"The commission blundered in a very basic area of comparing six-month production figures with those for nine months. The error stemmed from the commission’s lack of understanding of the mining and milling process," Lafayette said in a press statement.
"If only the commission had asked us to explain, they could have spared us the temporary suspicion of fiscal irresponsibility, and themselves the embarrassment of being unmasked for a report that is biased, flawed, unscientific, and irresponsible," said the statement.
"The simplest way to explain this," the company said, "is that bottom line, we paid the tax based on production figures the commission said it should be based on. Put another way, we did not evade tax payments because we paid the amount the commission said we should pay."
The company said ore production totaling almost 70,000 metric tons (MT) was started in April-June 2005 to build up inventory for a July milling operation. Production from July to October amounted to 67,000 MT.
"Our fiscal year starts in July. The commission looked only at our July-October production report and concluded that we hid the April-June output. They were using the calendar year and we were using the fiscal year. In short, they compared a six-month production figure with that for nine months," the company said.
Lafayette said the commission presumed a 100-percent recovery of gold and silver from the ore, which is not possible.
Moreover, the Commission report also accused the company of contaminating with mercury the waters of Sorsogon’s coastal areas, saying it was "probable" despite several scientific studies and tests by independent qualified entities virtually saying it was a hoax.
The National Bureau of Investigation’s preliminary findings show that unidentified and possibly anti-mining groups started the hoax to stop the company’s project. The company has been saying it does not use mercury and could not possibly cause one.
The commission, added Lafayette, also trashed medical and scientific reports that a reported case of skin disease in a child in Rapu Rapu was caused by bacterial and fungal infection. Instead, it said it is caused probably by what it called "the theory of the weakening skin immune system" resulting from hexavelent chromite that the project does not even produce.
The Lafayette mine site was closed down in October last year because of alleged mine spills. It has since then been appealing for the resumption of its polymettalic project in Rapu-Rapu Albay after complying with more than 20 conditions set by the Environmental Management Bureau of the Department of Environment and Natural Resources.