FOR THE fifth successive year, the gross national product has shown a positive growth since the start of the term of President Corazon Aquino in 1986. The increase in GNP for 1990 was 3.08%, according to National Economy Development Authority (NEDA), and was down slightly from 1989's figure of 5.7%. The decline was attributed to the many natural calamities that hit the country, to the increase in oil prices and the imposition of a 9% levy on all imports. The foreign exchange rate went up from PP22.428 to PP28 for $US1.
As reported by the Bureau of Mines & Geosciences (BMG) in its year-end report, despite all odds the mining industry managed to post a minimal growth rate of 1.93% as total mineral production in 1990 improved to PP23.62 billion from PP23.17 billion in 1989. The metallic sector inched up by a mere 1.94% from PP17.29 billion to PP17.63 billion. Gold revenues contributed to 47.75% of the total, copper 44.71%, beneficiated nickel 3.89% and refractory chromite ore contributed 1.33%.
The non-metallic sector was able to achieve a modest gain as production values rose by 1.91% from PP5.88 billion in 1989 to PP5.99 billion in 1990. Improvements were reported by silica sand with 40.57% and bentonite with 33.35% value increases. Except for coal, almost all the minerals under the sector showed growth during the period under review.
However, total export earnings declined in both the metallic and non-metallic groups as the mining industry suffered a decline of some 16.05% and earnings dropped from $994 million in 1989 to $835 million in 1990. This was due to the decrease in production and generally lower average mineral prices.
The Chamber of Mines reported a 5.6% decline in copper production from its seven primary copper-producing members. Production was 182,139 t copper metal in 1990 compared with 193,000 t in 1989. This was attributed to the several natural calamities that beset Northern Luzon and Cebu during the year. A severe earthquake registering 7.7 on the Richter scale occurred on July 16, 1990, causing massive destruction of surface installations at the mines of Philex and Benguet. This was followed by strong typhoons which caused further damage. Atlas was hit by over 200 km/h winds of typhoon "Ruping" in November and reported major production interruptions.
Atlas Cons., with its two big openpit mines, a block-caving underground mine and two concentrators, is still the largest copper producer in the country.
From a total tonnage milled of 22.4 Mt at 0.40% Cu, some 73,900 t of copper-in-concentrate, 52,000 oz of gold and 265,000 oz of silver were produced. This was 6% lower than the previous year due largely to the effects of typhoon "Ruping", which hit Cebu in November and induced massive landslides, cutting off power for several days.
The Carmen underground project was reported to be progressing satisfactorily and is 43% complete. The decline tunnel has been completed, while the haulage level and grizzly level were 71% and 29% completed respectively. The company has embarked on a diversification programme to engage in areas such as foundry and engineering and construction services. The profit for the year was PP309.9 million from total revenues of PP6.089 billion.
Due to the relatively favourable copper price which persisted during the year, the mining of Marcopper's Tapian pit, which was supposed to be terminated by July 1990, was extended until year-end. However, this was at a reduced milling capacity, and materials milled included very low grades from stockpiles.
All the efforts of the company are now focused on the early completion of the San Antonio Project. There is a 200 Mt copper orebody grading 0.44% copper and 0.19 g/t gold. Due to earlier impounding of mill tailings above the orebody, dredging operations had to be undertaken and these have now been completed. Design and engineering work for the project is almost complete. Preliminary construction work is under way, including the new foundations for a 10,600 hp SAG mill. The company has reported that the project is scheduled to be completed and operational by the last quarter of 1991 at a rated mining and milling capacity of 30,000 t/d.
Benguet's Dizon copper-gold operations reported a slight reduction in tonnage milled and output. A hard-to-grind ore was encountered which necessitated the installation of a new crushing and screening plant to augment the SAG mill. The total tonnage milled was 5.6 Mt at 0.33% Cu and 1.06 g/t gold. Production was 16,424 t copper-in-concentrate, 137,000 oz gold and 202,000 oz silver. The 18,000 t/d operation is based on an openpit mine and a concentrator with on-line computer for process control.
Philex reported lower metal production due to the spate of calamities which occurred during the second half of the year -- the July 16 earthquake and the subsequent typhoons and very heavy rains.
The earthquake resulted in the cessation of operations for nine days and major damage was sustained. Approximately 15% of the residential facilities were either damaged or destroyed. The 22 km mountain road to Baguio City was devastated by numerous landslides, leaving the mine-site isolated for eight days. The subsequent typhoons and very heavy rains following the earthquake resulted in even more damage.
