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Marcelle P. Villegas - September 02, 2022

PH and AU’s Mateship and Bayanihan through ASEAN

In relation to a webinar hosted by the Philippines-Australia Business Council (PABC) last 18 July 2022, regarding the ASEAN Australia New Zealand Free Trade Agreement and the Regional Comprehensive Economic Partnership, the Australian Embassy in the Philippine expressed their further support for Philippine’s economic sector through ASEAN last August. The diplomatic relations between Australia and the Philippines have a significant effect on some of the business sectors of the Philippines, like in infrastructure, construction, mining, food, agriculture, among others. From their Twitter post last August 3, the Embassy stated, “As Australia and the Philippines move towards upgrading our bilateral relationship, the work we do together through ASEAN will continue to help build a peaceful, stable, prosperous and resilient region for us all. Happy #ASEANDay55 from the Australian Embassy in Manila.”

Mining

Marcelle P. Villegas - September 02, 2022

ASEAN-AU NZ Free Trade Agreement: Open Economy for Economic Growth

How can the ASEAN-AU NZ Free Trade Agreement help the Philippines? Will their initiative and strategies for open economy help various Philippine industries like mining, construction, agriculture, transportation, telecommunications, and others? Last 18 July 2022, the Philippines Australia Business Council (PABC) in partnership with the Australia Philippines Business Council (APBC) and the Australia New Zealand Chamber of Commerce (ANZCHAM) hosted a webinar about the ASEAN Australia New Zealand Free Trade Agreement (AANZFTA) and the Regional Comprehensive Economic Partnership (RCEP). Their guest speaker was Assistant Secretary Allan Gepty of Department of Trade and Industry (DTI), International Trade Policy and Trade Negotiation. Atty Dennis A. Quintero was the moderator. He is the Chairman and Trustee of the Philippines-Australia Business Council (PABC). The opening remarks was given by Her Excellency Hellen B. De La Vega, Philippine Ambassador to Australia.  Bradley Norman, ANZCHAM Vice President, and Rafael Toda, APBC Vice President, delivered remarks on behalf of their respective organizations.

Mining

Philippine Resources - August 29, 2022

Chamber of Mines: Onerous Mining Tax Bill Contrary to Gov’t Pronouncements of Support for Industry

Photo credit: The Chamber of Mines of the Philippines The Chamber of Mines of the Philippines (CoMP) expressed concern over a proposed tax measure that may push back recent gains of the mining sector and deter prospective investments to the sector. The bill passed by the House committee on ways and means proposes the imposition of a royalty tax of 5 percent on gross output of large-scale mining operations, while increasing the share of the government to 60 percent of net revenues. The proposed legislation will also place a 10-percent export tax on mineral ore exports, to encourage domestic processing of mineral products. CoMP said that while the proposed measure runs contrary to pronouncements of the new administration, there were no consultations with the industry stakeholders to refute the onerous provisions of the bill. “We also maintain that figures shown during the Committee hearing that purported to show the industry’s effective tax rate at 38 percent was woefully out of date as such report was done in the year 2000, prior to the doubling of the excise tax on mineral products under TRAIN 1,” CoMP said in a statement. Once passed into law, the bill will render the Philippine mining industry as one of the highest taxed mining countries in the world.  It will also jeopardize the sector’s contribution to economic development in host communities that may result in a substantial reduction of exports and tax revenues and a considerable amount of social expenses. In addition, a number of large-scale operations run the risk of closure, resulting in massive unemployment in their areas of operations.  CoMP noted that bill will once again put into question the stability of mining policies, which is most detrimental to attracting foreign investments in such a capital-intensive industry.  “Foreign investors will simply look elsewhere, we are not the only country blessed with mineral resources. If further tax increases are unavoidable, the tax structure should not be onerous as to stop investments from coming in,” the group said. This will sustain existing mines and encourage quality investments in the hugely untapped Philippine minerals sector, ultimately expanding considerably the tax base and providing far larger tax revenues to government.  “We thus call on Congress to revisit the bill recently approved by the Committee on Ways and Means and allow for full and meaningful consultations with stakeholders,”CoMP said.

