Philex+Dossier+2nd+Edition+by+art+boquiren+for+atm+and+lg

8/7/2019 Philex+Dossier+2nd+Edition+by+art+boquiren+for+atm+and+lg

http://slidepdf.com/reader/full/philexdossier2ndeditionbyartboquirenforatmandlg 1/51

DOSSIER ONPHILEX MINESFocus on Benguet operations

By Arturo Boquiren

An implementation of a cooperation betweenLinis Gobyerno and Alyansa Tigil Mina

Views expressed in this documentation do not necessarily reflectthe views of Alyansa Tigil Mina nor the Linis Gobyerno

May 2009



ii

Table of Content

Section Page

I. Introduction 1

II. History of operation 3

III. Philex Mining Corporation today 6

IV. Geology, reserves, and mining method/processing

A. Geology 16

B. Reserves 19

C. Mining method/processing 20

V. Wastes and risks to the environment

A. Overview on Philex operation 30

B. Wastes, tailings ponds, and route of wastes 32

C. Risks to the environment 39

VI. Conclusions and recommendations 43

Bibliography 45



iii

LIST OF TABLES

Number Title Page

1Philex tailings pond, expected useful life, area, capacity, andstatus

36

2DENR-EMB description on water quality of rivers threatenedby Philex

39

LIST OF FIGURES

Number Title Page

1 Incorporators and ownership of Philex Mining Corporation 32 Production in 1958 started at 800 tons per day 43 Philex Pacdal area in 1958 44 311 million tons milled in 48 years by Philex-Pacdal 55 Tax paid by Philex: P9.7 billion in 50 years, P485 million in 2006 56 Corporate structure of Philex Mining Corporation 77 Ownership of the Philex Mining Corporation over subsidiaries 88 Shareholders of the Philex Mining Corporation 99 Directors, officers, and staff of Philex Mining Corporation 1010 Process flowsheet of milling and market outlet 1111 Map showing land area covered by Philex mine operations 1212 Map showing the MPSA and APSA of Philex mine operations 1213 Assets and liabilities profile 1314 Income profile 1415 Taxes paid 1991-2006: P1.08 billion 1516 Site of Philex mining operations and fault lines 1617 Philex Mining Corporation illustration of Philex ore body 1718 Vertical section of Sto. Tomas II ore body and milling plant 1819 Location of Philex ore body 1820 Reserves according to Philex mines 1921 Characteristic of Philex ore body: massive 21

22 Overview on mining and milling method at Philex-Pacdal 2123 Philex Mining method 1958-1963: open pit mining 2224 Philex mining 1963-1996: block caving-slusher method 2225 Philex mining 1996-present: block caving with load-haul-dump 23



iv

Number Title Page

26 Overview on Philex mine development 2327 Horizontal driving in Philex mine development 2428 Vertical driving in Philex mine development 2429 Installing rock support in Philex mine development 2530 Drilling of fan holes in Philex mine development 2531 Drawpoints for ore in mine development 2632 Overview on block-caving in mine operations 2633 Ore extraction method 2734 Scooping, loading, and dumping of ore 2735 Subsidence at the ore body in mine operation 2836 Backfilling operations on subsidence 28

37 Backfilling above active mining area 2938 Milling flowsheet and transport to Poro Point for Japan or Leyte 2939 Philex Mining Corporation ore body and mill 3040 Close-up on Philiex Mining Corporation ore body and mill 3141 Map on Philex ore body, mill, residential areas, and tailing ponds 32

42Philex open pit mine, tailing ponds, and nearby areas on GoogleEarth

33

43 Tailing pond 1 undergoing rehabilitation as described by Philex 3344 Philex open pit/ore body and tailings ponds 1, 2, and 3 34

45Philex tailing ponds 1, 2, and 3 and link to body of water (Agno

River)

34

46 Philex tailings pond 1 then and now 3547 2006 vegetation profile of decommissioned tailings pond 1 3548 Mine waste management in tailings pond 3 3749 Tailings pond 3 is reported by Philex as its “active tailings pond” 3850 Decommissioned Philex tailings pond 1and fishponds 4051 Tilapia fish pond terraces at Omistic 41

52Philex Mining Corporation and company perception of its ownimpact

42

53 A view on the Philex facilities and host community 42



v

ABSTRACT

Philex Mining Corporation was established in Benguet in 1955 but mining operationsstarted in 1958. As of 2009, it has been in Benguet for more than 51 years. Mineral productionstarted at 800 tons per day although mill capacity has been at 2,000 tons per day. Philex MiningCorporation 2008 income from gold, copper, and silver was around P 9.7 billion (P5.4b from gold,P4.3b from copper, and P85.1b from silver). The total hectares of land utilized to generate theincome were 39,440 hectares (covering 14,256 in Benguet and 24,184 hectares in Surigao). Thisimplies that Philex mining yields only P246,174 of revenues per hectare.

Philex Mines has mined and milled a total of 293.6 million tons of ore over 47 years, from1958 to 2005. The Philex production generated a total of US2.6 billion through exports. By 31December 2006, total ore milled reached 311 million metric tons and generated US$2.7 billionthrough exports. In contrast, Department of Science and Technology-Philippine Council forAgriculture, Forestry and Natural Resources Research and Development (DOST-PCARRD)sources say that gross income from saluyot production is higher at P640,000 per hectare.

During the 47 years, the company produced 3.248 million dry metric tons of concentrate

consisting of 824 million kilograms of copper, 146.9 million kilogram of gold, and 163 millionkilograms of silver.

Based on geology, product, and production process, the following are some of theenvironmental risks and issues in Philex mine operations:

1. Environmental impact and geohazard risks posed by mine ore body2. Environmental impact and geohazard risks posed by tailings pond 1, 2, and 33. Adequacy of rehabilitation done for tailings pond 14. Existence of and adequacy of plans and resources for post-mining management of

tailings ponds 2 and 35. Risks posed by possible effluents from the Banget milling plant

6. Impact of Philex operations on the Albian Creek, Sal-angan Creek, Balog River, andAgno River

7. Details on and soundness of the Philex mine rehab plan given Philex’s plan exit fromBenguet in 2012

8. Adequacy of the Philex rehabilitation fund given its level at P26.639 million as of 31December 2009

Action on the eight (8) concerns and issues identified above is urgent given thepossibility that Philex may cease operating in Benguet or withdraw from some parts of Benguetin 2012. Based on the stockholder profile of Philex Mining Corporation, the following should beconsidered as possible pressure points or allies once Philex reneges or fails on its claim ofcommitment to “corporate responsibilities”, covering accountabilities related to the environment:

1. Social Security System (owner of a significant share of Philex)2. The Roman Catholic Archbishop of Manila

Based on supply and market structure, advocacy work can be undertaken in Canada,United Kingdom, The Netherlands, and Japan.

artboquiren may 2009



vi

Preface to the 2nd Edition

The first edition of this work was finished April 2009. At that time, thereport of the Philex Mining Corporation to the Securities and Exchange

Commission was not available to the researcher. This edition factors in thereport of the company to the Commission as well as improves the writing styleand content of the first edition.

