Manila Mining suspends operations, lays off 66% of workers

Manila Mining Corp., one of the country’s leading copper and gold producers, has suspended its operations and retrenched about two thirds of its employees at its minesite in Placer, Surigao del Norte due to accidental waste spillage problems.

In a disclosure to the Philippine Stock Exchange, MMC said the shutdown of its operations took effect the other day in view of the expiration of the Temporary Authority to Construct and Operate Tailings Pond No. 7 issued by the Department of Environment and Natural Resources last January.

The company said the suspension of works at the minesite came about when more than two million metric tons of waste slipped over the ore zone at the height of Typhoon ‘Toyang’ in November 2000.

"This waste material cannot now be removed without spending tens of millions of pesos, making the further operation of the Heine Pit unprofitable," MMC president Artemio Disini said. The Heine Pit, from which gold bullion was produced, accounts for about half of total revenues from the mine’s operations.

He said this development could have been avoided were it not for the delay in the pit development, which was, in turn, a result of the continued protests of a group led by local priests against the raising of the tailings pond since last year.

"Because of this, Manila Mining slowed down and eventually stopped the raising of the tailings pond to its approved height. The demonstration, which took a heavy toll on the company’s finances and operations, prevented vital workers and much-needed supplies from entering the mine camp and resulted in a critical delay in the pit development work," Disini pointed out.

The DENR had approved in 1993 the construction and operation of the tailings pond up to an elevation of 70 meters. Since then, the DENR has been monitoring and has consistently found the tailings pond to be structurally sound, and has been backed up by several investigations by reputable international and domestic consulting firms.

He said the company continued to mine the remaining pits and produce gold-copper concentrate, earning just enough to cover operating costs and to prevent the mine from shutting down and laying off more than 1,300 employees and contractors.

During the shutdown, MMC will be maintaining a reduced workforce and temporarily lay off about two thirds of its employees. The work during the shutdown will focus on extensive drilling, which will convert the large inventory of resource to ore reserves and prepare the mine for better operations.