The East New Britain Development Corporation has described the project "as it is a disaster in waiting" and has called on the provincial government to address the concerns.
The National newspaper reports that corporation chief executive Michael Baitia raised its issues during the presentation recently at Kopoko.
The presentation was being done by the Mineral Resource Authority to discuss alluvial mining and geothermal resources policies of the Department of Mineral Policy and Geohazards Management.
Baitia who has more than 10 years of experience in the mining and petroleum industry said a lot of questions were raised following the granting of a licence to New Guinea Gold to develop the project.
"The licence shouldn't be granted to New Guinea Gold because it was not a big player. Technologies used were from the 1960s and are out-dated.
"For the government to give its right to a small player or mining company to develop the resource which is owned by the State is a big giveaway."
Baitia suggests to the Mining and Environment minister to re-look at the project and the mining development contract granted by MRA, highlighting the potential for environmental pollution from the mine.
In April last year, then Conservation Minister Wera Mori warned about cyanide poisoning from toxic waste emanating from Sinivit following failed attempts to clean up the mine which was previously owned by Canadian miner New Guinea Gold. Apparently the government has not provided the money it said it would to fix the mine's problems.
"We have a very dangerous situation where there is exposure to cyanide and if we don't get our act together and if the government does not make the money available for us to decontaminate the site and get rid of the waste, then we will subject our people to potential dangers."
Mori said plans were under way to export the material overseas for safe storage. "We may be considering exporting to other countries such as Australia," he said. He said the decontamination and clean-up of the cyanide waste in the river system at the mine would cost between K6 million to K8 million.
"The volumes of the creeks there are not enough to allow for natural dilution and, therefore, if such waste including those that are exposed make their way into the creeks, it may have catastrophic consequences," he said.
"We are not only looking at a clean-up but we have to decontaminate before we clean it up. "We have got to put in access roads but most importantly, the waste that can be captured will have to be removed from site and stored elsewhere that is much safer than having them stored in the ground."
Mori said the government was not yet able to provide the funding but an assessment had already been done for the decontamination and clean up exercise.
New Guinea Gold began mining Sinivit in 2007, an operation which is 50km south-south-west of Rabaul in the Baining Mountains of the Gazelle Peninsula.
The mine was a series of shallow open pits from which gold oxide ore was extracted.
The Sinivit Mine Landowners Association has constantly called on the East New Britain provincial government to fund an independent audit into the operations of the abandoned Sinivit gold mine.
New Guinea Gold abandoned the project in September 2014 after blaming the government and the Mineral Resources Authority for not quickly renewing their mining licence.
It is understood MRA had notified the company to return and rectify safety and environmental issues related to the Sinivit project but this has not eventuated.
Authorities say there are 29 abandoned vats used to extract gold and other minerals at the mine site which have been damaged by heavy rain and flooding. The have the potential to discharge chemical contaminants into nearby rivers of Warangoi and Nengmutka.