The second edition failed to confirm the role of some banks in Philexoperations and so adjustments were made for this. There will be succeedingeditions of this work and works are ongoing to produce a sequel.

This edition as well as the first was unable to produce a deeper analysis ofthe environmental, social, and economic of Philex operations because of fundingconstraints---unfortunately notwithstanding the existence of institutions that

have the resources and mandate to support studies related to the environment.Hopefully, one of them can support the production of a sequel as soon aspossible especially because of the urgency of the concerns involved.

The author thanks the Alyansa Tigil Mina and the Linis Gobyerno formaking the study possible.



Dossier on Philex Mining in Benguet

I. Introduction

The aim of this work is to establish a dossier on Philex mining operation in

Benguet. A dossier pertains to a database or sourcebook/source website/webpage that canbe updated or on which additional data can be added. The dossier will focus on the

environmental, economic, and social impact of Philex Mining Corporation.

The documentation will provide evidence whether or not large-scale mining is a

reliable engine of development. The dossier will be extremely useful for formulating

advocacy/pressure tactics and even a legal case against Philex Mines, whenever warranted especially once the company leaves Benguet or portions of Benguet.

Philex is the largest mining firm in the country and an International StandardsOrganization (ISO)-certified firm. If we are able to provide evidence that Philex did not

significantly improve the quality of life in Benguet and show that even an ISO-certifiedfirm degrades the environment in gold/copper mining, then we can argue that the smaller

mining firms and those without ISO-certification will probably not do any better.

We can also provide evidence that an ISO-certification will not guarantee a so-

called responsible mining, assuming that responsible mining does exist.

The research results will also enable civil society groups like the South Cotabato

groups anticipate the likely impact of Sagitarius Mines when once it pursues mining inTampakan, South Cotabato. Sagitarius Mines plans to produce almost ten times the

annual output of Philex Mines in Benguet.

Philex Mines in Benguet has required 3 tailing ponds, a large tract of land for milling and company operations, and a San Roque dam. Other than this, the site of the

ore body itself is probably a ground zero for ecological disaster. Thus, most likely,

Tampakan mining in South Cotabato would have an environmental impact ten times of Philex mines. Therefore, data from this research are also urgent for the advocacy work of

groups seeking an environment-friendly path to development in South Cotabato and

elsewhere.

Research problem. The research problem that will be continually addressed by

the dossier are as follows:

What has been its impact to the host communities? Did large-scale mining

succeed in providing a good quality of life for its workers and host communities? What

does evidence say? What are their impacts to workers? What are their impacts to its hostcommunities? What are their impacts to the environment?

Being the largest mining company and being the company that is operated alonginternational standards, how can we compare the quality of life provided by Philex

ATM/LGI a. boquiren May 2009 arturoboqui [email protected]

1



Mining Company to its workers and host communities? Would other economic endeavors

have a better potential in providing a better quality of life for its workers and host

communities? What does evidence say on the matter?

What are the prospects for a post-Philex economy when Philex decides to leave

the community around 2012 or later? At the same time, what are accountabilities of Philex to its host communities? Is the allocation for rehabilitation adequate given its

accountabilities?

Meanwhile, what is the firm, asset, liability, market, financial, and supply-chain

structure of Philex? What opportunities do the structure presents for advocacy and

pressure tactics of environmental-protection advocacy groups?

Scope and purpose of this initial edition. Although the research problem

described earlier is the one that will be addressed by this dossier, information will have to

be built up over time. The building up of dossier will be done through voluntary initiative

as well as through research funded by donors.

Funding for research will allow a quick address of the concerns of this dossier.Further, it will allow an address of the research problem at a deeper level of inquiry as

resources will be available for review of literature, interviews, key informant interviews,

focus group discussion, data search, review of documents, and release time for an in-

depth analysis of data.

The immediate concern of this edition is to identify the environmental risks posed

by the mining operation of Philex based on a review of its mining operations as well asdata available based on company documents and sources of information.

Further, this edition seeks to apply the methodology of SOMO. The SOMOmethodology makes intensive use of internet sources to identify firm structure, market,

and firm financial condition for the purpose of identifying the appropriate pressure points

for lobby work.

In addition to the internet sources, however, maximized the use of company

information as well as information that can be gathered from company reports to the

Securities and Exchange Commission.

Of course, this edition will be updated and enriched through time. When possible,

resources will be acquired so research can be made in-depth especially given PhilexMining Corporation possible exit in 2012.

ATM/LGI a. boquiren May 2009 arturoboqui [email protected]

2



II. History of operation

Philex Mining Corporation was incorporated in 1955. It is one of therelatively new large-scale mining companies in Benguet. Lepanto MiningCorporation operating in the Municipality of Mankayan, for example, has beenin Benguet since 1936 while Benguet Corporation (known as BenguetConsolidated Mining Company in 1906 and Benguet Gold Mines in 1903) hasbeen in Benguet for more than 100 years.

Figure 1. Incorporation and ownership of Philex Mining Corporation(Source: PMC 2007a)1

From incorporation of Philex Mining Corporation in 1955, mill and mineconstruction commenced. Mineral production started in 1958 at 800 tons per day.However, mill capacity was at 2,000 tons per day. Company data reported to theSecurities and Exchange Commission say that ore extracted and processed from1958 was 332.2 million tons by 2008 and produced 897.4 million kilograms ofcopper, 162.2 million grams of gold, and 177.9 million grams of silver.

Company data say that, as of 31 December 2006, total ore milled reached311 million metric tons and generated US$2.7 billion through exports. A 26February 2005 report of The SunsStar says that from a deposit of 18 million tonsand after mine and mill expansion, Philex Mines mined and milled a total of

293.6 million tons of ore over 47 years, from 1958 to 2005. Philex generated atotal of US2.6 billion through exports during the period. Further, during the 47years, SunStar also say that the company produced 3.248 million dry metric tonsof concentrate consisting of 824 million kilograms of copper, 146.9 millionkilogram of gold, and 163 million kilograms of silver.

1 PMC is Philex Mining Corporation.

ATM/LGI a. boquiren May 2009 arturoboq [email protected]

3



The main site of Philex mining operations, from its establishment untiltoday, is the Sto. Tomas II ore body in Pacdal, Tuba, Benguet. Pacdal Mine, as themining site is also known, used to be a completely logged-out old sawmill.

