Making Right Moves
Richard Mills, Chairman
Mines Chairman Robert Friedland dismissed previous setbacks suffered in the
Philippine mining industry and chose instead to focus on the country's
"rebirth," when he spoke at the Philippines Mining Conference.
Armed with statistics outlining
the size of the country's mineral reserves (thought to be the world's
fifth-largest), Friedland talked of the need for metals in China.
"The Chinese dragon has a
fire in its belly and the only thing that can quench it is metals," he
said, stressing that the Philippines could help meet that need. Friedland
added that Ivanhoe is heavily vested in the country and "aggressively
pursuing" other ventures.
Friedland supports the recent
Supreme Court ruling that upholds 100% foreign ownership of major Philippine
mining operations (that is, those with a capital cost exceeding US$50
million). The ruling should allow the government to revive a mining sector
that once accounted for close to a quarter of the country's export earnings.
Among the delegates attending
the conference were Wayne Spilsbury, general manager of exploration in the
Asia-Pacific region for Teck Cominco, and Peter Leaman, global assessment
leader with BHP Billiton, both of whom applaud the newly elected
government's commitment to mining.
And yet numerous obstacles to
development exist at the local level. One such obstacle is a law that gives
indigenous people veto rights over new mines on ancestral lands. "But
no one is sure who counts as an indigenous person in the Philippines, or
where their lands lie," said Philip Romualdez, head of a local mining
firm. One company, Lafayette, based in Australia, has been active in the
Philippines for several years, and is
prospering under existing conditions. The company is about half-finished
building its its Rapu
Rapu copper-gold-zinc-silver mine.
Lafayette is spending A$57
million on the project, which is expected to start producing by mid-2005.
The Supreme Court ruling proved good for Lafayette. In the 2-month period
leading up to the announcement, its stock climbed to A20¢ from A12¢.
Canadian junior TVI Pacific is
already operating in the country. Despite its small size, TVI Pacific is
being touted by local government officials as a success story. Philippine
President Gloria Macapagal Arroyo even took time to meet privately with TVI
CEO Clifford James.
BHP Billiton and Anglo-American
have advanced-stage exploration projects in the country also, as do some
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