Global miner Xstrata Plc's Philippine unit has delayed by three
years, to 2019, a target to start production at the $5.9-billion
Tampakan copper-gold mine in the country's south, as it remains hopeful
of winning approvals from regulators.
Conflicting rules and a freeze on new mine deals in the Philippines are
strangling development of the country's untapped mineral resources,
estimated by the government to be worth $850 billion.
The Tampakan project, which would be the Philippines' single largest
foreign direct investment, has been held up by a 2010 ban on open-pit
mining imposed by the government of South Cotabato province, the site of
the mine.
Sagittarius Mines Inc. (SMI) hopes to
start mine construction by 2015, two years later than scheduled, before
production starts in 2019, the company said in a statement. It
originally aimed to start production in 2016.
So
long as the project received local government endorsement and final
approvals from the national government, it would go ahead, subject to an
investment decision by shareholders, SMI president Peter Forrestal
said.
"Construction could potentially commence in 2015, enabling commercial production in 2019," he added.
Sagittarius has had problems getting approvals from the mining
regulator for Tampakan because of the ban, which contradicts a national
law that is silent on mining methods.
Sagittarius is also partly owned by Australia's Indophil Resources NL,
in which Philippine conglomerate San Miguel Corp. has a stake of 10
percent.
The Tampakan mine is estimated to contain 15 million tons of copper and 17.6 million ounces of gold.
As a result of the Philippine mining imbroglio, investments in the
sector over the next four years are likely to be less than half the $12
billion originally forecast, state regulator the Mines and Geosciences
Bureau has said.
In October, President Benigno
Aquino III said he wanted Congress to first pass legislation to raise
state revenues from mining and put in place environmental safeguards
before issuing new mining permits, including those for the Tampakan
mine. — Reuters
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