Figure 2. Production in 1958 started at 800 tons per day (Source: PMC 2007b)

Figure 3. Philex Pacdal area In 1958 (Source: PMC 2007b)


4



Figure 4. 311 million tons milled in 48 years by Philex-Pacdal

(Source: PMC 2007b)

Figure 5. Tax paid by Philex: P9.7 billion in 50 years, P485 million in 2006

(Source: PMC 2007b)

Philex Mines is proud to be the first mining company in the Philippines tohave earned the International Standard Organization (ISO) 14001 certification,making Philex the first Philippine mining company to earn the certification.Philex claims to have successfully reforested watershed, open, denuded, andpoorly stacked forestlands with an area of 1,540 hectares as of 2005.


5



ATM/LGI a. boquiren May 2009 arturoboquir [email protected]

6

III . Philex Mining Company today

A. Corporate Structure

According to the 2009 report of independent auditors (SGV & Co/Ernst &Young) and other documents of the Philex Mining Corporation:

Philex Mining Corporation (see www.philexmining.com.ph) wasincorporated in the Philippines in 1958. It is a parent company with thefollowing direct subsidiaries (the parent company and its direct subsidiaryare oftentimes referred to as the Philex Group):1) Philex Gold Philippines, Inc.: PGPI is an 81%-owned subsidiary of the

parent company through holding companies and incorporated in thePhilippines. However, PGPI was incorporated under the laws of Alberta,Canada and is primarily engaged in the exploration and development of

oil, gas, and minerals.2) Brixton Energy & Mining Corporation: BEMC is a wholly owned

subsidiary of the parent company and incorporated in the Philippines3) Philex Petroleum Corporation: Philex Petroleum is a 51%-owned

subsidiary of the parent company and was incorporated in thePhilippines

4) FECR (formerly Forum Energy Corporation, see www.fecresources.comand www.sedar.com): FECR is a 50.67%-owned subsidiary of the parentcompany and incorporated under the laws of Alberta, Canada.

The parent company or Philex Mining Corporation, Philex Gold

Philippines, Inc. (PGPI) and its subsidiaries, and Brixton Energy & MiningCorporation are primarily in large-scale exploration, development, andutilization of mineral resources.

The parent company (Philex Mining Corporation) operates the Padcal Minein Benguet. Philex Mining Corporation and subsidiaries derived theirincome mainly from the Padcal Mine. Income from petroleum operations andother sources are insignificant to Philex Mining Company and subsidiaries asof March 2009. Padcal Mine is on its 51st year of operation producing copper,gold, and silver as its principal products.

PGPI operated the Bulawan Mine in Negros Occidental until the second

quarter of 2002. PGPI appears to have its own subsidiaries and this is asubject for further inquiry. PGPI has a number of mineral propertiesthroughout the Philippines at various stages of exploration. Its focus since2001, however, has been on its “North property” where the Boyongandeposit, a major copper-gold porphyry in Surigao del Norte, was discoveredin August 2000 through a joint venture with Anglo American ExplorationPhilippines B.V. (Anglo). PGPI owns the Boyongan deposit.

BEMC has a coal property under pre-development in Zamboanga del Norte.




7

Philex Petroleum Corporation and FECR are engaged in oil and gasoperation and exploration activities. Both participate in oil and gasproduction and exploration activities through investee companies.

Figure 6. Corporate structure of Phil ex Mining Corporation(Source: www.philexmining.com.ph, April 2009)

In turn, the subsidiary companies of Philex Mining Company acquired the

following companies as their subsidiaries:

FECR owns 29.78% of Forum Energy Plc or FEP (FEP can be searched inGoogle Finance and http://investing.businessweek.com. FEP is a UnitedKingdom company incorporated in April 2005 through the consolidation ofthe Philippine assets of Forum Energy Corporation and Sterling Energy Plc(“SEY”) of the UK. FEP has just closed a US$6.2 million pre-IPO financingand a US$19.35 million IPO financing and is listed on the AIM market of theLondon stock exchange. FEP has a portfolio of oil and gas explorationprojects in the Philippines. The portfolio includes contracts with existinginfrastructure, production, and proven hydrocarbon potential. FEP also holdscoal operation contracts in Central and Southern Cebu.

Lascogon Mining Corporation (LMC) was incorporated in 2005 to engage inthe exploration, development, and utilization of mineral resources.

Philippine Gold Mining Company B.V. (PGMC-BV): incorporated inNetherlands. This company has been the intermediary holding company ofPhilex Gold Inc (source: page 5 of the SGV & Co/Ernst and YoungIndependent Auditors Report to stockholders).




8

The other subsidiaries of Philex Mining Corporation are: Philex Land, Inc. (PLI): engaged in the business of owning, using,

developing, subdividing, selling, exchanging, leasing, and holding real estateof all kinds covering buildings, houses, apartments, and other structure

Fidelity Stock Transfer, Inc. (FSTI): agency firm for stock transfers. Philex Insurance Agency, Inc. (PIAI): general agent for domestic and foreign

companies in the non-life insurance business. However, this company wasreported to be dormant.

In its report to the stockholders of Philex Mining Corporation (the report wasalso forwarded to the Securities and Exchange Commission in 2009), SGV & Coand Ernst and Young in early 2009 reported that the following constitutes theownership of firms of the Philex group:

Figure 7. Ownership of the Philex Mining Corporation over subsidiaries(for meaning of the acronyms, see 3-page discussion immediately before the table)

B. Shareholders and management

The April 2009 Philex Mining Corporation’s report to the Securities andExchange Commission of the Philippines indicates that the second largest ownerof Philex is the Social Security System (SSS) with 20.27% share. According to thesame document, there are 46,578 stockholders of Philex Mining Corporation, in

which 35.64% of the outstanding shares are owned by foreign nationals andinstitutions.

As indicated in Figure 8, some shareholders utilize PCD nominees (ornominees of the Philippine Central Depository system), but prerogatives remainin the shareholder and not with the PCD nominee. SSS ownership in PhilexMining Corporation can be higher because of its participation in the PCD. The




9

other participants in the PCD are the Asia Link B.V. (20.063%) and the HongKong and Shanghai Banking Corporation, Ltd. (8.716%).

Figure 8. Shareholders of the Philex Mining Corporation in 2008(Source: PMC Report to the Securities and Exchange Commission, April 2009)

The officers and directors leading the company Walter Brown, AlbertAwad, Thelmo Cunanan, Eulalio Austin, Renato Migrito, Guadaflor Malonzo,and the rest (see Figure 9 next page) are believed to collectively hold no morethan 2% of the company. However, their collective control over the company canbe higher because only 82.32% of Philex has clear ownership and the rest of thevoting rights can be assigned to the board via a proxy assignment.

Walter H. Brown, in his late 60s, Filipino citizen is Board Chairman andChief Executive Officer of Philex since 2004. He was an officer of Philex since2003. He is also the Chairman of PGI and PGPI. Eulalio B. Austin, in his late 40s,has been a leading officer of Philex since 2004 and has been in the Philex

management since 1996. In May 2009, Philex revealed that Romulo Neri (Filipinocitizen), Robert Nicholson (English citizen), Roberto Ongpin (Filipino citizen),and Manuel Pangilinan (Filipino citizen) joined the PMC Board of Directors.