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Mining

Philippine Resources - August 29, 2022

House committee approves new tax regime for mining

A House of Representatives panel on Wednesday approved a new fiscal regime for the mining sector, which is expected to generate PHP37.5 billion in its first full year of implementation. The House ways and means committee approved a bill proposing a rationalized and single fiscal regime applicable to all existing and prospective large-scale metallic mines, regardless of location. The committee adopted the version of the Department of Finance, which would “bring the country’s effective tax rate on mining (considering all taxes) to 51 percent, up from 38 percent under the current system. Albay Rep. Joey Salceda, committee chair, said this would bring the Philippines "closer to the middle of the pack" among major mining countries, instead of near the bottom of the list. "51 percent is a good number, because it brings us closer to Australia’s effective tax rate, at around 51 percent as well, counting royalties. Among major countries, only Chile and South Africa have lower effective tax rates than us. This proposal brings us closer to Australia and Indonesia, which are our regional comparatives. China is at a very high 71 percent effective tax rate for gold mines,” Salceda said. He said the proposal would fulfill the panel's commitment to President Ferdinand "Bongbong" Marcos Jr. and the Department of Finance to raise revenues to fund the administration's priority programs. “With this measure, we are fulfilling our commitment to the President and to the DOF to raise revenues to fund PBBM’s priority programs,” Salceda said. Salceda explained that under Marcos’s Medium Term Fiscal Framework, the revenue program assumes a tax-to-gross domestic product (GDP) growth of 0.3 percent annually. “The mining tax reform takes care of half of that assumption already. So, if enacted, it will be very good for President BBM’s bigger ambitions for infrastructure, agricultural revolution, and a solid Filipino middle class," he said. The bill proposes the imposition of a royalty tax of 5 percent on the market value of gross output of large-scale mining operations. It also states that a minimum government share of 60 percent of net mining revenues, including all government taxes, fees, and charges, will be imposed on mining operations. A 10-percent export tax will also be levied on the market value of mineral ore exports, to encourage domestic processing of mineral products. “Mining GVA has been declining, but exports value has been increasing, indicating that most exports are ores without domestic value-added. I hope to continue engaging stakeholders on how we can use such a charge to improve the domestic mining value-chain,” Salceda said. Each mining project will also be treated as a separate tax entity, which would help curb the practice of tax avoidance by allocating costs among related projects within the same company, he noted. “It reduces room for transfer pricing, or the manipulation of expenses of a company with various subsidiaries or related parties in order to avoid taxes," he said. To institutionalize transparency standards, the government will implement a mechanism for the public disclosure and scrutiny of all mining tax and revenue data in the extractives value chain. Salceda pointed out that such standards could help mining companies access cheaper and more foreign funds and technologies to make mining more efficient.

Mining

Philippine Resources - August 19, 2022

DMCI Mining core profits up 8% to P542M in Q2; rises 11% to P1.1B in H2

Photo credit: Bilyonaryo DMCI Mining Corporation posted an 8-percent upturn in standalone second-quarter core net income from P502 million to P542 million as higher selling prices and stronger US dollar offset the combined impact of lower shipments and higher fuel costs. Including the impact of CREATE law last year, its standalone net income for the period contracted by 28 percent from P749 million to P542 million. “We are seeing some topline weakness because the depletion of Berong mine but with elevated nickel prices and steady production of our other mining asset, we think we can end the year strong,” said DMCI Mining president Tulsi Das C. Reyes. For the second quarter alone, DMCI Mining revenues declined by 20 percent from P1.5 billion to P1.2 billion. Average selling prices of nickel ore surged by 50 percent from US$42 to US$63 owing to global supply disruptions and strong China demand while the US dollar appreciated by ten percent against the local currency. From April to June, shipments plunged by 51 percent from 746,000 wet metric tons (WMT) to 367,000 WMT after production from sole operating asset Zambales Diversified Metals Corporation contracted by 24 percent from 328,000 WMT to 248,000 WMT. Consequently, DMCI Mining standalone topline for the first semester was flat at P2.6 billion while core net income rose by 11 percent from P979 million to P1.1 billion. Meanwhile, net income slipped by 11 percent from P1.2 billion to P1.1 billion with the adjustments made in 2021 relative to the CREATE law.   Article courtesy of the Philippine Stock Exchange

