DENR to revise mineral investment targets

The Department of Environment and Natural Resources (DENR) is set to review and revise its mineral investment targets in the face of the global economic slowdown.

The Mines and Geosciences Bureau (MGB) of the DENR is reviewing its mining investment target in the face of at least two companies delaying their investment plans.

MGB director Horace Ramos confirmed to The STAR that a review is indeed being undertaken.

Ramos expressed confidence that the targets would still be met, but admitted that the timetable may be delayed.

However, mining industry sources are divided about how long the current global economic slump would affect the attainment of the investment targets.

Industry sources acknowledged that once the global economy revives, industries would demand mineral resources.

Unfortunately, projecting how long the global economic slump would last, industry sources admit is anybody’s guess.

Most are projecting at least two years before the global economy stabilizes.

Two companies, Oceana Gold and Intex Resources, have already announced delays in their investments.

Oceana Gold is looking for a new investor, while Intex is delaying to next year the completion of its feasibility study.

The MGB, however, is still optimistic that mining firms that have already secured their financing requirements prior to the financial meltdown are likely to maintain their investment schedule and would thus not negatively impact on the overall investment target.

These companies include Atlas Consolidated subsidiary Carmen Coppers Corp., Filminera Resources and Philsaga Mining.

On the other hand, other mining firms that are still in the exploratory stage and have not secured their financing, the MGB agreed, may slowdown their operations.

The DENR was hoping that the Philippines would attain the distinction of being a “mining country” as early as 2009.

The DENR had projected that investment inflows up to 2011 would hit $10.467 billion.

Based on projections of the MGB, this year’s projected investment inflow would reach $892 million coming from at least seven mining firms.

The additional investments this year would be for construction and development with actual production expected the following year.

Thus, by 2009, total mineral sales value by the seven priority mineral development projects was projected to reach $26.805 billion, which would be equivalent to about 6.15 percent of the country’s total exports.

Based on the World Bank’s definition of a “mining country”, such a status is attained when a country’s total mineral export is equivalent to at least six percent of its total exports.

The projected investment inflow in 2009 of $1.845 billion would be more than double this year’s $892 million.

Thus, by 2010, sales value alone from the same seven first tier priority mineral development projects is calculated to increase to $33.844 billion.

The seven first tier priority mining projects are those of Atlas Consolidated and Mining Corp. subsidiary Carmen Copper Corp.’s Carmen (Toledo) copper project; Oceana Gold Phils., Inc.’s Didipio copper-gold project; Coral Bay Mining Corp.’s Palawan line 2 nickel project; Filminera Resources Corp.’s Masbate gold project; the Platinum Group of Metals Corp.’s Illigan and Manticao ferronickel smelter plants and the Philsaga Mining Corp.’s gold project.

The projected doubling of inflow of foreign investments in 2010 of $4.141 billion would then translate to an even higher sales out by 2011.

However, only projecting from the total sales value of the seven priority mining projects, by 2011 the sales would amount to $30.874 billion.

Projected investment inflows, however, may slow down by 2011 to just $2.21 billion, but projected total sales value by 2012 and 2013 could still hit $31. 05 billion, annually.–Marianne V. Go, Philippine Star