10

Figure 9. Directors, officers, and staff of Philex Mining Corporation(Source: www.philexmining.com.ph, accessed April 2009)

C. Market and Suppliers

Philex procure some of it its supplies through its host communitiesHowever, according to www.mining-technology.com, Philex secures a large partof its supply needs from the Crushing and Mining Equipment PTY Limited of

Perth, Sydney, and Brisbane of Australia.

The Philex produce from its Benguet operation are copper concentratesthat contain copper, gold, and silver. The copper concentrates are smelted byother companies. In contrast, however, the Bulawan gold mine produce bullionscontaining gold and silver that are refined either by the Bangko Sentral ngPilipinas Mint and Gold Refinery or sent by freight and refined by JohnsonMatthey Plc of England.

Figure 10 of the next page indicates that Philex produce from the Benguetoperation are shipped to Japan or Leyte. According to the

www.tradingmarket.com in April 2009, Philex primarily produces copperconcentrates (containing copper, gold, and silver) that are transported via seafreight and smelted in Kyushu Island, Japan, in the Saganoseki smelter of PanPacific Copper Co., Ltd. The latter is a joint venture between Nippon Mining Co.Ltd. and Mitsui Mining and Smelting Co. Ltd.




11

A part of the Philex produce is shipped to L.D. Metals, Ltd., a firmregistered in the United Kingdom under registration number 04382295,Companies House in 2002 (see www.ukdata.com/numbers/04382295.html).

Figure 10. Process flowsheet of milling and market outlet (Source: PMC 2007b)

Philex ships a portion of its copper concentrates to the PhilippineAssociated Smelter and Refinery (PASAR). PASAR operates a copper smeltingand refining company in Isabel, Leyte Island, Leyte Province. According to the

Association for Mineral Economics (see www.ame.com.au), PASAR is owned byGlencore and International Finance Corporation (IFC). Glencore is a Swisscommodities firm while IFC is an arm of the World Bank group. Internet sourcessay that foreign sales from copper concentrates from the Benguet operation aredivided almost on a 50-50 basis between Japan and England.

D. Offices, facilities, tenement area, and land utilization

Philex maintains its head office at:

Philex Building27 Brixton Street, Pasig City, Philippines

The other contact details of the company are

Email: [email protected]: www.philexmining.com.ph




12

Figure 11. Map showing land area covered by Philex mine operations (Source: PMC 2007a)

Philex mining covers a total tenement area of 14,256 hectare. Around 7,776hectares are covered by a mineral production sharing agreement.

Figure 12. Map showing the MPSA and APSA of Philex mine operations (Source: PMC 2007c)

The other facilities of Philex Mining Corporation are the milling and minesite in Padcal, Camp 3, Tuba, Benguet Province and the tailing ponds in Itogon,Benguet. Of course, it has facilities in Poro Point, San Fernando, La Union.




13

Meanwhile, Figure 12 of the earlier page indicate that the mining contractscovering tenements occupied by Philex that enable Philex to pursue its miningoperations are as follows:

1. Mineral Production Sharing Agreement (MPSA)-156-2000-CAR

2. Mineral Production Sharing Agreement (MPSA)-157-2000-CAR3. Application for Production Sharing Agreement (APSA) 684. Application for Production Sharing Agreement (APSA) 29

E. Assets and liabilities profile

Figure 13. Assets and liabilities profile(Source: SGV& Co/Ernst & Young 2009 independent auditor’s report)

Figure 13 indicates that a part of the assets of Philex Mining Corporationconsist of investments in shares of stocks (P260.28 million) and available-for-sale(AFS) financial assets (P378.8 million). The two have a total of P639.08 million orabout 3 % of the total assets of the company.

Only P26.6 million is being allocated by Philex Mines for minerehabilitation.




14

F. Income profile

Figure 14. Income profile(Source: SGV& Co/Ernst & Young 2009 independent auditor’s report)

Figure 14 indicate that the total 2008 income from gold, copper, and silverof Philex Mining Corporation is around P 9.7 billion (around P5.4b from gold,P4.3b from copper, and P85.1b from silver). The total hectares of land utilized to

generate the income is 39,440 hectares (covering 14,256 in Benguet and 24,184hectares in Surigao). This implies that Philex mining yields only P246,174 ofrevenues per hectare.

In contrast, Department of Science and Technology-Philippine Council forAgriculture, Forestry and Natural Resources Reserarch and Development(DOST-PCARRD, 20 March 2009) sources say (see http://blog.agriculture.ph)




15

that even saluyot production can beat the gross income realized from Philexmining at P640,000 per hectare.

G. Taxes and LGU dependence

Figure 15. Taxes paid 1991-2006: P1.08 bi llion (Source: PMC 2007b)

Figure 15 above indicates that total taxes paid by Philex mines to thegovernment in 16 years reached P1.08 billion or about P68 annually.Nevertheless, the data on Figure 14 page 14 of the earlier page indicate themineral product taxes, royalties, and income taxes are around only 11% of thegross income from mining.



IV. Geology, reserves, and mining method/processing

A. Geology

The mountain ranges of Northern Luzon, of which the site of Philexmining operation is part, belongs to a volcanic arc terrain. Gold and coppermineralization is often associated with volcanic rocks as well as with faults in theearth’s crust. In fact, the location of the ore body that is the main subject ofmining operations by Philex is actually crissed-crossed by fault lines. The mostnotable of the fault lines are the Albian and Sta. Fe faults.

Thus, it is not be surprising for Philex gold and/or copper production tobe associated with geo-hazard risks vis-à-vis volcanic or earthquake activity.

Figure 16. Site of Philex mining operations and fault lines (Source: PMC 2006c)

ATI/LGI a. boquiren May 2009 ar turoboquiren@ yahoo.com

16



Figure 14 below gives us a close-up of the Sto. Tomas Ore body that is themain site of Philex mining operation.

Figure 17. Philex Mining company illustration of Phlox ore body: Sto. Tomas orebody is directly along the Albian and Sta. Fe faults (Source: PMC 2006c)

As indicated by the figure above, the Sto. Tomas Ore Body of Philex Mineslies directly along the path of the Albian and Sta. Fe fault lines. A sharpmovement along the fault line can result to a geological disaster.

In the future, we will analyze Figure 14 further as we compare the mapwith ground data. We will also analyze deeper all the figures in this work as theyare probably indicative of the risks to the environment posed by the Philexmining operations. The figures in this work probably contain information morethan what are obvious.

