Philex, Manila Mining revive deal for joint development of mine sites

MANILA, Philippines - Two of the country’s biggest mining companies are nearing an agreement to jointly explore and develop certain properties.

Philex Mining Corp. and Manila Mining Corp. already have a “meeting of the minds” on the basic commercial terms for the joint exploration/survey of certain properties adjacent to Philex’s Boyongan property in Surigao del Norte, in particular the Kalayaan copper-gold project of Manila Mining, Philex chairman Manuel Pangilinan said.

Pangilinan revealed in an interview that while the agreement between the two mining companies is still in the documentation stage, it will most likely involve a joint venture, with Philex having a 60 percent stake and Manila Mining, 40 percent.

The Kalayaan property is north of the Boyongan property. Pangilinan said their participation will most likely be in the form of a farm-in agreement, with Philex shouldering the initial exploration/survey and Manila Mining as the owner of the property.

 Pangilinan said it makes sense for Philex to develop its Boyongan property with adjacent properties such as the Kalayaan site as one “to derive economies of scale.”

 In addition, he revealed that Philex will be developing another property which it owns, Silangan which is east of Boyongan. “We will operate and develop this on our own,” he said.

 Manila Mining said earlier it remains in talks with Philex over the possible sale of a portion of its stake in the 2,463-hectare Kalayaan project. Manila Mining has two existing mining lease contracts with the government in Surigao del Norte and three mineral production sharing agreements covering Surigao del Norte and Agusan del Norte. Its wholly-owned subsidiary Kalayaan Copper-Gold Resources Inc. operates the mine site.

 Philex acquired full ownership of the Boyongan copper-gold project in Surigao del Norte after buying the 50 percent stake of Anglo-American Exploration BV and Anglo-American Exploration (Philippines) for $55 million. It also owns and runs the Padcal mine in Benguet province,the only remaining copper-gold company operating in the country.