Glencore Xstrata, Indophil discuss Tampakan joint venture restructure

KORONADAL CITY (MindaNews / 26 May) – Australian firm Indophil Resources NL is in talks with Glencore Xstrata plc for the possible restructuring of the joint venture at the Tampakan project, Southeast Asia’s largest known undeveloped copper-gold reserve, a company executive said

Brian Phillips, Indophil chairman, said during the annual general meeting on May 23 in Australia that the company is involved with several significant events, foremost of which is a discussion with the new merger.

“The most important of these, from an Indophil shareholder perspective, is our discussions with the newly-formed Glencore Xstrata, including considering ways to restructure our joint venture on the Tampakan copper-gold project in the Philippines,” he said in a disclosure to the Australian Stock Exchange.

“In the 21 days since the acquisition of Xstrata was completed, Glencore has demonstrated its willingness to act promptly and decisively. Glencore has a broad portfolio, and a considered but driven agenda,” Phillips added.

Glencore International plc announced on May 2 it has completed the takeover of Xstrata plc to form the GlenCore Xstrata, reportedly making it the world’s fourth-biggest mining company and the world’s biggest commodities trader.

Phillips said that Indophil executives have moved swiftly to engage constructively with Glencore Xstrata.

There is much to be done, and we are approaching the next chapter in Tampakan’s development with an eye on the risk and with energy and enthusiasm, he noted.

Xstrata, through its wholly owned Xstrata Copper, owns 62.5 percent of the 40 percent controlling equity at Sagittarius Mines, Inc. (SMI), developer of the Tampakan project.

Indophil owns the rest or 37.5 percent of the controlling equity. It is Indophil’s flagship asset in its portfolio.

The Tampakan project straddles the towns of Tampakan in South Cotabato, Columbio in Sultan Kudarat, Kiblawan in Davao del Sur and Malungon in Sarangani.

The Department of Environment and Natural Resources had issued an environmental compliance certificate to the Tampakan project last February, after rejecting it twice last year on the ground of the open-pit ban imposed by the South Cotabato provincial government.

In December last year, SMI announced that it was moving the start of commercial operation from 2016 to 2019. Among the major challenges the company cited facing its operation was the open-pit ban in South Cotabato.

Phillips expressed confidence the open-pit ban of South Cotabato would be “overthrown,” citing President Benino Aquino III’s signing of Executive Order 79 or the new mining policy in July last year.

But South Cotabato Second District Rep. Daisy Avance Fuentes, who was elected governor in the May 13 elections, had vowed to implement the ban on open-pit mining in the province.

It was Fuentes who signed the Environment Code that prohibits open-pit mining before stepping down as governor in 2010 after completing the three-term limit for local elected positions.

Honoring the ban on open-pit was among Fuentes’ major platforms during the campaign season.