San Miguel eyes nickel refinery in Surigao

MANILA, Philippines – Diversifying conglomerate San Miguel Corp confirmed that it is in talks with controlling stockholders of the nickel refinery in Surigao in northern Mindanao.

In a disclosure to the stock exchange on Tuesday, January 24, San Miguel’s chief finance officer Ferdinand Constantino said an earlier report citing Surigao City Mayor Ernesto Matugas that the conglomerate has discussed with him a possible rehabilitation of the Nonoc Refinery project in the area is true.

“We advise that the company is in talks with the controlling stockholders of Philnico Mining Corp. and evaluating the viability of investing in the Nonoc Mining project,” Constantino said in the disclosure.

San Miguel was responding to the report that Mayor Matugas confirmed that San Miguel CEO Ramon Ang had signed an agreement with Philnico president Evaristo Narvaez last January 4, 2012 to assume the estimated $300 million debts of the firm with the local government.

The report also said Ang pledged to offset Philnico’s tax obligations with the P50 million-worth of works to extend the runway at the Surigao City airport by an additional 800-meter. San Miguel is doing the same runway extension project in Caticlan airport, the jumpoff point to Boracay island. 

Philnico acquired the refinery from the government in the 1990s, but the local government had to take back the asset after the mining firm failed to settle amortization payments due to its host.

Earlier, Chinese firm Jinchuan Group Ltd had also considered spending $1 billion to rehabilitate the refinery, but eventually dropped the plan.

San Miguel has three other small coal mines in South Cotabato province. There, it has also offered to help build a new hospital. – Rappler.com

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