Mining

Philippine Resources - August 16, 2022

Global Ferronickel Holdings, Inc. records net income of P417.4 million in the first half of 2022

Photo credit: Global Ferronickel Holdings Global Ferronickel Holdings, Inc. (FNI) recorded a consolidated net income of ₱417.4 million for the period ended June 30, 2022. The results are driven by the April to June mining operations of Platinum Group Metals Corporation (PGMC) in Surigao del Norte, with incremental contributions from PGMC International Limited (PIL), a wholly-owned subsidiary established to facilitate relations with Chinese customers for the trading of mineral products. PGMC is the second-largest value exporter of nickel ore in the country. It is a wholly-owned subsidiary of FNI. Net income for H12022 is down 34.9% compared to the ₱640.8 million in the same period last year. Revenues also slid 15% to ₱2.21 billion for the period ended June 30, 2022 compared to the ₱2.61 billion posted during the same period last year due to lower volume of ore shipped. The Group encountered more rainy days this period totaling 128 rainy days compared to 105 rainy days during the same period in 2021. The Group only managed to complete 19 shipments of nickel ore totaling 1.035 million wet metric tons (WMT) during the six-month period ended June 30, 2022, compared to 32 shipments totaling 1.740 WMT during the same period last year. “We are hoping for better weather in Q3, during the peak of PGMC’s mining season that normally delivers more than 60% of FNI’s revenues for the year,” said FNI President Dante R. Bravo. Despite the fewer volume sold for the period ended June 2022, the Group benefited from the higher average realized foreign exchange rate this year at ₱52.60 compared to the prior period’s ₱48.24, augmenting revenues by a total of ₱177.1 million. Nickel ore prices are also higher this year with an overall average realized nickel ore price at US$39.21 per WMT, compared to last year’s period at US$31.10 per WMT, topping up revenues by ₱405.0 million. The resulting sales mix was 79% low-grade ore and 21% medium-grade ore in 2022 in contrast to the previous period’s mix of 84% low-grade ore and 16% medium-grade ore. These shipments comprise 0.816 million WMT low-grade nickel ore and 0.219 million WMT medium-grade nickel ore compared to 1.465 million WMT low-grade nickel ore and 0.275 WMT medium-grade nickel ore of the same period in 2021. “We have adjusted our 2022 shipment target to 4.0 million WMT but we still look forward to a productive and remarkable season due to the strong demand from China and favorable market conditions,” said Mr. Bravo.   Article courtesy of the Philippine Stock Exchange

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Philippine Resources - August 15, 2022

Celsius welcomes government’s renewed mining focus

In a boon for mining in the Philippines, Finance Secretary Benjamin Diokno has earmarked the sector as a source for long-term economic growth amid the pandemic. As reported in business publication, Rappler, Mr. Diokno said: “The mining industry holds the greatest potential to be a key driver in our economic recovery and long-term growth, especially now that world metal prices are high.” “The Philippines, after all, is one of the world’s most richly endowed countries in terms of mineral resources,” Diokno said. The Philippines mining industry had laid dormant for years as areas were closed to mining, and a comprehensive review was undertaken. This changed during Rodrigo Duterte’s last few months of presidency, however, as the country sought to reinvigorate its economy following reported missed growth targets. The Philippine Government’s renewed focus on mining was welcomed by Makilala Mining’s President, Mr. Julito Sarmiento. “We are thrilled with the government’s decision to again support mining in the Philippines,” he said. “Our flagship copper-gold projects in the Philippines, including MCB and Sagay, have the potential to create thousands of jobs and support local communities, whilst employing best practice mining techniques to protect the environment.” In a positive signal for renewed mining support in the Philippines, recently listed miner Philex will push ahead with its Silangan copper-gold mine which includes the development and construction of a mill plant, plus support facilities. The Department of Finance estimates that the project can generate Php8.5 billion in excise taxes alone for Silangan’s entire mine life. Mr Diokno lent his support to the project saying the mine will create jobs, reinvigorate local economies and provide additional revenues to government programs. He called on the mining sector to strike a balance between the local communities, the environment and the government’s economic agenda.   Article courtesy of Celsius Resources

