Climax is also expecting to complete negotiations with several foreign financing institutions that will initially lend $100 million to accelerate work on Didipio. The banks include ABN AMRO, Macquarie Bank, NM Rothschild and Sons, Societe Generale Australia Ltd., Standard Bank London Ltd., Fortis Bank, and Invesytec Bank (UK Ltd.).
Robert Thomson, chief executive officer of Climax, said its local unit, Australasian Philippines Mining Inc. (APMI) expects to firm up negotiations with the two companies in the coming weeks.
"LG and Pan Pacific are deeply interested in taking both equity and off-take agreements. In exchange for financing the project, both companies could have an equity and take a percentage of the project output when it is in full steam," Thomson said.
He said that LG’s consultant Korean Resources (Kores) conducted a field visit in Didipio last week while Pan Pacific officials will be in Manila in October for another round of negotiations and will also be attending the ASEAN Mining Conference.
He noted that both companies, like Climax, have established projects in the Philippine mining sector.
"Pan Pacific has demonstrated long-standing commitments in the country. It has interests in Philex Mining’s Padcal operations near Baguio through direct investment and is purchasing part of the concentrate for shipping to Japan," said Thomson.
On the other hand, Kores and LG have invested in the Rapu Rapu polymettalic project of Australian firm Lafayette Mining Ltd. in Sorsogon province in the Bicol region.
On Climax’s talks with banks that will bankroll the project, Thomson said the company hopes to wrap up talks before the end of the year. The same consortium of banks funded the Rapu Rapu project.
Thomson added that the Sangguniang Panglalawigan (SP) of Nueva Ecija recently unanimously endorsed the Didipio project.
The Didipio copper-gold project is one of 23 flagship mining projects of the government and is only one of two foreign mining companies that have acquired a financial and technical assistance agreement (FTAA).
An FTAA is a 25-year mining contract that allows foreigners to hold 100-percent ownership of a mining project.
Earlier, APMI chairman Jose P. Leviste Jr. said the investment would be on top of the P2 billion that the company had spent for various exploration projects in the Philippines since 1989.
Leviste said that APMI will be spending $79 million to $81 million for open cut establishment, processing plant and installation of infrastructure, and within the next five years, raise an additional $35 million to $39 million for its underground mining operations. The construction of the plant will begin in 2006.