Philex submits rehab plan for Padcal mine

MANILA, Philippines - Listed miner Philex Mining Corp. (PMC) has submitted to the Mines and Geosciences Bureau (MGB) its plan for the rehabilitation of its copper-gold mine in Padcal, Benguet.

In a filing late Thursday (Nov. 22), PMC president and chief operating officer Eulalio Austin Jr. said its Padcal Mine TSF3 Rehabilitation and Clean-up Plan contains the proposed rehabilitation and remediation plan for the broken tailings pond no. 3 and cleanup of areas affected by the tailings spill which was first monitored in August.

PMC officials assured the company is pouring resources in the construction of a spillway for tailings pond no. 3. The rehabilitated tailings pond would have a lifespan of three years, giving the company time to construct a new tailings pond while resuming operations.

The MGB will review the rehabilitation plan before implementation.

Philex also confirmed receipt of the letter from the Department of Environment and Natural Resources (DENR) upholding the imposition of the P1.034-billion fine on the company for violation of the Mining Act of 1995.

The department rejected the firm’s argument that the tailings spill was caused by force majeure due to the incessant rains leading to Aug. 1 when the leakage was first seen, and therefore, should not be fined.

In a letter dated Nov. 21 sent to Austin, MGB director Leo Jasareno said that upon evaluation of the firm’s comments to the letter first informing them of the fine, it was determined that “the incident was not a fortuitous event.

Environment Secretary Ramon Paje, however, has indicated that the department may still consider the company’s request to lower the fine, but not its argument that it should not be made to pay because of force majeure.

Philex is asking the DENR to use a lower density factor in computing the volume of sediments spilled to lower the amount of the fine.

The team that investigated the incident determined that the computed volume of the discharged tailings is 13,513,507 cubic meters, equivalent to 20,689,179.42 tons in weight using a density factor of 1.531 tons solid per cubic meter.

Paje said Philex is asking the DENR to use a density factor of 1.3 tons solid per cubic meter in the computation of the fine.

Philex has 45 days to settle the fine. Not until the company submits a revalidation of the volume of discharge - for which a third party assessor may be engaged - will the enforcement of the fine be put on hold.

Philex officials earlier said that it intends to settle its obligations to the government by yearend so it could resume the operations of the mine by middle part of 2013.

Paje said the primary concern of the department would be the state of rehabilitation of the mine and its environs. He said the decision on the continued operations of the mine would depend on the acceptable state of rehabilitation of the tailings storage facility and the areas affected by the spill.

If PMC proposes to pay the penalty on an installment basis, Paje said the government would also consider it so long as the company expresses intention to settle its obligation.

In the filing, Austin said the company would pursue a review of the findings of the MGB.

“The company will pursue appropriate remedied towards the review of the findings of the MGB,” he said.