Lafayette Gets Philippine Mine Test Extension

Lafayette gets Philippine mine test extension

Mining Journal

8th November 2006

http://www.mining-journal.com/Breaking_News.aspx?breaking_news_article_id=1032

Melbourne-based Lafayette Mining Ltd has been given a second extension to run tests on its gold and copper project after two cyanide spills last year.

The mine on Rapu Rapu island suspended operations three months after pouring its first gold in July 2005 due to the incidents and is running the mine on a temporary operating order.

It completed a 30-day trial run in early September but sought a 60-day extension that ended on Wednesday. The company then asked for a second extension of 30 days to make up for time lost due to typhoon `Milenyo`, which hit the main island of Luzon in late September.

"We had the typhoon that hit Rapu Rapu. There were electrical posts that were down. We easily lost 10 days, Julieto Sarmiento, a Lafayette spokesman, told Reuters, adding the company had to wait for the release of official permits before proceeding to the second and third phases of the trial run.

Environment Secretary Angelo Reyes said in a statement the second extension would enable Lafayette to present more proof that it has complied with the Environment Department`s standards on safe and sustainable mining. "We will not allow Lafayette to operate until it has shown that it has complied with all the requirements - particularly the environment, social and technical responsibilities," Reyes said.

The Rapu Rapu mine is the first foreign-owned mine to open in the Philippines after the Supreme Court upheld in December 2004 the legality of a law allowing foreign firms to own 100 percent in local projects from the previous 40 percent and is one of 24 being promoted by the government to revive the country`s once-mighty mining sector.

Before the suspension, the mine was forecast to generate annual revenues of US$350 million from production of 10,000t of copper in concentrate, 14,000t of zinc, 50,000oz of gold and 600,000oz of silver.

South Korea`s LG International Ltd and the South Korean government`s resources investment arm KORES together hold 26% of Lafayette Philippines while rest is owned by its Australian parent.