MVP, SMC keeping Tampakan stakes

MANILA, Philippines - Two of the largest Philippine conglomerates led by corporate rivals are keeping their minority shares in an Australian miner that partly owns the $5.9-billion Tampakan project in Mindanao.

The mining units of First Pacific Co. Ltd. and diversified conglomerate San Miguel Corp. (SMC) are on a wait-and-see stance amid a potential Tampakan leadership shakeup and continuous delay in one of the largest undeveloped copper and gold deposits in the world.

“Yes hold for now anyway,” Manuel V. Pangilinan, CEO of Hong Kong-based First Pacific and chairman of Philippines’ largest miner Philex Mining Corp., told The STAR.

“Hold lang muna,” SMC president and chief operating officer Ramon S. Ang said in a separate interview.

Both industry leaders said they will hold on to their shares amid uncertainties and pending clearer details on the copper and gold project.

So far, SMC subsidiary Coastal View Exploration Corp. holds 48.016 million shares or 3.99 percent of Australia’s Indophil Resources NL, which owns 37.5 percent of Tampakan while Philex owns 15.63 million shares or 1.3 percent of Indophil.

SMC and First Pacific’s local unit Metro Pacific Investments Corp. have been rivals in local businesses like toll roads, airports, power distribution and telecommunications.

Xstrata Plc., the world’s fourth largest copper miner, controls 62.5 percent of Tampakan through project manager Sagittarius Mines Inc. (SMI).

However, Tampakan might be sold off as global commodities giant Glencore International completes its $67-billion takeover of Xstrata.

In April, the Chinese Ministry of Commerce approved the mega-deal on the condition that Glencore will unload its $5.2-billion Las Bambas project in Peru or one of four major assets like Tampakan by 2015. Chinese regulators want Glencore to trim its mining projects in hopes of lowering the miner’s influence in global copper trading.

In August last year, SMI admitted that the start of commercial operations of Tampakan will be delayed from the earlier target of 2016 due to regulatory issues.

SMI secured an Environmental Compliance Certificate, a key document that will enable it to start mine development and operations, from the Department of Environment and Natural Resources in February.

However, there is a long-standing ordinance in South Cotabato banning the use of open-pit mining method.

The $5.9-billion Tampakan project is considered the largest undeveloped copper and gold deposit in the Southeast Asia and Western Pacific region.

The Tampakan copper and gold mine likely contains 13.9 million metric tons of copper and 16.2 million ounces of gold. The mine is expected to add one percent to the country’s gross domestic product per year given its large output.