Foreign firms keen on Lafayette mine
Published by MAC on 2006-09-07Foreign firms keen on Lafayette mine
7th September 2006
Three foreign firms are interested in investing in the Philippine gold and copper mine of Australia's Lafayette Mining Ltd if Manila allows it to reopen, the company's lawyer said.
The Lafayette project on Rapu Rapu island, one of 24 being promoted by the government to revive the country's once-mighty mining sector, suspended operations three months after pouring its first gold in July 2005 due to two cyanide spills.
The government allowed the mine to conduct a test run from July 10. That was supposed to end on September 9 but lawyer Bayani Agabin said Lafayette had asked for a 60-day extension.
"If things work out properly, we hope to get a permanent listing order," Agabin told Reuters on the sidelines of a plant tour on the remote island southeast of Manila.
He said prospective investors included firms from Singapore, Australia and Canada but declined to identify them. Agabin said officials from the three firms had visited the Rapu Rapu mine.
"The discussions are still very general at this stage," he said.
Rapu Rapu has completed the first two phases of the test run - a five-day water test and a nine-day water and rock test. The third phase, which simulates actual operations using ore and chemicals, should end on Saturday.
"It will be easier to convince the public that we are compliant with standards if we hold more test runs on our pollution facilities," Agabin said.
Officials from the Mining and Geosciences Bureau said the extension would also enable Lafayette to debug its new base metals plant before it begins commercial operations.
"As far as the technical merit of the 60-day expansion is concerned, we see no problem with it," said Michael Cabalda, head of the bureau's Mining Environment and Safety Division.
Environmentalists and some influential Catholic bishops have opposed a Philippine law allowing for 100 per cent foreign ownership of mines.
Before the suspension, Lafayette was forecast to generate revenues of $US350 million ($A457.07 million) a year from production of 10,000 tonnes of copper in concentrate, 14,000 tonnes of zinc, 50,000 ounces of gold and 600,000 ounces of silver.
In June, Lafayette paid a fine of 10.4 million pesos ($A270,323.21) imposed by the Philippine government after the spills at the mine.
South Korea's LG Co International Ltd and the South Korean government's resources investment arm KORES together hold 26 per cent of Lafayette Philippines Inc.
The rest is owned by the Australian company.