Copper production was down by 18%, gold by 26% and silver by 20%; production totalled 15,727 t of copper-in-concentrate, 68,000 oz gold and 85,000 oz silver. The mill treated 7.8 Mt at 0.256% Cu and 0.45 g/t gold. Ore reserves totalled 180.1 Mt at 0.28% Cu and 0.65 g/t gold.
Lepanto reported the same production as the previous year at 13,487 t copper-in-concentrate. However, the mine was isolated for about three months by the July earthquake and by subsequent typhoons. With the progressive decline in ore grades, emphasis is now being given to process more ore to maintain the same level of copper production. The use of LHDs underground has boosted productivity and reduced costs.
At the Far South East (FSE) Project, a Mine Production Sharing Agreement has been signed with the government for the operation of the mine leases covering the FSE orebody for a period of 25 years, renewable for another 25 years.
Site excavation for the shaft areas has started and the tailings dam construction commenced. Shaft sinking is scheduled to commence in October 1992 and production at 12,500 t/d will start three years later. The orebody is a deep-seated copper-gold porphyry located 1 km southeast of the Enargite mine. It has reserves of over 150 Mt at 0.80% Cu and 2 g/t gold. It is one of the three major orebodies identified in the area.
The National Economic Development Authority (NEDA) has approved the expansion project of the Philippine Associated Smelting & Refining Corp. (PASAR). The expansion will increase production of copper cathodes by 25% to 172,500 t/y from the present 138,000 t/y. Construction on turn-key basis, which will be handled by Outokumpu Oy of Finland, is scheduled for operation by March 1993.
The copper production in 1990 was 125,938 t against 132,193 t in 1989. This was primarily because of difficulty in getting green concentrates from its regular sources. PASAR also produced 202,000 oz gold, 942,000 oz silver, 399,000 t sulphuric acid and 48 t selenium. Total revenue for the year was PP2.75 billion with a net income of PP162.4 million.
Local gold production declined by 2.5% to 29,200 kg in 1990. Output of primary gold producers totalled 8,353 kg, secondary producers 10,685 kg and small-scale miners 10,117 kg.
Primary gold production fell by 14.5% due to the disruption of operations in the Benguet mines caused by the earthquake and typhoons. Three other mines reported either suspension of operations or closures -- Banahaw Mining, Surigao Consolidated and Benguet Exploration. Production of the copper-gold mines also fell by 16.1% due to the natural calamities.
Benguet remained the country's largest gold producer, although its production declined from 284,000 oz in 1989 to 251,000 oz. Output at its Benguet mine dropped due to the July earthquake and the subsequent typhoons. Tonnage output was down by 21.5% and gold production was down from 108,000 oz to 76,000 oz. The Dizon gold mines maintained gold output at 137,000 oz, primarily from better grades. This was despite a month-long labour strike.
At the Paracale gold operations, which became operational in 1982, the milling capacity has been increased to 675 t/d. In 1990, the ore feed came from three sources, namely underground 63,000 t, openpit 47,000 t and small-scale mine tailings 92,000 t. The Antamok Gold Project is reportedly 35% complete. It will be an openpit operation mining the surface extensions of the four major gold veins previously mined underground. The 3,000 t/d mill will operate with a SAG mill and CIP circuit.
Benguet is now exploring at the Kingking copper-gold and Zamboanga gold prospects. The Kingking exploration started in December, with diamond drilling being carried out by Nadecor, the claim owner which signed up with Benguet in an operating agreement. This prospect is similar to the Dizon copper-gold mine. The Zamboanga gold prospect has two drilling targets; the first indicates gold occuring along a 6 m-wide zone with a marginal grade of 2.2 g/t gold; the second target shows better mineralization but, due to the pressure of many small-scale miners in the area, drilling has been held in abeyance.
The Masbate Gold operations of Atlas Cons. reported record gold production at 87,000 oz from 1.31 Mt of ore with an average gold grade of 2.162 g/t. Development shifted to the underground mines at Bin Star, Colorado and Dabu-Panique, where 17,000 m of development has been completed. Collaring work was completed in the vertical shaft that would be driven to serve both Dabu-Panique and Bin Star mines. Shaft sinking will commence in the second quarter of 1991.