Figure 18 on the next page indicate the proximity of the Philex millingplant to the Sto. Tomas II ore body. The ore body is actually the site of the oldopen pit mining of Philex. Underneath the site of the old open pit mine, Philexunderground mining continues.


17

Philex Ore Body

(Sto. Tomas II)



Figure 18. Vertical section of Sto. Tomas II ore body and milling plant: blue blocks aremined-out, red blocks are producing, and green block is virgin (Source: PMC 2006c)

Figure 19. Location of Philex ore body: Philex Mines’ PowerPoint (Source: PMC 2006c) abovesuggest s that the Sto. Tomas ore body is approximately at N16º16’ E120º32’. However, as

discussed in Chapter 5, the ore body is likely at 16º15’45.62” North 120º37’18.87” East


18



B. Reserves

Figure 20. Reserves according to Philex Mines (Source: PMC 2007b)

Figure 20 above comes from the public PowerPoint presentations of PhilexMines. The figure claims that Philex will be operating only up to 2012 when nonew ore discoveries are made. This schedule coincide with the maximum minetailing pond life of 20 years of Philex tailings pond 3. Thus, if the company shutsdown by 2012, it is important to find out how the 3 tailing ponds (1, 2, and 3) willbe managed, especially tailings pond 2 and 3. Tailings pond 1 must also beinspected for any instability.


19

PHILEX MINING CORPORATIONSTO. TOMAS II OREBODYPadcal, Camp 3, Tuba, BenguetYear Discovered : 1955Year Production : 1958

Initial Ore Reserve 18.0MT @0.90%Cu; 0.98gAu/t

Initial Production 800TPD @0.80%Cu; 1.0gAu/t

Total Geologic Resource since start:

368 Million DMT @0.30%Cu; 0.60 gAu/t

Geologic ResourceRemaining as of January 1, 2006

95.8 Million DMT @ 0.28%Cu; 0.68gAu/t

Production History (from start to December 31, 2005)Tons Milled : 302.2 M DMT

%Cu : 0.33gAu/t : 0.56

Copper Conc. Produced : 3.324 M DMTCopper Kgs. Produced : 840.6 M

Gold Gms. Produced : 149.5 MSilver Gms. Produced : 165.9 M



C. Mining method/processing

Figure 21 on the next page that comes from a set of Philex PowerPointSlides indicates a bias of the company for open pit mining. An educational and

research site on precious metals, www.aboutpreciousmetals.com, defines openpit mining as a method of extraction done by digging a large hole in the groundand removing the ore. According to the educational site, the walls of the mineare dug out in steps or benches to provide a stable structure to the pit walls andallow maneuver for earth moving machinery as the pit is expanded. The site alsosays that before ores can be removed, they need to be broken up into manageablepieces by drilling holes into rocks and filling them up with explosives.

On the other hand, according to http://technology.infomine.com (April2009), block-caving extends open pit mining in the underground through caving

and extraction of massive volumes of rock that translate into surface depressions.In block caving, underground tunnels are constructed towards undergroundhaul points where the rocks above are broken down and dropped to haul pointsbelow. From the haul points, the ore are transported into the milling plant.Figure 24 and 25 (pages 22-23) illustrate block caving methods.

As admitted by Philex Mining Company through its PowerPoint Slides,open pit mining was the method of mining used by Philex Mining Corporationfrom 1958 to 1963 when ore was extracted at the rate of 800 million metric ton perday (MTPD).

In 1963-1996, Philex mining used slusher-scraper machines in their block-caving operations and so the mining method is called blocking caving-slusher

method today. This is illustrated by Figure 24 on page 22.

Finally, beginning 1996, the block caving system of mine operation usedload-haul-dump units and the mining methodology is called today as blockcaving-load haul dump or LHD. This is illustrated in Figure 25 on page 23.LHD refers to Load-Haul-Dump and is one variation of the block-caving miningmethod. In particular, LHD refers to the loading, hauling, and transport of theore via dump trucks or transport vehicles.

According to the World Gold Council (www.trustingold.com, 2009)composed of gold miners around world, block-caving is the one with the lowestcost of all mining methods except when compared to open pit mining. CharlesKubach (www.mine-engineer.com, 2009), world renowned mining engineer,considers open pit mining as the mining method with the lowest cost.


20



Thus, Figure 22 (page 21) basically summarizes that the main products ofPhilex operations are gold, copper, and silver. The mining method used is blockcaving-load/haul/dump while the milling method used to turn ore into copperconcentrates is flotation.

Data are yet unavailable on how Philex Mines dispose of its gold andsilver as well as its other by-products: magnesium, iron, bismuth, manganese,nickel, cobalt, cadmium, chromium, mercury, platinum, and palladium.

Figure 21. Characteristics of Philex ore body: massive (Source: PMC 2006c)

Figure 22. Overview on mining and milling method at Philex-Pacdal (Source: 2007a)


21



Figure 23. Philex mining method 1958-1963: open pit mining (Source: PMC 2006a)

Figure 24. Philex mining 1963-1996: block caving-slusher method (Source: PMC 2006a)


22



Figure 25. Philex mining 1996-present: block caving with load-haul-dump (Source: PMC 2006a)

SunStar (2 February 2005) describes the LHD or load, haul, anddump of the Philex mining method this way: ore is drawn by the load-haul-dump or LHD units then transported to the mill through cable beltconveyor system, 2.7 kilometers away from the ore body. SunStar reportsfurther that the milling process of Banguet Concentrator utilizes threestages of crushing that creates a final product of copper concentratedescribed as “73% minus 10 mm.”

Developing mines from which ores can be gathered involves thefollowing processes: horizontal and vertical driving, installation of rocksupport, drilling of fanholes, excavation of trenches, and undercutting.Figures 26-31 on pages 23-26 are illustrative.

Figure 26. Overview on Philex mine development (Source: PMC 2006a)


23



Figure 27. Horizontal driving in Philex mine development (Source: PMC 2006a)

Figure 28. Vertical driving in Philex mine development (Source: PMC 2006a)


24



Figure 29. Installing rock support in Philex mine development (Source: PMC 2006a)

Figure 30. Drilling of fan holes in Philex mine development (Source: PMC 2006a)


25



Figure 31. Drawpoints for ore in mine development (Source: PMC 2006a)

After a mine has been developed, production commences.Production involves scooping, breaking rocks to get the ore, handling theore, crushing the ore, and conveying the ore. Figures 32-34 of pages 23-27are illustrative.

