Business group warns foreign investors may shun RP if Lafayette is shut down

Federation of Philippine Industries (FPI) president Jesus Arranza warned yesterday that any injunction order stopping the 30-day test run of the mining operation of Lafayette Philippines in Rapu-Rapu, Albay could derail the infusion of more foreign mining investments into the country.

Arranza lamented that the government’s target of raising $122 million in mining investments by yearend has been imperiled by the injunction case that had been filed against Lafayette and Environment Secretary Angelo T. Reyes before the Makati Regional Trial Court.

"The Mines and Geosciences Bureau (MGB) has recorded a total of $47.91 million in fresh investments from January to May this year, on top of the $500 million previously infused in the government’s 24 priority projects in the mining sector," Arranza said.

"But now, this court petition against Lafayette and the Department of Environment and Natural Resources (DENR) might force foreign investors to bring their money elsewhere despite the renewed enthusiasm generated by the government in the mining sector," the FPI official added.

Arranza pointed out that the interests of investors in the local mining scene have intensified after Reyes allowed the test run of the Rapu-Rapu project after nine months of closure since October.

He stressed that the growing enthusiasm of investors will surely be dampened by any court intervention as the DENR decision ordering a 30-day test run for the Rapu-Rapu had been widely acclaimed as fair to all parties concerned.

The Rapu-Rapu mine site is expected to generate revenues of $350 million a year from an annual production of 10,000 tons of copper concentrates, 14,000 tons of zinc, 50,000 ounces of gold and 600,000 ounces of silver.

The three-stage test run in Rapu-Rapu required the completion by Lafayette of structures, including a storm drainage canal, bigger tailings dam, and emergency control mechanisms.

"Secretary Reyes ordered the test run after numerous consultations and studies conducted by environment, geosciences, health and environmental experts," Arranza said.