Philex Mining gets govt clearance for $1.2-B Silangan mine

(Updated 12:04 p.m.) Philex Mining Corp. has been cleared by the Philippine government to proceed with the development of its $1.2 billion Silangan copper-gold mine, paving the way for production to potentially begin in 2018.

 

The Silangan mine in Surigao del Norte province in the southern Philippines represents Philex's biggest prospective revenue driver when its Padcal mine in the north closes in about 2020 unless it gets a mine extension.

 

The Department of Environment and Natural Resources had approved the project's development plan in an order signed April 10, Philex said in a filing to the stock exchange on Tuesday.

 

Shares in the miner rose as much as 5.3 percent, outperforming the broader market which was down 0.3 percent as of 0345 GMT.

 

The miner plans to seek loans later this year to finance as much as 70 percent of the project cost estimated at between $1 billion and $1.2 billion, Philex Chairman Manuel Pangilinan said last week.

 

According to initial estimates, Silangan's resources comprise 5 billion pounds of copper and 9 million ounces of gold – among the biggest in the country.

 

Unlike other big mining projects in the Philippines, Silangan is not affected by a local moratorium on approvals for new production. But it would be covered by a new tax regime that Congress may legislate on to increase the government's share of mining revenue.

 

Last month, Philex said an additional 110.9 million tons of estimated mineral resources would augment Padcal's mineable inventory, which would allow it to extend mine life beyond 2020.

 

Philex exports most of its Padcal copper concentrates to Japan for smelting by Pan Pacific Copper Co. Ltd., part of JX Holdings Inc. and partly owned by Mitsui Mining and Smelting Co. Ltd. – Reuters