Figure 32. Overview on block-caving in mine operations (Source: PMC 2006a)


26



Figure 33. Ore extraction method (Source: PMC 2006a)

Figure 34. Scooping, loading, and dumping of ore (Source: PMC 2006a)


27



Figure 35. Subsidence at the ore body in mine operation (Source: PMC 2006a)

Figure 36. Backfilling operations on subsidence (Source: PMC 2006a)

As discussed earlier, Figure 17 of page 17 indicate that the Sto.Tomas II ore body is along the Albian and Sta. Fe faults. Based on Figures35 and 36 above and Figure 37 of page 29, it is clear that the block caving-

LHD mining method currently used by Philex mines involve thebackfilling of subsidence areas. An important question to ask, therefore, is:


28



what are the risks and how can we monetize the value of the risksinvolved in Philex mining given that the country lie along the Pacific ringof fire that is vulnerable to frequent earthquakes and given that the Philexore body are crisscrossed by two fault lines?

Figure 37. Backfilling above active mining area (Source: PMC 2006a)

Figure 38. Milling flow sheet and transport to Poro Point for Japan or Leyte(Source: PMC 2007b)


29



V. Wastes and risks to the environment

A. Overview on Philex operation

Figure 39. Philex Mining Corporation ore body and mill (PMC 2007b)

As discussed earlier, the milling plant is around 2.7 kilometers away fromthe ore body (Sto. Tomas II deposit). Philex reports that the ore body is in Pacdal,Municipality of Tuba, Benguet Province. On the other hand, CADT (Certificate ofAncestral Domain Title) holders report that the Philex tailings ponds are in theMunicipality of Itogon, Benguet. Thus, effectively, Philex mine operations arenot only in the Municipality of Tuba but also in the Municipality of Itogon.Philex mining facilities or infrastructure straddle in the two municipalities: Tubaand Itogon.

As indicated by Figure 40 of the next page (and also by Figures 18 and 20of pages 18 and 19), the Philex ore body is below (or in the underground of) thesite of open pit mining done several years ago. Figure 20 page 19 of Chapter 4indicate the outline of open pit mining operations vis-à-vis current miningoperations done underground.

ATM/LGI a. boquiren May 2009 [email protected]

30



Figure 40. Close-up on Philex Mining Company ore body and mill (PMC 2007b)

ATM/LGI a. boquiren May 2009 [email protected]

31



B. Wastes, tailing ponds, and route of wastes

Figure 41. Map on Philex ore body, mill, residential areas, and tailing ponds(Source: PMC 2007b)

SunStar (2 February 2005) reports that in Philex operations, around 28,000tons of ore are milled daily but only 200 to 230 dry metric tons of copper areproduced daily. The rest becomes the mine tailings impounded on the tailingponds. As mentioned, Philex Mines has three tailing ponds: tailing ponds 1, 2,and 3.

Analyzing Figure 42 page 33, the earth position of the Philex orebody/open pit mine is approximately in the vicinity of 16º15’45.62” North120º37’18.87” East. Based on the shape of Philex tailing pond 1 on Figures 43 and47, pages 33 and 35, as well as Google Earth picture on Figure 42, Philex tailingspond 1 is in the vicinity of 16º15’53.08” North and 120º39’16.79” East.

Based on the location of Philex tailing pond 2 on Figure 41 above andGoogle earth picture on Figure 42, tailing pond 2 is approximately in the vicinityof 16º15’16.62 North and 120º39’43.84” East. Finally, based on Figure 41 and

Google Earth image on Figure 42, Philex tailings pond 3 is approximately in thevicinity of 16º14’31.34 North and 120º40’45.48” East.

Figure 42 indicates that tailing ponds 2 and 3 are connected and Figure 45page 34 indicates that both tailing ponds ultimately discharge into the AgnoRiver. As early as 2001, the Department of Environment and Natural Resources-Cordillera (DENR-CAR) has identified the three tailing ponds of Philex Mining

ATM/LGI a. boquiren May 2009 arturoboquire [email protected]

32



Company as among the seven geo-hazards of mining in the region of theCordillera, Philippines.

Figure 42. Philex open pit mine, tailing ponds, and nearby areas on Google Earth

(labels above are from Google Earth)

Figure 43. Tailing pond 1 undergoing rehabilitation as described by Philex(Source: PMC 2007b)


33



Figure 44. Philex open pit/ore body (Sto. Tomas II) and tailing ponds 1, 2, and 3

Figure 45. Philex tailing ponds 1, 2, and 3 and link to body of water (Agno River)


34



Figure 46. Philex tailings pond 1 then and now: 26 hectares, expected useful life

was 10 years, closed in 1981 (Source: PMC 2007b)

Figure 47. 2006 vegetation profile of decommissioned Philex tailing pond 1(Source: PMC 2007b)


35



Table 1 indicates the expected useful life, area, capacity, and status ofPhilex Mines’ three tailings ponds.

Table 1 . Philex tailings pond, expected useful life, area, capacity, and status

Tailing Pond/

Dam

Expected

Years ofUseful Life

Surface

Area(hectares)

Designed Impounding

Capacity (in metric tons) Status

Tailing Pond #1 10 26.16 85,259.975Closed in

1981

Tailing Pond #2 11 28.19 72,067,331Closed in

1992

Tailing Pond #3 18-20 63.08 142,000,000 Active

Source: Boquiren 2006:63 based on DENR-CAR data in April 2006

Tailing ponds 1 and 2 are already decommissioned while tailing pond 3 isreported by the company as its only “active” pond. Philex tailings dam 1 wasconstructed in 1967 but decommissioned in 1981. DENR records say that its

useful life is only 10 years. On the other hand, the dam walls of Philex tailingspond 2 (Padcal, Tuba, Benguet) collapsed in January 1992 because of “foundationfailure.” The collapse resulted to the release of 80 million metric tons of tailingsto the environment. Although Philex tailings dam 2 was alreadydecommissioned, Philex reported (April 2009) that tailings pond 2 toe dam hasbeen buttressed for stability. Philex brags that all the three ponds, includingthose decommissioned, are regularly being monitored by a multipartitemonitoring team. Through www.philex.com.ph (April 2009), Philex reported thata total of 9.07 million tons of mill tailings were impounded in tailings pond 3 in2007, bringing total tailings impounded since the ponds’ commissioning in 1992

to 127.23 million tons. According to the company, the dam embankment oftailing pond 3 is continuously being built-up by Philex Mines to maintain afreeboard of 5 meters at the mine dike. The company also said that earthworksfor a 32-meter spillway of the pond were done in 2007 to serve as additionaldrainage when the pond ceases operation.

Analyzing Figures 46 and 47 of page 35, we see that it took 20 years fornegligible vegetation to appear in the tailings pond 1 after beingdecommissioned in 1981. Thirty years after and it is obvious that the tailing pondcontinues to be unproductive and a wasteland. Counting approximately 10 years

during which the pond had served as a mine tailings pond, Figures 46 and 47indicate that tailing ponds would be unproductive for at least 40 years whenused as tailing ponds. This documentation has no pictures yet of Philex tailingsdam 2 but we can expect that most likely the situation of Philex tailings pond 2 ismuch worse than the situation of Philex tailings pond 1. Meanwhile, how aremine tailings managed in Philex tailings pond 3? The figures on the next twopages are instructive.


