Mining shares lose P6b in 1 day

posted February 16, 2017 at 12:01 am
by  Anna Leah E. Gonzales
PHILEX Mining Corp. said Wednesday that Environment Secretary Regina Lopez’s recent pronouncements have resulted in about a P6.5-billion loss in shareholder value in just a day.

Lopez on Tuesday announced that the government is cancelling 75 Mining Production Sharing Agreements of companies with projects allegedly located in watersheds.

The MPSA of Philex Mining’s wholly-owned subsidiary Silangan Mining Company Inc. covering the Silangan project was included in the list.

“Following the press conference, the ensuing confusion and uncertainty surrounding... Secretary Lopez’s pronouncements has already resulted in significant economic harm to Philex public shareholders, including the Social Security System and its beneficiaries, through a sharp decline in its share price and has endangered the Silangan project, which is nearing its project implementation, by eroding investor confidence in the midst of a worrisome regulatory landscape that appears to disregard due process and interprets applicable laws as it wishes,” Philex Mining said.

The SSS has a 22.43 percent stake in Philex.

Philex said that to date, it has not yet received any cancellation order or any notice of a cancellation from the Department of the Environment and Natural Resources or any other government agency.

Environment Secretary Regina Lopez
The Silangan project is a copper and gold project located in Surigao del Norte in Mindanao with an expected investment opportunity of P40 billion. Silangan Mining is also expected to spend P6 billion over the same period for social development and infrastructure programs that will benefit Mindanao.

“Mindanao is an area where President Rodrigo Duterte has declared his fight against hunger, poverty and underdevelopment. It is expected that, starting 2020, the Silangan project will, for the first 10 years of operation, generate P170 billion in revenues, P31 billion in national and local taxes, and at least 8,000 employment opportunities,” Philex said.

“The project will promote the much-needed development in an area which, in the words of President Duterte, has long been neglected. Silangan Mining secured its MPSA for the Silangan project from the national government only after a thorough review process by all relevant government agencies and the endorsement of the host communities and local government units,” added Philex.

Philex said that contrary to the statements in the press conference, none of the areas covered by the Silangan Mining MPSA is located in a proclaimed watershed forest reserve where mining is prohibited.

“Silangan Mining is therefore confident that its MPSA is valid and can withstand any legal challenge. While the DENR, as regulator, has the right, if not also the duty, to enforce faithfully all mining laws, and to act against erring mining companies, it must do so within the bounds of the Constitutionally-mandated due process procedure,” Philex said.

Aside from Silangan, four tenements of another Philex subsidiary, Philex Gold Philippines Inc. have also been included in the list for MPSA cancellation.

Philex said all these MPSAs have been validly issued and, contrary to the assertions in the press conference, are also not located in proclaimed watershed forest reserves.

“PX and its subsidiaries are willing partners of the Government in protecting the environment, and in its fight against poverty and unemployment, and in upholding the rule of law and supporting due process,” Philex said.

“PX continues to support President Duterte in his drive against illegal and irresponsible mining, and rally behind the President in promoting responsible and community-oriented mining,” it added.

Topics: Secretary Regina Lopez , Philex Mining Corp. , Silangan Mining Company Inc. , Mining Production Sharing Agreements , Mining companies , SSS , DENR
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