Philex raising $300 million for Silangan project

MANILA, Philippines — Philex Mining Corp. plans to raise around $300 million from investors to jumpstart the Silangan copper and gold project via sub-level cave mining method, an official of the company said.

In an interview, Philex president and CEO Eulalio Austin Jr. said the company is targeting to raise 40 percent of the $750 million initial capex for the project.

“We need $750 million to start the project, to bring out the first ton of ore from the underground,” Austin said.

Last month, Philex announced it is seeking partners for the Silangan project as it appointed JPMorgan for equity investment and Japan’s Mizuho for project financing.

“There are interested (partners). Because we tapped JP Morgan,there are indications already. But we still don’t know if we could raise 40 percent of $750 million,” Austin said.

He said the company would look for investors until the end of the year.

“We are targeting that early December, more or less, we have an idea who are the prospective investors. That’s why March or April, there would be finalization of contracts,” Austin said.

The company official said they are targeting to start the project late first half of 2020, once they receive the fund from investors.

“We’re expecting the money from the equity investors to come in in March, April or May and then we start early development first,” Austin said.

He added early development works will include building the infrastructure –roadworks, opening of the portal, initial construction of the tailing span, and environmental controls.

If Philex is able to get the funds and start the project on time, Austin said the company is expecting the partial operations of the mine by July 2022.

Silangan’s tenements consist of three deposit areas – Boyongan, Bayugo and Kalayaan, with the latter representing a joint venture with Manila Mining Corp.

The Silangan mine, situated in Surigao Del Norte, is considered one of three big-ticket projects that will make the Philippines a major copper producer.

Philex said the Silangan project would be developed in phases, with the Boyongan deposit as the first phase.

The company earlier completed a definitive feasibility study for the initial phase and found that the Boyongan deposit is expected to yield high grade mineable ore grades of 0.63 percent for copper and 1.20 grams per ton for gold.

The second phase, which will be comprised of the Bayugo deposit, is scheduled to undergo preliminary feasibility study for underground sub-level cave mining within 2019. Bayugo is expected to be mine-ready as early as the fifth year from the start of Boyongan’s commercial operations.

Philex said the remaining substantial mineral resource and inventory including Kalayaan and the remnants of Boyongan will be subjected to future studies.