Philex defers mine acquisitions after Padcal closure
MANILA, Philippines - Philex Mining Corp, the country's biggest copper-gold producer, is postponing plans to acquire more mine projects following the closure of its Padcal mine in Benguet due to a waste spillage.
Philex chairman Manuel V. Pangilinan told reporters the company was supposed to acquire an operating mine "quite soon," but decided to defer it.
"I think for the moment it is best to delay that until we have the opportunity to look at the situation in Padcal. I think once we have a clear plan on how to rehabilitate Padcal, that's when [we will acquire]," he said on the sidelines of the financial briefing of Philex affiliate Metro Pacific Investments Corp.
Pangilinan declined to identify the site they were supposed to invest in.
Previously, he said Philex was eyeing to acquire 3 new mining projects -- two in the Philippines and one in Indonesia.
If they push through, the acquisitions would help the company meet its target of being a medium-sized gold producer with an annual gold output of one million ounces.
But Pangilinan said, "We should not go recklessly into a new mining investment without figuring out what went wrong in Padcal."
He said however that Philex's $1-billion Silangan project in northern Mindanao will continue. The company wants to put the mine on stream by 2016. "Exploration in Silangan will continue."
The Padcal mine was ordered closed by government on August 1 after waste leaked from its tailings pond.
Philex said heavy rain from successive tropical cyclones weakened the pond's structure.
Pangilinan said mine operations will remain suspended until safety requirements are met.
He said the closure is expected to result in P220 million losses per month for the company.
"Full-year earnings of Philex will be materially impacted," he said.
Philex has been scouting for new mines to sustain profitability ahead of the end of Padcal's mine life.
Padcal, which has been operating nonstop since the 1950s, is expected to last only until December 2020. - Rappler.com, with a report from Katherine Visconti
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