Philex Mining keen on Masbate gold project

MANILA, Philippines - Philex Mining Corp. is reportedly keen on the Masbate gold project prior to the closure of its  Padcal mine in Benguet owing to a waste spillage, sources said.

Philex has deferred plans to acquire more mines pending completion of an investigation into the leakage of wastewater into a river from the company’s Padcal copper-gold mine.

Sources said Philex is setting its sights on the Masbate gold project, which is believed to be rich in mineral resources.

The Masbate gold project was acquired by Australia’s CGA  Mining Ltd. in March 2007 and is now one of the largest gold producers in the country.  In the first half this year, CGA processed 3.31 million tons of ore with an average grade of 1.1 grams of gold per ton. 

Other sources said Philex is also interested in Apex Mining Corp., which holds a mineral production sharing agreement (MPSA) for a copper-gold deposit located at Maco, Compostela Valley.  Apex, which mines an average of 700 tons of ore a day, is expanding its existing ore processing facility as part of a business plan aimed at developing new vein systems and boosting production to ounces per year by 2015.

Philex chairman Manuel V. Pangilinan said the company is close to finalizing discussions for one operating mine but decided to postpone it until they get a clear view on how long and how much the rehabilitation of the Padcal mine will take.

“In terms of new mining acquisitions, I think it is prudent to defer [them],” Pangilinan said.

Pangilinan’s group earlier said it is looking at acquiring three mines, two in the Philippines and one in Indonesia.

Philex said the Padcal mine will remain suspended until such time that the safety and integrity of its tailings pond are assured.

The suspension of the Padcal mine’s operations will put a dent in Philex’s bottom line, making it impossible to meet its 2012 core income target of P4 billion. The suspension will cost the company P220 million a month.