Apex Mining mulls divestment of Mongolia assets

MANILA, Philippines — Razon-led Apex Mining Co. Inc. plans to divest its assets in Mongolia to reduce impairment charges.

Apex currently has a majority interest in Khar At Uui Gold Project in Mongolia, which remains under continued care and maintenance.

“Our president and geologists went to Mongolia to discuss with the principals there. I think we we might be divesting our Mongolian assets, hopefully reverse the impairment charges of P1.3 billion,” Apex Mining assistant vice president for investor relations Ramon Peter Adviento said during a virtual forum hosted by Philstocks Financial on Monday.

The project is under the joint venture firm Erdeneminas LLC, which is 51 percent owned by Minas de Oro Mongol LLC (Minas) – a wholly owned unit of Monte Oro Resources & Energy Inc. (MOREI) – and 49 percent owned by Mongolian exploration company Erdenejas LLC.

MOREI is a wholly owned subsidiary of Apex.

Last year, Erdenejas said a potential investor was eyeing to take over the joint venture company.

“An interested investor signified their interest to take over the joint venture company, but as of November 2022, Erdenejas has not given feedback on this said investor,” Apex said in its website.

In its annual report, the company recognized impairment losses of P578.76 million last year from deferred exploration costs amounting to P1.99 billion.

The same amount in impairment losses were registered in 2021 due to deferred exploration costs of P1.71 billion.

Despite plans to divest the Mongolian project, Apex remains on the lookout for possible investments overseas.

“Our geologists are looking at properties in areas where EKR (Enrique K. Razon) has ports. If there’s a potential in an area, we will look into it,” Adviento said.

“So, we are moving towards a level of ability to export human capital to open up new mines around the world. We’re preparing for that,” he said.

This also forms part of the company’s thrust to “reach world class mining status,” Adviento said.

“(We’ll have) access to better capital and then if we look at properties abroad, you will not be called too small. If you’re big, you’re world class, you can access…better jurisdictions,” he said.

Apart from Mongolia, Apex’s unit MOREI owns the Gori Hills project in the Republic of Sierra Leone in West Africa through Monte Oro Mining Co., which holds the tenements for the project and MORE Minerals SL (MMSL), previously engaged in artisanal mining and gold trading.

At home, its existing projects include gold mines in Maco, Davao de Oro; the Sangilo mine in Itogon, Benguet; and the Suyoc mine in Mankayan, Benguet.

Last year, Apex recorded a 408 percent surge in net income to P3.3 billion from P657.3 million in 2021.

Consolidated revenues reached P10.31 billion, up 39 percent from P7.4 billion.

Both topline and bottomline numbers were record highs.