Mining investments seen to reach $8B in med term

Investments in the resurgent local mining sector totaled $372 million in the last three years and is expected to accelerate, reaching at least $8 billion in the medium-term on the back of increasing demand for metals in the world market.

Data from the Mines and Geosciences Bureau (MGB) indicate that investments in the mining industry had been lackluster from 2003 to 2004 as mining companies reeled from the 2003 Supreme Court ruling that deemed the Philippine Mining Act of 1995 unconstitutional.

In 2003, investments totaled just $201 million and plunged to only $47 million in 2004. However, the SC’s reversal of its 2003 ruling in late 2004 gradually restored investor confidence, new mining investments reaching a total of $107 million in 2005.

Jobs generated also increased from 2,716 in 2004 to 3,370 in 2005.

The MGB said that in the medium-term, more investments and new jobs will be created as metal prices in the world market are expected to sustain their rally due to increasing demand, especially by the vibrant economic activities in China and India.

The MGB said foreign and local investors have shown strong interest to pursue over the next five years up to 24 medium and large-scale mining projects requiring new investments of $8 billion.

The primary minerals production will come from gold, copper and nickel mining projects.

This year, the Department of Environment and Natural Resources (DENR) will assess the mining sites of Basay Mining Corp. and Consolidated Mines in Negros and Surigao del Norte, respectively.

It will also start the rehabilitation of the Bagacay Mines in Western Samar.

The MGB will also conduct geo-hazard mapping in 314 municipalities and will update 122 topography-based maps.

A mining update by the MGB shows that nine mining firms are still pursuing groundwork activities in preparation for subsequent full-scale mining operation.

Filminera Resources Corp. recently completed its $1.1-million infill drilling program in its Masbate Gold project. Its feasibility study is expected to be completed by early 2006 and construction of its processing plant is expected to start in June next year. Commercial operation is projected to start by July 2007. To date, the company has invested a total of $13.836 million.

On the other hand, Itogon Suyoc Resources Inc. raised its total accumulated investments to $2.599 million for its gold project in Benguet.

Philex Mining Corp. also advanced the development of the Sto. Tomas II Copper Expansion Project. The production area is now producing at the rate of 75 metric tons per day for each drawpoint. The company has drilled about four drawpoints to date.

TVI Resources Development Phils. is expected to invest an additional $2 to $3 million to upgrade facilities and increase the capacity of its gold plant from 650 tons to 1,000 tons daily.

The DENR also approved a feasibility study on the Didipio Copper-Gold project in Nueva Vizcaya-Quirino provinces. Construction is slated to commence anytime next year.

Also, DENR reinstated the mineral production sharing agreement of Aglubang Mining Corp. last November so that it can resume its exploration of nickel and cobalt ore deposits.

Other activities include the recent approval of the feasibility proposal of Surigao Integrated Resource Corp.; the ongoing confirmatory drilling activity of Colet Mining and Development Corp.; and, the ongoing feasibility project of Red 5 Limited for its proposed mining program in the Siana Gold Project in Surigao del Norte.