Mining

Philippine Resources - August 15, 2022

APEX MINING’S 2Q REVENUE UP 65% YOY AT PHP2.537B

Photo credit: Apex Mining Apex Mining’s total revenue for the second quarter of 2022 reached PHP2.537 billion, 65% higher year over year (YoY). This pegs the resulting consolidated net income after tax of the company at PHP917.6 million, a 337% increase YoY. “This consolidated quarter net income is an an all-time high for Apex Mining,” says Apex Mining’s president and CEO, Luis R. Sarmiento, ASEAN Eng. “We consistently look at maximizing revenue through increased production output and minimizing cost through prudent spending.” Aside from earning big, the company also gave back in a big way with a P2M donation to the GMA Kapuso Foundation to build 2 classrooms in Baybayin Elementary School in Siargao Island (Surigao del Norte), following the devastation wrought by by Typhoon Odette in December 2021. The Kapuso Foundation and Apex Mining formalized their collaboration through a MOA signing in April of this year. Sarmiento says supporting the classroom-building efforts of the Kapuso Foundation is a good way to bring Apex Mining’s spirit of malasakit outside of its tenements in Davao de Oro. “Apex Mining’s mission to promote the wellbeing of our stakeholders is not limited to our host communities and impact barangays,” says Sarmiento. The second quarter also saw the company break ground for the construction of its accommodation facility for its employees in Barangay Nueva Visayas in Mawab (Davao de Oro). “Our employees are our greatest resource and we continue to prioritize their wellbeing. This new accommodation facility will provide better amenities for our hardworking miners.” Collaboration between the LGU and Apex Mining can also benefit the community of Barangay Nueva Visayas. The second quarter’s Maco mine production was higher YoY with total gold production reaching 23,715 ozs (14% higher YoY) and silver 99,645 ozs(29% higher YoY). Total tonnes milled in the second quarter were 197,891, 15% higher YoY. Daily mill throughput was 2,261 tpd, up 13% YoY. Mill feed grades were 4.14 grams per tonne for gold (Au) and 21.43 gpt for silver (Ag), higher by 26% and 12% YoY, respectively. In the second quarter, metal prices were higher by 3% for gold but lower by 17% for silver, averaging U$1,858/oz for Au and U$22/oz for Ag. The peso was also weaker at PHP53.43/U$1. According to Sarmiento, “Our sound fundamentals protect us from shocks.” In the second quarter, consolidated ounces sold were 48% and 8% higher YoY, respectively, with gold at 24,083 ozs and silver at and 94,234 ozs. Apex Mining’s total revenue for the 1st half of 2022 stood at PHP4.766 billion, 54% higher YoY, which is also an all-time high. The resulting unconsolidated net income after tax for the 1st half of 2022 stood at PHP1.565 billion, higher by 220% YoY and also an all-time high.   Article courtesy of the Philippine Stock Exchange

