--Xstrata's Sagittarius Mines unit gets conditional approval for
Tampakan mine
--Sagittarius: Will review conditions set by environmental
department
--Industry group welcomes approval; says mining investment
needed to create jobs
(Adds comment from industry group, background on mine and mining
investment)
By Cris Larano
MANILA--The Philippines environmental regulator has given a unit
of Xstrata PLC (XTA.LN) conditional approval to develop what will
be Philippines' largest gold and copper mine.
Environmental approval at the $5.9 billion Tampakan mine, which
the company has said will produce around 375,000 tons of copper and
360,000 ounces of gold a year over a 17-year period, has been
complicated by a ban on open-pit mines in South Cotabato province.
The mine, which covers nearly 100 square kilometers, also straddles
Sarangani, Sultan Kudarat and Davao del Sur provinces on the
southern island of Mindanao.
Xstrata Copper subsidiary Sagittarius Mines Inc. will still need
approval from the local government and other state agencies,
Environment and Natural Resources Secretary Ramon Paje said in a
statement.
Sagittarius Mines said Tuesday in a statement that it has
received the permit and is "reviewing the terms and conditions
contained in the document."
Construction at the mine "could potentially commence in 2015,
enabling commercial production in 2019," Sagittarius Mines
President Peter Forrestal said in December.
Sagittarius Mines took control as operator of Tampakan in 2007.
The project is a joint venture among the Tampakan Group, Xstrata
and Australia-listed Indophil Resources NL (IRN.AU). The Tampakan
Group--composed of local businesses--owns 60% of Sagittarius Mines,
with the balance shared by Xstrata and Indophil, which in turn is
partly owned by Philippine conglomerate San Miguel Corp.
(SMC.PH).
The Chamber of Mines of the Philippines, a mining industry
group, welcomed the environmental permit's issuance.
"It's an encouraging sign from the government, which has…[said]
that the Philippines needs at least $3 billion in investments to
create jobs," the chamber said.
The government cut its investment target for mining last year to
$509 million from $2.27 billion due to delays in some projects. The
investment target this year was also reduced, to $718.5 million
from $2 billion previously. The mining industry had pointed to
uncertainty in the government's mining policy, permitting
challenges and a moratorium on the grant of new mining licenses as
reasons for project delays.
Although the Philippines is the world's third-largest nickel
producer and contributes to the global trade in other metals, the
value of mining exports has slipped from more than 20% of the
country's total exports four decades ago to less than 6% in
2011.
Write to Cris Larano at cris.larano@dowjones.com
Subscribe to WSJ: http://online.wsj.com?mod=djnwires