High gold prices to sustain extension of Padcal mine life

MANILA, Philippines — Pangilinan-led Philex Mining Corp. will be able to extend the life of its Padcal mine until 2027 if gold prices remain above $2,000 an ounce to ensure that the firm is not running at a loss.

Philex president and CEO Eulalio Austin Jr. said they are optimistic that the life of the firm’s mine in Tuba, Benguet would last until 2027 based on prevailing world prices of gold and copper.

At present, gold prices are hovering around $2,300 an ounce while copper prices are about $4.3 per pound, based on the latest World Bank report.

“We are happy at $3.5 per pound for copper and $2,00 an ounce for gold,” Austin told reporters on the sidelines of the mining firm’s annual stockholders’ meeting yesterday.

Austin said Padcal is currently producing gold at $1,800 an ounce and copper at $3.4 per pound. Padcal’s costs have increased due to higher costs of electricity and fuel, he added.

“We are trying to go deeper or do some maintenance of old equipment,” he said.

“(If the prices of gold fall below $2,000) it would be quite difficult (for us to extend the mine life),” he added.

Last year, Philex extended the life of its Padcal mine by another three years up to 2027 after confirmatory drilling yielded additional mineable reserves.

The completed confirmatory drillings on the ore body and technical studies on the mining methodology and tailings storage facility No. 3 successfully identified additional mineable reserves of 24 million tons in its Padcal mine.

At an annual production rate of 8.1 million tons, Padcal mine’s life is extended by three years to Dec. 31, 2027.