36



Figure 48. Mine waste management in tailings pond 3 (Source: PMC 2007b)

The illustration above from Philex itself describes how mine tailings aremanaged in tailings pond 3. Obviously, some of the environmental risks that canbe associated with Philex tailings pond 3 are the dissolved chemicals and heavymetals in the effluents from the tailing pond as well as the chemicals and heavymetals from the mine tailings deposited in the tailing pond.


37

DECANTATION TAKES PLACESEDIMENT SETTLES & CLEAR WATER

FLOWS TOWARDS PENSTOCK

TAILINGS DEPOSITED IN POND

TAILINGS CONVEYED VIA PIPELINE

FROM TAILINGS TUNNEL

DECANT WATER FLOWS

THROUGH DECANT TUNNEL



Figure 49. Tailings pond 3 is reported by Philex as its “active tailing pond”(Source: PMC 2007b)

Figure 49 above depicts Philex tailings pond 3. Boquiren 2006:63 says thataccording to Department of Environment and Natural Resources (DENR)documents, tailings pond 3 has a life of 18-20 years. If we mark 1992 as the startof operation of tailings pond 3, then the tailing pond has to be decommissionedin 2010 or around two years in 2012.

Philex has not reported any additional tailings pond and its miningoperations are likely to continue for at least several more years. This indicate thatin a few years’ time, it is highly likely that there will direct dumping of wastesfrom Philex Mines into the Benguet rivers unless Philex cease operating.

Based on information from Philex Mining Corporation provided by Figure20 page 19, Philex mining operation foresees that it may cease operating in 2012.Philex by then will be leaving at least 3 tailing ponds with an aggregate size of nofewer 117 hectares from the tailing ponds as wastelands, not counting a surfacearea of several hectares covering the site of the Philex open pit and undergroundmining.


38



C. Risks to the environment

Based on DENR-EMB data and Boquiren 2006:65-66, the rivers or waterbodies directly threatened by possible pollutants from Philex Mines are asfollows:

1. Albian Creek: at risk because the creek emanates from the subsidencearea of the open pit mine of Philex

2. Sal-angan Creek: at risk because the creek lies along the paths of twonon-operational mine tailing ponds (Philex tailings pond 1 and 2)

3. Balog River: at risk because effluents from Philex tailings pond 3converge with this river

4. Agno River: at risk because the Balog River eventually drains into theAgno River and San Roque Dam

Notes on the water quality of the said creeks and rivers are indicated bythe table below:

Table 2. DENR-EMB description on water quality of rivers threatened by PhilexRiver andLocation

Features and water quality

AlbianCreek

A tributary of Agno River in Ampucao, Itogon, Benguet. Emanates from the subsidence area of PhilexMining Company and underground water from Level 1170. The creek is nourished by the Bomolo creek andother intermittent creeks converge with the Albian Creek. Water quality: still within the water qualitycriteria for Class A freshwaters as to pH, DO, and TSS. Analyses on dissolved metals and total dissolvedsolids on the river are unavailable.

Sal-anganCreek

A tributary of Agno River in Ampucao, Itogon, Benguet. Originates from the mountain ridges of BarangayAmpucao; converges with the Albian creek at Sal-angan, Ampucao and discharges into Barangay Dalupiripin Itogon. Within the criteria for Class A as to pH, DO and TSS. The river is along the two non-operationalmine tailings dam of the Philex mines: Philex tailing ponds 1 and 2. Data on total dissolved solids andheavy metals on the river are unavailable.

BalogRiver

A tributary of Agno River in Ampucao Itogon, Benguet. A number of creeks upstream converge with thisriver. Effluents from tailings pond 3 of Philex Mining Company converge with this river and drains into SanRoque Dam. Nevertheless, the river is still within the criteria for class A as to pH, DO and TSS. Meanwhile,pictures in the possession of the Cordillera People’s Alliance (CPA) indicate that pH levels are maintainedthrough lime treatments. TDS concentrations of the company’s effluents as well as those of the Balog

River are beyond the effluent standards for class A.

AgnoRiver

Biggest river system in Benguet. Headwaters: Loo River in Buguias and Baayan River in Kabayan, both inBenguet. Meanders through Kabayan, Bokod, and Itogon, all in Benguet, then goes to the province ofPangasinan and finally into the Lingayen Gulf. The tributaries from Itogon include the Albian and Sal-

angan Creeks and Balog River. Visually clear waters are reported by the DENR-CAR to characterize themain river, including the tributaries. The TSS, TDS, pH, and DO concentrations are reported to conform tothe minimum water criteria. Gold panning that affects water turbidity along Ambalanga river are reportedby DENR-CAR. There is recognition that the river is not only a source of gold but also of freshwater food.

Farming is major livelihood in upstream portion while fishing is a source of livelihood midstream anddownstream of the river.

Source: Boquiren 2006:65-66 based on DENR-EMB data

The risks of Philex mine operations can be assessed further if we study theAlbian and Sal-angan creeks deeper and identify the aboveground andunderground exit points of the creek waters. Hydrology studies will be helpful.


39



Sal-angan/Banget and Omistic Fishponds

In an attempt to project a positive image on its environmental impact,Philex Mines funded the establishment of fishponds in Sal-angan and Omistic inItogon, Benguet Province. However, the fishponds are actually not along the

path of the active tailings pond 3 but along the path of inactive tailings ponds 1and 2. The fishponds are not at risk to active mine operations but tailing ponds 1and 2 may or may not be affecting fishpond water quality, depending on thewater source tapped for the fishpond. There is no study on this at the moment.

Inactive tailing ponds can have heavy metals or underground acid minedrainage. Fishes can ingest the heavy metals and consumption by humans offishes that ingested heavy metals can result to the bioaccumulation of metals inthe human body. On the other hand, there are species of fishes that are resistantto copper toxicity and some of the fish species can have adults that are resistant

to toxicity even if their larvae are not.

Figure 50. Decommissioned Philex tailings pond 1 and fishponds (Source: PMC 2007b,note similarity of depiction of tailing pond with those in Figures 43 and 47 pages 33 and 35)


40



To have a deeper understanding of the impact of Philex mining to theenvironment, we have to assess if the fishpond production at Sal-angan andOmistic (both of Itogon, Benguet Province) are commercially viable, if fishproduction in the said areas are as high as the fish produced in non-pollutedwaters, and if fishes from the fishponds do or do not have large quantities of

heavy metals in their bodies that can be passed on to humans via“bioaccumulation.”

Bioaccumulation is the process that takes place when heavy metalsaccumulate in the body as humans or organisms that are up in the food chain eatplenty of the fishes and plants or organism in the lower part of the food chainwith heavy metals in their bodies (see the March 2009 issue of EnvironmentalScience and Technology Briefs for Citizens in www.engg.ksu.edu).

