Philippine Open-Pit Ban Threatens Xstrata Project

1 July 2010 (Last Updated July 1st, 2010 18:30)

A southern Philippine province has approved a ban on open-pit mining in the area, threatening a $5.2bn Tampakan copper-gold project majority owned by Xstrata. South Cotabato province governor Daisy Avance-Fuentes approved the ban, according to Reuters. Avance-Fuentes said the mini

A southern Philippine province has approved a ban on open-pit mining in the area, threatening a $5.2bn Tampakan copper-gold project majority owned by Xstrata.

South Cotabato province governor Daisy Avance-Fuentes approved the ban, according to Reuters.

Avance-Fuentes said the mining law does not allow open-pit mining, which can harm rivers that irrigate farms and could therefore displace villagers.

Xstrata Philippine's affiliate Sagittarius Mines said the ban is disappointing.

"We remain concerned regarding the code's potential impact on the Tampakan project and will continue to monitor this issue closely and consider our available options," Sagittarius Mines general manager Mark Williams said in a statement.

The Tampakan project, considered South East Asia's largest undeveloped copper-gold prospect, is estimated to contain 13.5 million tons of copper and 15.8 million ounces of gold.

Last week, China's Zijin Mining withdrew a takeover offer for Indophil Resources, which owns about a third of the Tampakan mine, over the threat of a ban.