Philex secures $8.5-M loan for mine dev’t

Philex Mining Corp. has obtained an $8.5 million loan facility from a syndicate of local banks to finance the underground development of its Padcal mine in Benguet province.

In a disclosure to the Philippine Stock Exchange, Philex said Bank of Commerce, Philippine National Bank and International Exchange Bank are granting the loan.

The projected capital cost for the development of the Padcal mine amounts to P538 million this year and P210 million in 2006.

The Padcal mine, the country’s only remaining copper-gold operation, has been in continuous production for the past 46 years. The development of the next mining level would extend the Padcal mine life up to 2011.

Throughout its long operating history, the Padcal mine has generated $2.6 billion in exports and P8.9 billion in tax revenues for the government.

Philex said the 782-meter-level of the Padcal mine is expected to be operational by the fourth quarter of the year.

The company reported a consolidated net income of P236.4 million in the nine months ending September this year, a reversal of the P133.7-million loss incurred the previous year, largely due to the increase in concentrate shipments and higher realized metal prices.

The increase in revenue was partly offset by higher operating cost and expenses of P2.9 billion from P2.1 billion a year ago.

Income from operations amounted to P463.3 million, a marked improvement against the prior year’s P19 million.

The turnaround was attributed to higher metal price levels at $473.25 per ounce of gold and a record high of $1.80 per pound for copper at the end of September.

Inspite of the foreseen increase in cost and expenses, particularly in power and fuel, Philex is optimistic that with the improved production output and current level of metal prices continuing up to end of the year, the company will sustain its gains and post significantly higher earnings this year than last year.

Philex primarily produces copper concentrates containing copper, gold and silver and gold bullion. Its copper concentrates are either exported to Nippon Mining Co. Ltd. and smelted in the Saganoseki Smelter in Kyushu Island, Japan.