Mining

Philippine Resources - August 05, 2022

NICKEL ASIA CORPORATION ANNOUNCES P3.83B NET INCOME FOR H1 2022, UP 41% YoY

Photo Credit: Arrow Creatives Nickel Asia Corporation, the Philippines’ largest producer of lateritic nickel ore, reported a 41-percent increase in attributable net income for the first semester this year. Based on unaudited financial and operating results for the six-month period ended June 30, 2022, attributable net income increased to P3.83 billion from P2.73 billion while earnings before interest, tax, depreciation, and amortization (EBITDA) increased by 19 percent to P6.33 billion from P5.32 billion the year prior. Despite lower ore volume sold during the period, revenues increased by 7 percent to P11.78 billion from P11.01 billion last year, owed largely to higher nickel ore prices and favorable exchange rates. NAC’s four operating mines sold a combined 6.95 million wet metric tons (WMT) of nickel ore during the first half of the year, down 16 percent from 8.30 million WMT in the same period last year. The drop in sales volume was almost in direct proportion to unrealized workable days caused by inclement weather that adversely affected the Company’s mining operations during the period. The weighted average nickel ore sales price over the first half of year 2022 rose by 18 percent to $30.03 per WMT against $25.54 per WMT in the same period last year. The Company also realized P52.56 per US dollar from these nickel ore sales, a 9-percent increase from P48.25 last year. Breaking down the ore sales, the Company exported 3.12 million WMT of saprolite and limonite ore at the average price of $42.05 per WMT during the six-month period compared to 4.55 million WMT at $37.62 per WMT in the same period last year. Likewise, the Company delivered 3.83 million WMT of limonite ore to the Coral Bay and Taganito high-pressure acid leach (HPAL) plants, the prices of which are linked to the London Metal Exchange (LME) and realized an average price of $12.52 per pound of payable nickel. This compares to 3.74 million WMT at $7.92 per pound of payable nickel in 2021. Expressed in US dollar per WMT, the average price for the deliveries to the HPAL plants were $20.23 and $10.85 in the first half of 2022 and 2021, respectively. “The first half of 2022 was not without its challenges especially for our mining operations, brought about by weather conditions at our mine sites, particularly in Surigao, and continuing lockdowns in China, our major market,” said Martin Antonio G. Zamora, President and CEO. "However, the higher LME nickel price and stronger US dollar tempered the impact on our revenues.” Owing to the higher LME nickel price during the period, NAC also recognized gains from its equity share in investments in the two HPAL plants in the combined amount of P1.09 billion against P244.1 million year-on-year. The stronger US dollar further enabled NAC to log a 353-percent hike in net foreign exchange gains from its foreign currency-denominated net financial assets to P863.5 million from P190.6 million the year prior. Total operating cash costs decreased by 2 percent year-on-year to P5.19 billion from P5.32 billion last year. On a per-WMT sold basis, total operating cash costs increased to P747 per WMT compared to P641 per WMT in 2021. For the Company’s renewable energy business, its subsidiary, Emerging Power, Inc. (EPI) energized in June 2022 another 38-megawatt (MW) solar farm in Subic, Zambales, bringing total capacity on this site to 100MW. For 2022, the Subic plant has been operating at an 18- 19% plant efficiency factor with 90% of generation contracted under power sales agreements. EPI has realized an average tariff of P4.65 per kilowatt hour. EPI has another 100MW service contract for the Subic site and will commence construction of a 68-MW farm in August. Completion is expected by the third quarter of next year. EPI was also chosen by Shell Overseas Investments B.V. to be its exclusive local partner in a solar, onshore wind, and battery storage joint venture that aims to contribute up to 3GW into the Philippines’ renewable capacity. NAC is evaluating a range of financing alternatives including accessing global debt capital markets to raise EPI’s share of the equity required for an initial 1GW target by 2028, among other uses. The Company’s strong financial position will allow it to be opportunistic in evaluating funding options that meet the primary objective of maintaining a flexible low-cost capital structure. “We remain confident that our mining and renewable energy businesses provide a solid foundation on which to realize the OneNAC Vision’s twin objectives, which is to become the premier ESG investment in the country and to be counted among the Top 25 PSE-listed companies in terms of market capitalization by 2025,” said Zamora.   Article courtesy of the Philippine Stock Exchange