Figure 51. Tilapia fish pond terraces at Omistic (Source: PMC 2007b,source of water unclear if contaminated by Philex tailing pond 1)

Another that has to be investigated is the risk posed by the miningmethod of Philex (see page 28 to 29) that backfills mining site. It is extremelyimportant to study the risks involved with the mining method given that the siteof ore is also along a fault line (see page 17).


41



Meanwhile, Figure 52 indicates that Philex also believe its greatest impactwill be in communities where the mill, tailing ponds, and ore body are located.

Figure 52. Philex Mining Corporation and company perception of its own impact(Source: PMC 2007b)

Figure 53. A view on the Philex facilities and host community(source: Philex Mines Corporation)


42



43

VI. Conclusions and recommendations for advocacy

Based on geology, product, and production process, the following aresome of the environmental risks and issues in Philex mine operations:

1. Environmental impact and geohazard risks posed by mine ore body2. Environmental impact and geohazard risks posed by tailings pond 1,

2, and 33. Adequacy of rehabilitation done for tailings pond 14. Existence of and adequacy of plans and resources for post-mining

operations management of tailings ponds 2 and 35. Risks posed by possible effluents from the Banget milling plant6. Impact of Philex operations on the Albian Creek, Sal-angan Creek,

Balog River and Agno River7. Details on and soundness of the Philex mine rehabilitation plan given

Philex’s possible exit from Benguet in 20128. Adequacy of the Philex rehabilitation fund given its level at P26.639

million as of 31 December 2009

Action on the eight (8) concerns and issues identified above are urgentgiven the possibility that Philex may cease operating in Benguet or withdrawfrom some parts of Benguet in 2012. Based on the stockholder profile of PhilexMining Corporation, the following should be considered as possible pressurepoints or allies once Philex reneged or fails on its corporate responsibilities,covering accountabilities related to the environment.

1. Social Security System (owner of a significant share of Philex)2. The Roman Catholic Archbishop of Manila (0.07% ownership)

For advocacy work abroad, the following are some of the pressure pointsbased on market and suppliers’ profile of Philex Mining Corporation:

1. Canada

In Canada, FECR can be a target. FECR (formerly Forum Energy

Corporation, see www.fecresources.com and www.sedar.com) is a 50.67%-owned subsidiary of the Philex Mining Corporation and was incorporated underthe laws of Alberta, Canada.

Another possible target is Philex Gold Philippines, Inc. or PGPI. PGPI isan 81%-owned subsidiary of Philex Mining Corporation through various holdingcompanies that were incorporated in the Philippines. However, PGPI itself was

ATM/LGI a. boquiren May 2009 arturoboquiren @yahoo.com



44

incorporated under the laws of Alberta, Canada. The company is primarilyengaged in the exploration and development of oil, gas, and minerals.

2. United Kingdom

Forum Energy Plc or FEP is a United Kingdom company incorporated inApril 2005 through the consolidation of the Philippine assets of Forum EnergyCorporation and Sterling Energy Plc (“SEY”) of the UK. FECR (incorporated inCanada) owns 29.78% of the FEP. FEP can be searched in Google Finance andhttp://investing.businessweek.com. It has a portfolio of oil and gas explorationprojects in the Philippines.

Almost 50% of the foreign sales of Philex go to L.D. Metals Ltd. The firm isunder registration number 04382295.

3. Netherlands

Philippine Gold Mining Company B.V. (PGMC-BV) was incorporated inThe Netherlands. In turn, PGMC-BV has been the holding company of theCanada-registered Philex Gold Inc. or PGI (see page 5 of theSGV&Co/Ernst&Young Independent Auditors’ Report to the Philippine SEC). Inturn, PGI is owned 81% by Philex Gold Holdings Inc. or PGHI (as per theorganizational church in www.philexmining.com.ph accessed April 2009).Finally, Philex Mining Corporation owns 100% of PGHI.

4. Japan

Almost 50% of the foreign sales of Philex go to Kyushu Island, Japan, inthe Saganoseki smelter of the Pan Pacific Copper Co. Ltd.

5. Australia

As discussed earlier, Philex obtains some of its supply needs from theCrushing and Equipment PTY Limited of Perth, Sydney, and Brisbane ofAustralia.

ATM/LGI a. boquiren May 2009 arturoboquiren @yahoo.com



BIBLIOGRAPHY

Boquiren, A. [2008] “Mining is the wrong engine for growth” in Goodland, Robert andClive Wicks, Philippines: mining or food . The Working Group on Mining in the

Philipines: London, United Kingdom.

Boquiren, A. [2007] “Towards a basic methodology in the benefit-cost assessment of

mining”, www.geocities.com/artboquirenpaperone/bcminingjan07.pdf.

Boquiren, A. [2006] “Valuation of Benguet biodiversity and environmental cost of

mining: monetization, intangibles, and policy”, www.haribon.org.ph and

www.geocities.com/harbibonartboquirenreport/benguetmining2006.htm.

Deparment of Environment and Natural Resources (DENR). [2008]. An overview of

minerals potential and opportunity in the Philippines.

Philex Mining Corporation. [2007a] Philex Mining Corporation: The Padcal Mine. APowerPoint Slide Presentation of Philex Mining Corporation (August): Benguet,

Philippines.

Philex Mining Corporation. [2007b] Philex Mining Corporation Tuba and ItogonBenguet: Social Development and Management Program (SDMP) and

Environmental Protection & Enhancement Program (EPEP). A PowerPoint SlidePresentation of Philex Mining Corporation (August): Benguet, Philippines.

Philex Mining Corporation. [2006a] Philex Mining Coporation. A PowerPoint SlidePresentation of Philex Mining Corporation (August): Benguet, Philippines.

Philex Mining Corporation. [2006b] Environment and community relations programs of

Philex Mining Corporation. A PowerPoint Slide Presentation of Philex Mining

Corporation (August): Benguet, Philippines.

Philex Mining Corporation. [2006c] Geology of Sto. Tomas II. A PowerPoint Slide

Presentation of Philex Mining Corporation: Benguet, Philippines.

Philex Mining Corporation. [2003] Banguet Concentrator. A PowerPoint SlidePresentation of Philex Mining Corporation: Benguet, Philippines.

Philex Mining Corporation. [_____] Annual reports to the Securities and Exchange

Commission, Various Years. Philex Mining Corporation: Benguet, Philippines.

SGV & Co and Ernst & Young. [2009]. Independent auditor’s report to the Stockholdersand Board of Directors, Philex Mining Corporation. Philex Mining Corporation:

B Phili i Th h d f h ffi i l f h

45

Philex+Dossier+2nd+Edition+by+art+boquiren+for+atm+and+lg

Documents

Transcript of Philex+Dossier+2nd+Edition+by+art+boquiren+for+atm+and+lg