Despite the July earthquake in the Benguet area, Itogon-Suyoc was still able to maintain its gold production at 16,400 oz. This was achieved by milling 134,000 t ore at 4.391 g/t gold.
Manila Mining reported a 33% increase in its gold production from the previous year to 11,100 oz. The expansion from 1,000 t/d to 2,000 t/d on the heap-leach was completed in October. This involved an agglomeration combined with a custom-classified agglomerated ore conveyor system feeding directly to the leach pads. The heap-leach pad height of 6 m has set a new standard in the Philippines. The conventional cyanide mill was converted to a full CIP/CIL circuit during the second quarter. The mineral reserves have been substantially increased to 7.03 Mt at 1.69 g/t gold.
Philex has entered into an operating agreement with Bulawan Mining Corp. The Bulawan orebody, located in Sipalay, Negros Occidental, has reserves of 9.1 Mt at 3.1 g/t gold. It is a relatively deep-seated disseminated gold orebody that will be mined underground. Metallurgical tests and conceptual plant design for a 3,000 t/d CIL plant are being undertaken by BHP International of Australia.
Philnico Mining & Industrial Corp. finally signed a definitive agreement with the Asset Privatization Trust (APT) for the acquisition of the Nickel Project of Nonoc Mining & Industrial Corp. Under the terms of the agreement, the $325 million purchase price will be paid in its peso equivalent, less the PP105 million deposit made by the Cabarrus group and the $70 million liabilities of Nonoc. International Finance Corp. showed interest in providing the financial requirements of the project, after a study prepared by Wright Engineers which indicated its viability.
Oil and Coal
The Office of Energy Affairs (OEA) reported that production reached a total of 1.7 Mbbl, against 1.88 Mbbl in 1989. Current production is 4,700 bbl/d coming from the five fields located at north-west Palawan. Only the North Matinloc field showed an increase from its previous production of 602,000 bbl to 730,000 bbl.
Oil exploration remains active and has been highlighted by the major oil discovery made by Alcorn towards the year-end. This was the well West Linapacan-1 in the deep waters of northwest Palawan. It is estimated conservatively to contain a recoverable reserve of 100 Mbbl of oil from a 1,000 Mbbl of oil-in-place within a Lower Miocene reservoir. Development plans are expected to be finished by the first quarter of 1991.
More foreign companies have entered oil exploration, including Shell Exploration BV, British Petroleum, Atlantic Richfield and Phil-Canadian Hunter Inc. Only five wells were drilled, however, during the year, three onshore and two offshore. The state-owned Philippine National Oil Co. -- Exploration Corp. (PNOC-EC) drilled two non-commercial oil discovery wells in Cebu. A group of Filipino oil companies, under the operatorship of Vulcan-Anglo, drilled one well in Central Luzon and had minor gas shows. Aside from the West Linapacan-1 well, another offshore well, Octon-1, was drilled and was scheduled to be completed by mid-January 1991.
Occidental has conducted feasibility studies on the development and commercial production of its Comago gas discovery, which is estimated to contain 30 billion [m.sup.3] of gas. Together with Shell, Occidental has presented the results of the study to the government. The contractors have concluded that to be able to exploit the gas resources in the area, a minimum of 120-140 billion [m.sup.3] must be proved.
Coal consumption at 2.22 Mt is slightly up compared with the previous year at 2.1 Mt. Coal production at 1.24 Mt in 1990 was also slightly lower than 1989 at 1.33 Mt. Lower production was reported by the major coal producers -- Semirara Mining 553,000 t, PNOC 267,000 t, Cebu small-scale miners 176,000 t and others 198,000 t.
PHILIPPINE MINERAL OUTPUT
(t unless otherwise stated)
1988 1989 1990 Gold (kg) 32,486 29,992 29,234 Silver (kg) 54,727 50,630 47,518 Copper-in-concentrate 218,202 192,990 182,139 Zinc-in-concentrate 1,569 2,459 113 Nickel ore 532,898 658,405 608,115 Chrome ore 182,242 247,705 234,621 Manganese ore 670 3,002 14,583 Cement (000 t) 4,300 6,050 6,300 Coal (000 t) 1,330 1,330 1,240 Silica sand 177,304 184,890 292,524 Bentonite 1,562 5,961 16,484
A. F. Disini, Senior Vice-President, Lepanto Cons. Mining Co.
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|Title Annotation:||review of Philippines' mineral mining industry in 1990|
|Date:||Jan 1, 1991|