DENR okays Picop Resources forestry plan

Picop Resources, Inc. will not be shutting down by the end of the month after all.

Vicsmarte Ubalde, Picop corporate information officer, told the Philippine Stock Exchange that it received last week the Department of Environment and National Resources approval for the conversion of its forestland under Timber Licensing Agreement (TLA) 43.

"This development provides the basis for a long-term assurance of wood supply to Picop’s pulp and paper mill," Ubalde said.

However, he added they still have to get DENR clarification on the issues of planted tree ownership and harvesting in Picop’s Integrated Forest Management Area (IFMA) 35, the main source of its wood raw material for newsprint.

Still, Ubalde said the DENR approval would enable Picop to restart its various operations and steadily increase production volume once progress is made on their talks with the DENR.

Early this month, Picop tendered a notice that it will be halting operations for three to six months starting Oct. 31, 2001.

"The reasons cited are the low prices of competing products, being imported at dumped prices and the delayed approval by the DENR of the company’s annual operating plan which prevents the company from access to its wood raw materials," the company said.

The shutdown was expected to affect 3,000 direct employees and 5,000 workers indirectly involved in its wood, pulp mill and allied operations. If the shutdown had materialized, the company would have had to depend on existing inventories and financial resources while the closure lasts.

Picop Resources, formerly Paper Industries Corporation of the Philippines (PICOP), operates its milling plant and wood plantation in Bislig, Surigao del Sur. Once Southeast Asia’s largest integrated wood and paper milling company, PICOP was listed in 1973 and transformed into a holding firm in 1997 as it ventured into particle board manufacturing and palm oil plantation.

Last year, Picop generated total revenues of P2.422 billion but has remained in the red with net losses of P215.352 million.