BHP Billiton assures it is staying in RP

Published by rudy Date posted on January 11, 2009

BHP Billiton Ltd., the world’s biggest mining firm, has assured Philippine mining authorities that it is not pulling out its operations in the country.

Horacio Ramos, director of the Mines and Geosciences Bureau of the Department of Environment and Natural Resources, said BHP has assured them that it is staying put in the country despite the global economic downturn and a lingering dispute with its former local joint venture partner.

Ramos said BHP Billiton is awaiting the decision of an international arbitration body regarding its dispute with Peter Tan over several mining tenements.

BHP Billiton, however, has scaled down its Philippine operations due to the legal dispute with Tan. Last year, it laid off its Manila office staff for its joint venture mining firm Amkor and suspended operations in its mining exploration site in Mati, Davao following its protracted dispute with Tan.

Although Environment Secretary Jose Atienza has personally tried to mediate a settlement between BHP Billiton and Tan, a compromise resolution remains elusive.

“There’s nothing yet,” Ramos admitted in a recent press conference.

The DENR is trying to broker a compromise over the development plans of the Pujada nickel deposit. Tan has rescinded a joint venture agreement with BHP Billiton following allegations the Australia-based miner is dragging its feet on the project, hence costing its Filipino joint venture partners.

A proposed compromise deal would supposedly involve the operation of some mining areas which would  be determined by both parties.

The agreement would allow BHP Billiton to continue its investments in the country, while at the same time addressing the need to provide immediate cash flow for the group of Tan.

BHP Billiton is the world’s largest resource company and its continued presence and investment in the Philippines would attest to the attractiveness of the country as an investment site, Ramos said.

The company is a producer of energy-related products, such as energy coal, oil, gas, liquefied natural gas and uranium. Its customer sector groups are organized into nine business units: petroleum, aluminum, base metals, diamonds and specialty products, stainless steel materials, iron ore, manganese, metallurgical coal and energy coal.

Tan, meanwhile, holds seven mineral production sharing agreements (MPSAs) in various parts of the country.

Tan had been complaining about the slow pace of the joint venture with BHP Billiton, which remains at the exploratory stage  at a time when world mineral prices are peaking.

Tan, who wants BHP Billiton to fasttrack the joint venture and start production, decided to rescind his joint venture contract with the mining firm, with the dispute landing in court. –Marianne V. Go, Philippine Star

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