Philex considers extended life for Padcal mine

MANILA, Philippines — Pangilinan-led Philex Mining Corp. is exploring the possibility of further stretching the life of Padcal mine beyond 2027, while it conducts scout drilling in the adjacent Macawiwili property in Benguet.

Philex president and CEO Eulalio Austin said the company is studying the viability of exhausting reserves in the Padcal mine drain tunnel, which would entail additional costs.

He said the drain tunnel transports all of the water from the mine toward the river system or tailings pond.

“What we are looking at right now is the reserve below this drain tunnel, if there will be resources or reserves below this drain tunnel. For sure, we have to do the economic computations again because there’s an added power cost of pumping out water from the mine,” Austin said.

“At the moment, we are still studying if the remaining reserve below the drain tunnel – even if we apply higher power and operating cost – will still make the mine viable,” he said.

If the study yields positive results, this could further extend Padcal’s mine life beyond 2027.

“Hopefully we can have the initial results by the end of the year,” Austin said.

In December 2022, Philex announced the extension of Padcal’s  mine life by another three years from Dec. 31, 2024 to Dec. 31, 2027 after confirmatory drilling yielded additional mineable reserves.

The company said the confirmatory drillings identified additional mineable reserves of 24 million tons at an annual production rate of 8.1 million tons.

Currently, Austin said Padcal’s output is at its peak at 20 million pounds of copper and 4,000 ounces of gold.

He said Padcal produces steady gold and copper ores in terms of volume, but the grades are getting lower.

“Actually, if you compare it with the previous years, production is constant, because we try to do the production schedule to have flat production for the last three years,” the company official said.

Meanwhile, Philex is conducting scout drilling in the Macawiwili gold mining project for a possible acquisition and in preparation for the eventual closure of Padcal mine “if we can no longer find resources to mine.”

This follows the signed term sheet between Philex and Macawiwili Gold Mining and Development Co. Inc. (MGMDCI), a 90-year-old company engaged in mineral exploration and production in Itogon, Benguet.

“That’s why we’re doing scout drilling because we still have to know its viability. That’s the purpose of our engagement with Macawiwili,” Austin said.

“We’re just a contractor of Macawiwili to do scout drilling on their property. After we have the results of drilling, that’s the time we sit down and discuss,” he said.

After the scout drilling, the Philex official said another  field drilling would be conducted “to increase your level of confidence” for a possible investment in the Macawiwili project.

“If we look at the experience of Silangan, that would take long, about five to 10 years, before you put it into a definitive feasibility study,” Austin said.

With over 800 hectares of contract area under its Mineral Production Sharing Agreement (MPSA), Macawiwili has been exploring various mineral deposits, including gold and copper, for several decades.