Philex to start Silangan mine in 2017

Rappler.com
Philex said its feasibility study was on track for its Silangan mine, which is set to open by 2017

MANILA, Philippines – Philex Mining Corp, the country’s biggest gold producer, reported that it is actually on-track to start production in at least one area of its Silangan gold and copper project by 2017.

In a statement to the Philippine Stock Exchange on September 10, Philex said it is confident “that the Silangan Project will commence production by 2017, as the pre-feasibility study and mine development are being pursued aggressively.”

Philex was responding to reports that it delayed the production schedule at its mine in Surigao del Norte in northern Mindanao, citing regulatory issues.

The firm said the mine and production feasibility study will be completed as scheduled by February 2013.

“We’ve increased the number of foreign consultants involved in the pre-feasibility stud of the project,” Philex added.

“To date, the studies for the Silangan Project have not revealed any obstacles to the commencement of production by 2017 or any reduction in resource estimates of its potential,” said Philex.

The firm says studies for the project show that from their end it is a go, government approval could be a latent obstacle to opening the Bayugo area.

Philex Chairman Manny V. Pangilinan said the Silangan project could be delayed because of the executive order on mining signed by the President in July.

Executive Order No. 79 temporarily blocks the issuance of new mining contracts pending an amendment to the Mining Act’s provision on mineral production sharing agreements (MPSAs) between government and mining firms.

“There are two pieces of property in Silangan – Boyongan and Bayugo properties. Boyongan already has the MPSA, so we have the relevant permits to do that. We don’t have the same for Bayugo since we just have an exploration permit. That might be delayed because of this EO,” Pangilinan said in July.

The mining firm has yet to confirm with Rappler if the 2017 start of production will include both mine areas of Boyongan and Bayugo.

In the meantime, Philex said it is conducting exploration drilling in the neighboring Kalayaan project, which sits beside the Bayugo deposit.

In May 2011, Philex entered into a joint-venture agreement with Manila Mining Corp for a share of the Kalayann project. Philex said it would disclose the resources in the project at the appropriate time.

Philex is eyeing the Silangan mine to help sustain the company’s future operations given that the only operating mine — the Padcal mine in Benguet province — will exhaust its mineral resources by 2020.

Operations at Padcal mine is currently suspended following leaks at its tailings pond. Philex said losses at Padcal will impact on its 2012 bottomline. – Rappler.com

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