Sagittarius Mines eyes 2016 gold, copper operation in Sarangani Regions Written by Manuel T. Cayon / Reporter WEDNESDAY, 23 SEPTEMBER 2009 00:09 DAVAO CITY—The Sagittarius Mines Inc. (SMI) has set its eyes on 2016 as the likely year it will start mining its gold-and-copper concession that traverses the south-central Mindanao triboundary in what could yet be the country’s biggest operation of a confirmed world-class deposit.
SMI’s corporate-community sustainability manager Elvie Grace Ganchero told the 18th Mindanao Business Conference in Koronadal City, South Cotabato, on Friday the operation would commence after the completion of several studies and legal requirements.
“Subject to the completion of a positive final feasibility study and all necessary community, government and company approvals, SMI estimates production may start by 2016 of what could be the biggest mine in the Philippines, and one of the top copper producers in the world,” Ganchero said.
SMI has begun what it claimed as “extensive specialist studies for the Environmental and Social Impact Assessment (Esia) of its world-class Tampakan copper-gold project located in Southern Philippines,”
Ganchero said SMI is spending $74 million on its feasibility study and Esia.
“As we embark on the Esia, a range of specialist studies on environmental and social aspects are underway,” Ganchero said. “To ensure a well-informed environmental management plan, all the studies are being conducted by international and local experts who are recognized authorities in their fields.”
Only last month, Ganchero said, “international experts conducted the soil-and-land capability study to determine the properties of the soil within the project area, and its suitability for use in postmining rehabilitation.”
Experts from the University of the Philippines in Los Baños assisted in the study, she said, while another group of experts conducted the survey of flora and fauna “to determine the ecological importance of the proposed mine area, and develop appropriate conservation programs for these plant and animal species.”
“The University of Queensland and its local counterpart, Visayas State University, are now working on a robust forest rehabilitation and management program,” she added.
Ganchero said SMI has already “conducted extensive studies of water [hydrology] and aquatic biology that commenced before the Esia phase.” She said SMI has collected more than two years “of high-quality data on these environmental components through international experts on hydrobiology.”
Studies on air, noise, rehabilitation, waste management, terrestrial biology, water, health and visual and socioeconomic impacts have been lined up, as well, for the next round of activities of SMI.
“This transparent and open engagement will ensure that all stakeholder concerns are gathered and considered in the conduct of our technical studies and, eventually, in the development of plans to mitigate and manage the effects of our operation,” Ganchero said.
In April this year, SMI posted a statement on the Internet which informed its “funding shareholders” that the likely final average output of its Tampakan copper-and-gold productions would use the open-pit mining operation.
SMI president Peter Forrestal was quoted on the Internet statement as saying that the “results of its work programs associated with the extended prefeasibility study for the Tampakan copper-gold project in Southern Mindanao” would likely get its first production output by 2016.
In the statement, Forrestal said the work program identified in the study has already determined the average output, the extraction method, mill-recovery rates and the capital outlay for its initial stage of operation.
He said, “These results are still subject to a final feasibility study and that the work program outlines a potential mining operation” based on indications that the mining project covering the boundary villages of South Cotabato, Sultan Kudarat and Davao del Sur would have “an annual average copper production of 340,000 tons per annum and 350,000 ounces of gold per annum, based on a 20-year operation.”
The study also suggested an “open-pit mining and land-based waste rock and tailings storage.”
“Mill recovery rates [are] 83 percent to 90 percent for copper and 60 to 80 percent for gold, with a copper concentrate grade of 37 percent to 34 percent,” the statement said.
Forrestal said the company would need “an initial stage-one capital outlay of $5.2 billion,” which he added would include a “provision for associated infrastructure.”
“A potential schedule for development with commissioning and first production [would be] in early 2016,” he said.
“We are pleased to have completed the work programs associated with our extended prefeasibility study and to have delivered the results to our management committee,” Forrestal said. He added that the committee was comprised by representatives from Xstrata Copper, Indophil Resource NL and Alsons Corp.
“Those organizations are currently evaluating the results of this study,” he said. SMI planned “to commence the public consultation phase for the project’s Esia process later this year,” he added.
“This phase will involve a series of extensive, open and transparent public consultations with the project’s stakeholders. The consultation will cover the proposed mining process, the scale and extent of the proposed project, including the infrastructure requirements, the potential environmental and social impacts and benefits of the project; SMI’s planned environmental management systems and socioeconomic development programs,” he said.
“Most important, it will give our stakeholders the opportunity to understand the project better, and to express their views and any suggestions they may have in respect of the proposed project,” he added.
“Our aim is to develop the Tampakan project in line with leading environmental and social practices, working in partnership with our stakeholders to create mutual benefits for shareholders, the communities associated with the project and the Philippines,” Forrestal said.
In a December 2007 statement, SMI corrected previously held estimated figures of the copper-and-gold deposits in the project and said the project holds ore deposits “of over 12.8 million tons of 0.6-percent copper and 15.2 million ounces of 0.2 grams per ton of gold.”
“The Tampakan copper-and-gold project is reportedly the biggest of its kind in Southeast Asia and the Western Pacific region,” Forrestal said in that statement..
The Switzerland-headquartered Xstrata Copper owns 62.5 percent of SMI. The Xstrata has 19.9-percent stake with another Swiss-based Indophil Resources, which acquired the Financial and Technical Assistance Agreement of the Tampakan project in the late 1990s from the original rights holder, the Australian-owned Western Mining Corp. (WMC).
In 2002 WMC sold its rights to Indophil, which later sought financial assistance from Xstrata. Under their arrangement, Xstrata has the option to exercise full management rights the operation and which Xstrata opted to exercise in 2007.
The Alcantara and Sons Inc. acquired a third of the stake in SMI in a bid that started last year. The stake was bought from the shares of Indophil.
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