Wellex Mining, a unit of the Gatchalian-owned Wellex Group Inc., is in talks with two Chinese companies to jointly develop a portion of its Dinagat Island chromite mine site.
Located on the southern area of Leyte Gulf, Dinagat Island is known to have rich chromite and nickel deposits.
Weslie T. Gatchalian, president of Wellex Mining, said the two prospective Chinese investors are end-users with processing plants located in various provinces in China.
Gatchalian said talks include the establishment of a joint venture company in the Philippines to serve as the corporate vehicle for the proposed project.
He said the company is deadset on pursuing the development of its 2,400 hectare chromite property in Dinagat Island in spite of the sharp drop in the prices of industrial metals and other minerals.
Wellex Mining owns a total of 3,700 hectares in Dinagat Island. It has already blocked 350 hectares of chromatic area with a tonnage of 250,000 DMT of chromite ore (Cr2O3) averaging 50 percent. As part of its aggressive moves for the development of the area, simultaneous constructions at the facility are now being undertaken.
Ongoing activities within the site include building of roads, jetty, water source and other facility in preparation for large-scale chromite operation.
Gatchalian noted that “exploration results indicated superior quality of ores including the presence of gold in our area. Thus, we are continuing our efforts in identifying more highly mineralized area within the site.”
He said Wellex Mining continues to support the programs of the government particularly in reviving the mining industry.
While he declined to say how much the company was willing to invest in the development of its chromite mine site, funding would be sourced through internally-generated cash.