Mining

Philippine Resources - August 04, 2022

Further shallow copper mineralisation identified at MCB

Figure 3. Cross section of drill hole MCB-039 relative to the interpreted geology and significant assay results. We (Celsius Resources) are pleased to announce we have received further shallow and high-grade copper assay results from the ongoing drilling program at our flagship MCB copper-gold project, held under our Philippine subsidiary Makilala Mining Company, Inc. (“MMCI”).  The results continue to identify new positions of shallow mineralisation which are in line with other recent drilling results from holes MCB-036, MCB-037 and MCB-038 (see CLA announcements dated 13 December 2021, 23 May 2022 and 4 July 2022 respectively) confirming the presence of an extensive shallow higher-grade position.  The results from MCB-039 were designed to further expand the size of the shallow higher-grade copper zones which are considered to have an important positive impact on early mining options at MCB. The current drill hole in progress (MCB-040) is similarly designed to further expand the higher-grade copper mineralisation leading to potential improvements to the economics of the already positive Scoping Study at MCB as reported by Celsius on 1 December 2021. “The results from MCB are continuing to grow the size of the shallow higher-grade copper zones,” said Country Operations Director, Peter Hume. “We are getting much better definition now on the various high-grade zones, which are important for the optimisation of the MCB mine plan. We can see many good high-grade intersections coming together to expand on the earlier understanding of these high-grade zones. Where we get multiple high-grade zones staked on top of each other, we can achieve outstanding results, as recently announced from hole MCB-038 which intersected 611.4m @ 1.39% copper and 0.75g/t gold from 32.5m.” RESULTS FROM MCB-039 Drill hole MCB-039 was drilled to further confirm the interpretation that further shallow high-grade positions exist as a relatively flat body extending into the surrounding host rocks (see Figures 2 and 3). This drill hole was more specifically targeted to fill a gap in the drilling information where there was previously defined lower grade copper mineralisation. The results from MCB-039 have confirmed the further extensions to the higher-grade copper mineralisation as part of a series of relatively flat lying, high-grade zones which are extending away from vertically orientated feeder structures which are all closely related to an intrusive Tonalite rock (Figure 3). Figure 2. Location of MCB-039 drill hole relative to recent and historical diamond drilling at MCB.​​​​​ A large broader envelope of copper mineralisation at a lower cut-off grade at approximately 0.2% copper also continues to be better defined, highlighting the very large scale of the copper-gold mineralisation at the MCB deposit. Table 1: Significant intersections from drill holes MCB-039.   Article courtesy of Celsius Resources. Full press release can be found HERE

Mining

Philippine Resources - August 04, 2022

Diokno banks on mining for sustained economic recovery, expansion

Photo credit: PNA - Finance Secretary Benjamin Diokno Finance Secretary Benjamin Diokno said the mining industry is a potential source of sustained economic growth as he underscored the benefit of mobilizing investments for mine development. “The mining industry holds the greatest potential to be a key driver in our economic recovery and long-term growth, especially now that world metal prices are high. The Philippines, after all, is one of the world’s most richly endowed countries in terms of mineral resources,” he said Wednesday at the listing of Philex Mining Corporation’s (Philex) common shares in the Philippine Stock Exchange (PSE). Philex is mobilizing investments for the development of its Silangan underground copper-gold mine in Surigao del Norte. In a disclosure to the PSE, the company said it is offering a maximum of 842 million common shares at the rate of one offer share for every 5.8674 shares owned for PHP3.15 each to raise a total of PHP2.652 billion new equity. The stocks rights offering (SRO) period started on July 12, 2022 and ended July 25, 2022. The Silangan project, considered one of the biggest copper-gold mines in the country, is planned to be mined in two phases. The first phase has a mineable ore reserve of 81 million metric tonnes which will be mined for 22 years at a rate of 4 million tonnes per year. The mine is targeted to commence commercial operations in the first quarter of 2025. Diokno said Philex’ SRO listing demonstrates the mining industry’s confidence in the country’s promising economic growth prospects.   He said the offering means more jobs will be created, local economies will be reinvigorated, and additional revenues will be contributed to the government.  The Department of Finance (DOF) estimates that the project will generate around PHP8.5 billion in excise taxes alone for its entire mine life. Diokno said the listing sends a strong signal to the mining industry that the country's capital markets are viable instruments for fast tracking the development of large mining projects.   He said the Marcos administration is committed to continue creating an enabling environment for mining activities to flourish in the country as he looks forward to similar listings in the future. “We recognize that apart from boosting local development, mining is a strong magnet for investments that can propel our economy into a higher growth trajectory,” he added. Diokno said the government expects the mining industry to strictly adhere to responsible and sustainable mining practices.  He said the mining industry should strike a balance between protecting the environment, uplifting local communities, and supporting the government’s socioeconomic agenda. “This is a non-negotiable condition so we can guarantee the sustainability of the industry and the strong economic growth of its host communities,” he said.    Article courtesy of the Philippine News Agency

