APT clarifies Batong Buhay Gold Mines ownership issue

The Asset Privatization Trust will submit to Congress tomorrow, Monday, its response to a congressional inquiry into the controversial ownership of Batong Buhay Gold Mines Inc.

In an in interview with The STAR, APT chief executive trustee Renato B. Valdecantos said their response would clarify and answer the query of Rep. Rolex Suplico (LAMP, Iloilo) who recently questioned the alleged irregularities in the acquisition of Batong Buhay by its former owner, Antonio Tankiang.

According to Valdecantos, it seemed that the "Congressman was fed with a wrong information."

He said as far as APT records are concerned Batong Buhay ownership has not been transferred to anybody, particularly to Tankiang.

"The government still owns the (Batong Buhay) property. Maybe Rep. Suplico was mistaken because there was an agreement before but this (agreement) was not implemented since no payment was made by Tankiang that forfeited the said deal," Valdecantos said.

In 1989, he said the Committee on Privatization (COP) approved the offer of Tankiang to buy back the property under a so-called direct-debt buyout involving a total amount of P1.6 billion to be paid over 15 years.

As part of the offer, he said a P100 million downpayment was supposed to be paid by Tankiang.

However, Tankiang was able to pay only P10 million. Due to the failure to pay the required down payment, Valdecantos said the APT cancelled the agreement and forfeited the downpayment in 1992.

On July 1994, he said the APT board of trustees (Valdecantos was not yet a member) resolved to set aside the recision of the agreement and revived the transaction subject to the condition that the conveyance of the properties would be on an "as is where is basis" because at that time the physical condition of the assets had supposedly deteriorated.

Based on the APT appraisal value, the physical assets and mining claims of the company deteriorated to approximately P234 million only from the P1.6 billion offered direct buyout.

But even when the agreement was revived, Tankiang had failed to comply with his obligation.

Valdecantos said Tankiang had also failed to comply with his undertaking to resume the operation of the mine. "So in April last year, when we are the board already, we receded the agreement. This recision was relayed to Mr. Tankiang in June 1999. And this is, from our records, the current status of the company. So it has not been transferred to the former owner," Valdecantos said.

Valdecantos, however, admitted that when they served the notice of recision, Tankiang allegedly still expressed interest in acquiring the mining firm. However, up to now, there has been no concrete decision from Tankiang to pay the required downpayment.

The APT official said they are entertaining other investors who have indicated a willingness to buy the mining company.

"We are going to bid this property as required by our procedure through public bidding. We hope we can finalize the disposition plan soon and bid it out anytime this year," he said.

Batong Buhay stopped operations in 1985 and is now being manned by hired security guards under the payroll of APT.

The total exposure of the government in Batong Buhay, including principal, interest and equities has amounted to P4.8 billion through loans granted by Development Bank of the Philippines (DBP) and Philippine National Bank (PNB), two government-owned financial institutions.

DBP and PNB have loans to Batong Buhay amounting to P1.8 billion and P3 billion, respectively. These loans were eventually transferred to and absorbed by the APT.

Batong Buhay is located in Pasil, Kalinga Apayao. The company used to operate a 9,000-ton per day copper mine with gold and silver as by-products utilizing the block caving method of mining and the standard sulfide flotation process for milling. Its mining claims on an area of 444 hectares are covered by three mining lease contracts which were granted on July 10, 1981.