing countries in the world if the current mining and exploration trend in the country continues, according to Deputy Prime Minister Don Polye.

The National, a local daily newspaper, reported Thursday that Polye said PNG was currently ranked 11th as a gold producing nation but with all the activities currently happening in the mining sector, it was likely that PNG would soon be producing more gold as well as other metals.

He said the turn around in the mining industry came about after the Government discussed with mining and petroleum industry experts to boost the industry which had stagnated over the last 10- 15 years.

"As a result of the discussions, the Government introduced the 2002 tax review aimed at elevating the internal rate of return for 'model' copper and gold mines in PNG," said Polye.

He said these tax reviews included the double deduction of pre- production exploration costs, depreciation, loss carry forward time limit and premiums for entities wishing to make use of the Fiscal Stabilization Act.

Polye said those changes had transformed perception of investors to PNG.

"Investors can see that compared to other countries where the rate of return in mining and exploration is around 10.8 percent, PNG's rate now stands at 14.8 percent internal rate of return for mining investors," he said.

Source: Xinhua