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Philex confirms 4 mine leaks in Padcal tailings pond in August

Philex tells the stock exchange there were 4 leaks at its only operating tailings pond at Padcal mine site for a single month

MANILA, Philippines (UPDATED) – Gold and copper producer Philex Mining Corp said “unfavorable weather conditions” at its Padcal mine site in Benguet province have caused its tailings facility to leak 4 times in the month of August.

“We confirm that this discharge has been the fourth reported since the first incident that occurred on August 1, 2012,” Philex told the exchange on Tuesday, September 4, in response to a report that cites a local official of the Department of Environment and Natural Resources (DENR).

The latest reported wastage spillage at its only operating tailings pond at the mine site was last Thursday, August 30.

“We confirm that the discharge of tailings from one of the two underground tunnels of the penstock in the tailings pond of the Padcal mine recurred at 2:40 am of August 30, 2012, Thursday, and that this was contained at about 6:30 am on the same day,” Philex added in the disclosure.

The other two mine leaks were minor, according to a Philex official.

The recent incidents at Padcal occured at a time the Philippine government is drafting rules and regulations on Executive Order 79, which sets the Aquino government’s policy on the mining industry. Anti-mining groups have claimed that mining is inherently destructive to the environment, and have questioned claims of industry players that mining can be responsibly pursued.

P325-million fine

Philex also told the exchange on Tuesday that it has yet to receive official copy of the reported initial P325 million fine that the environment department and mines bureau has imposed on them based on finding on the first tailings leak on August 1.

The P325 million fine was based on violation of the Mining Act, which imposes a penalty of P50 per ton of sediments spilled from tailings facilities. This still excludes the other fines that may be imposed on the firm for violations of the Clean Water Act and the ECC (Environmental Compliance Certificate) contract.

“We cannot comment on the alleged P326 million fine for the discharging of up to 6.5 million tons of tailings on August 1, 2012 from the Padcal tailings pond as we have not received any official communication from the government on this matter,” it said.

“As of this time, because of the continuing unfavorable weather conditions at the mine site, we cannot as yet determine the volume of tailings discharged from the pond,” it explained.

Several weather disturbances have been bringing record amount of rainfall in various parts of the country during the month.

The tailings pond facility is located above various water systems in north Luzon.

It is about 30 kilometers downstream of Agno River from its convergence with Balog River. The drain tunnels of Philex discharge their water load into the Balog River, which, in turn, runs for about 2.5km to converge with Agno River.

Philex has 3 tailings pond but only tailings pond no. 3 is actively used. The two other ponds have been decommissioned and rehabilitated as forest areas.

Plugging the leaks

Philex’s Padcal mine operations remain suspended as corporate and government officials work on the tailings leaks.

“Our current focus is towards the remediation and rehabilitation of the concerned penstock tunnel for which we have retained domestic and foreign third party consultants to provide assistance, particularly towards assuring the safety and integrity of the tailings pond for the resumption of the mine’s operations,” it added.

In a statement on Monday, September 3, Philex said it has stepped up its efforts to plug the sinkhole in the tailings pond following the “accidental discharge.”

“Despite the bad weather, we have been working 24/7 on long-term solutions to ensure no further outflows of sediment occur,” Philex Mining President and COO Eulalio Austin, Jr. said. “This is ongoing while our employee-volunteers are continuously working on the cleanup and rehabilitation of Balog and the convergence to Agno.”

He said Philex is creating more access trails to the rugged terrain leading to the Balog Creek to enable volunteers to have easy access to the waterway for rehabilitation.

Philex said the incident was reported immediately to the Mines and Geosciences Bureau (MGB) and the Environmental Management Bureau (EMB) and was contained on the same day.

MGB director Leo Jasareno said the leakage was controlled within a few hours.

“Our team in Padcal reported that the plugged tailings pond leaked last Thursday but this was plugged again in a few hours,” Jasareno said.

Millions of loses

It will cost Philex P220 million a month to maintain the indefinite suspension the mine while rehabilitation plans are put in place. Lost revenues, meanwhile, was placed at P30 million to P40 million per day.

Pangilinan, earlier said, however, that the company has sufficient resources to undertake the cleanup and rehabilitation of the mine site.

Philex also said that it has provided immediate assistance to families living near the Padcal mine who were affected by the spillage.

The company said it has prepared the Integrated River Basin Management (IRBM) program, which focuses on aquatic, terrestrial, and water resources management for  the cleanup and restoration of the Agno River and Balog Creeks.

“The program also has a social component, which promises to bring households affected by the spillage back to, if not better than, their previous status,” said Austin.

Padcal mine ending

The Padcal mine, which has been operating nonstop since the 1950s, is expected to last only until December 2020.

Philex has been scouting for new mines to sustain profitability ahead of the end of Padcal’s mine life. 

Philex has an ongoing $1-billion investment in its Silangan project in northern Mindanao. The company wants to put the mine on stream by 2016.

Philex is waiting for a permit from the government to pursue further activities at one of the two mining areas in Silangan. However, the EO-79, which one imposed a moratorium on all new contracts, put Philex’s Silangan project at a standstill. – Rappler.com

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