Mining

Philippine Resources - August 03, 2022

SMPC nets P10.8B in Q2, up 171%; H1 earnings surge to record high

Photo credit: PH Stocks Integrated energy company Semirara Mining and Power Corporation (SMPC) posted P10.8 billion in second-quarter net income, 171 percent better than the P4 billion reported last year. All-time high coal selling prices coupled with higher spot electricity sales volume at elevated prices accounted for the upsurge. From January to June, SMPC’s bottom line more than quadrupled (311%) from P6.3 billion to P25.8 billion, its highest for any given semester. “As expected, we had a weaker performance quarter over quarter because of the China lockdowns but compared to last year, we did very well,” said SMPC president and COO Maria Cristina C. Gotianun. “We maintain our view that the second semester will be anemic because of market volatility and unfavorable weather conditions,” she added. For the second quarter alone, contributions from the coal segment grew by 195 percent from P3 billion to P9 billion while SEM-Calaca Power Corporation (SCPC) accounted for P1 billion, up 81 percent from P581 million. Southwest Luzon Power Generation Corporation (SLPGC) contributed P742 million, a 107-percent increase from P359 million. Coal Operating Results Total shipments from April to June dropped by 24 percent from 4.9 million metric tons (MMT) to 3.7 MMT as China imposed COVID-19 lockdowns and shifted to Russian coal. Export sales plunged by 44 percent from 3.2 MMT to 1.8 MMT while domestic sales grew by 12 percent from 1.7 MMT to 1.9 MMT. Buffering the impact of lower shipments was the 126-percent increase in average selling prices from P2,393 to P5,399, the highest for any given quarter. Heavy rainfall and higher stripping activities curbed coal production, dropping 21 percent from 4.3 MMT to 3.4 MMT. This, together with lower sales volume, raised high-grade coal inventory by 50 percent from 1.0 MMT to 1.5 MMT. Power Operating Results Overall gross generation in the second quarter was mostly flat at 984 GWh as SCPC Unit 2 remained on forced outage because of a defective generator stator. Total electricity sales declined by 9 percent from 987 GWh to 900 GWh, most (56%) of which was sold to the spot market. The rest (393 GWh) was sold through bilateral contracts. High uncontracted capacity allowed SMPC to boost spot electricity sales by 188 percent from 176 gigawatt-hour (GWh) to 507 GWh. Average spot selling prices remained elevated at P6.91 versus P6.87 last year. Total spot purchases declined by 60% from P617 million to P245 million on higher plant availability, which improved by 8 percent from 60% to 65%.   Article courtesy of the Philippine Stock Exchange

Mining

Philippine Resources - August 02, 2022

A kick-off to a modernized mining compliance and monitoring system

Photo: Group photo of the participants after the MGB Management approved the Capstone Project (CP) for implementation during CP Orientation on July 12, 2022 With the start of online transactions, the Mines and Geosciences Bureau (MGB) is currently developing a system that will serve as a digital platform for the submission of the compliances by the mining companies and stakeholders with the terms and conditions of the Contracts/Permits/other similar Mining Tenements, and other pertinent laws, rules, and regulations. The project is the approved Capstone Project (CP) of Mr. Jeffrey S. Ledesma, a scholar of the Development Academy of the Philippines under the Public Management Development Program. His CP entitled, “Strengthening Mining Monitoring Method by Enhancing Mining Compliance Procedures Through Process Automation: Development of an Electronic Mining Compliance and Monitoring System (eMCMS)” was conceptualized through the guidance of his Institutional Partners, Engr. Nonita S. Caguioa, Department of Environment and Natural Resources Assistant Secretary for Finance, Information Systems, and Mining Concerns and Engr. Teodorico A. Sandoval, Chief of the MGB Planning, Policy, and International Affairs Division (PPIAD). The project was approved for implementation by the MGB Management on July 12, 2022, during the CP Orientation. The project targeted the internal and external stakeholders as the beneficiaries. It is designed in three phases based on its scope and coverage in terms of mining scale, mineral type, and policy requirements. The Phase I will serve as the pilot phase which aims to use the system by the selected mining companies who will initially be engaged in the design, development, and implementation. Phases II and III will commence after the successful pilot testing and integration of provisions in the mining-related policies which will serve as the legal basis for its implementation. Phase I is expected to be completed at the end of September 2022. The eMCMS development is an in-house system development through the collaborative effort of the eMCMS Technical Working Group created on July 28, 2022. The success of this project will improve the organizational productivity of the MGB and mining companies’ technical personnel conducting the monitoring activities and mining compliance respectively. Likewise, it will provide an efficient and effective way of delivering services to its stakeholders because of the conversion of manual to electronic and digital transactions. It is also expected that related information will easily be generated and shared to the public. This initiative will ensure the integration of other government policies such as the ease of doing business, e-commerce law, and the Data Privacy Act among others.   Article courtesy of the MGB

Mining

Philippine Resources - July 28, 2022

Atlas Mining Attained Php2 Billion Net Income in 1H 2022

Atlas Consolidated Mining and Development Corporation (“Atlas Mining”) completed the first half of the year 2022 with a reported net income of Php2 billion compared to the net income of Php1.935 billion for the same period in 2021. The improvement in the bottom line is attributed to the considerable increase in grades and metal prices during the first half of the year. Atlas Mining’s wholly-owned subsidiary, Carmen Copper Corporation, reported copper metal production from 38.73 million pounds in 2021 to 36.58 million pounds in 2022 which attributed to lower tonnage milled. In the first half of 2022, milling tonnage decreased by 6% from 9.26 million tonnes to 8.66 million tonnes. On the other hand, copper grade increased by 1% from 0.231% to 0.234% and gold grade improved by 6% from 5.09 grams/dmt to 5.41 grams/dmt. Copper metal content of concentrate shipped decreased by 2% to 38.80 million pounds but gold content increased by 6% to 11,212 ounces due to higher gold grade. The increase in metal prices continued in the first half of this year where copper price increased by 6% from $4.21/lb to $4.45/lb and gold price increased by 4% from USD1,812/ounce to USD1,879/ounce compared to the same period last year. Number of shipments were comparatively the same as first half of last year but the higher prices in the first half of this year pushed revenues to grow by 8% to Php9.74 billion from Ph9.01 billion. Earnings before interest, tax, depreciation and amortization (EBITDA) settled at Php3.89 billion in the second quarter of 2022 compared to Php4.93 billion in the same period of 2021. The reduction was caused by the increase in energy cost particularly power and fuel. This likewise pulled down core income for the period to Php930 million in the first half of 2022 from Php2.16 billion in same period of 2021. Accordingly, cash generated from operations improved which enabled the additional loan payment of $60 million of Atlas Mining’s loans on the first half of 2022. With the partial repayment of loan, an accounting gain of Php938 million was recognized in the second quarter.   Article courtesy of the Philippine Stock Exchange

Mining

Philippine Resources - July 28, 2022

Ilocos Norte to recognize best practices in mining

Photo credit: Provincial Government of Ilocos Norte logo Ilocos Norte is set to recognize the public and the private sector’s initiatives and exemplary achievements in promoting responsible mining. Provincial administrator Yvette Convento-Leynes confirmed this on Monday as she reported that the awarding of outstanding partners is set on July 27 in time for a provincial mining summit at the JLP Resort in Barangay Suba, Paoay, Ilocos Norte. “One of the highlights of the summit is to recognize and give special wards to our outstanding quarry permittees who adhere to our rules and regulations as well as those who help us in apprehending violators,” she said, stressing the importance of the quarry industry as a major source of local revenue in the province. “This is the only way to thank them for the contributions they are giving to the province,” she said. The provincial government, however, has yet to announce the awardees. To date, the Provincial Quarry Office reported that there are about 60 permit holders of commercial sand and gravel and 22 permittees of industrial sand and gravel. Hosted by the Department of Environment and Natural Resources-Environment and Management Bureau and in cooperation with the Ilocos Norte government, the mining summit aims to discuss pressing issues and concerns for the minerals industry in the region. Existing quarry permittees, including new permit applicants, are expected to attend to help them become updated of the best practices and new mining policies. Earlier, the Commission on Audit commended the Provincial Quarry Office under the provincial government for increasing its quarry collections to PHP43.8 million in 2021 as compared to the PHP26.8 million in the previous year. By Leilanie Adriano   Article courtesy of the Philippine News Agency

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