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Oriental Peninsula to start Palawan mining


INQUIRER.net
First Posted 09:16:00 05/30/2010

Filed Under: Mining and quarrying

MANILA, Philippines?The mining subsidiary of publicly-listed Oriental Peninsula Resources Group (ORE) will soon commence nickel mining operations in Palawan with the fourth quarter of 2010 as the target schedule for its first ore shipment.

In a statement shortly after ORE?s annual stockholders? meeting Friday, company chairman and president Caroline Tanchay said barring last-minute legal and weather hitches, its subsidiary Citinickel Mines and Development Corp. could start mining operations as early as July and ship ore by December.

Tanchay said Citinickel, which has been locked in a legal tussle with mining operator Platinum Metals Group Corp. (PGMC) over the firm?s mining concession in Palawan, is close to settling the legal row which will allow it to finally start operating its nickel mines in Pulot and Toronto.

?If this finally pushes through, we forecast that we can make our first ore shipment by the fourth quarter of this year and hope to be cash-flow positive by the end of our fiscal year,? Tanchay said.

As this developed, ORE shareholders approved plans to acquire a majority stake in Oriental Energy and Power Generation Corp., marking the firm?s diversification into the renewable energy business.

?With the world reeling from climate change and global warming? there is a growing bias for environmentally sound business ventures. Even governments around the world are giving great importance and priority to clean, socially responsible, and sustainable sources of energy,? Tanchay stressed.

Oriental Energy recently secured the green light from the DENR to start construction of its P2.5 billion, 18-megawatt hydropower project in Madalag, Aklan?the first of five mini-hydro facilities set for development.

Aside from its Aklan project, Oriental Energy has four other service contracts which include the Culaman runoff river hydro-electric power project in Manolo Fortich, Bukidnon and three service contracts for the upper, middle, and lower cascades of the Odiongan River in Odiongan, Misamis Oriental. The five projects have a combined generation capacity of 55 megawatts.

Tanchay said the mini hydropower projects were being pursued to help ease the acute power shortage in the Visayas and Mindanao without depending on expensive and pollutive fossil fuels.

In December 2009, shareholders of ORE approved the change in the listed firm?s primary purpose to include power generation and natural resources development. At the same time, ORE approved an increase in its capitalization and a stock rights offering to raise as much as P600 million to fund the purchase of a 40 percent equity in Oriental Energy.

In December 2008, ORE went public in the Philippine Stock Exchange, the first metal mining company to do so in 24 years. Following its successful listing by way of introduction, ORE spent part of the IPO proceeds to purchase equipment, build roads, bridges, and a wharf, including laboratory facilities for Citinickel?s operations. However, the protracted legal battle with PGMC stalled the company?s plans.

For over three years, Citinickel has locked horns with PGMC, the mining operator of Citinickel?s predecessor, Olympic Mines and Development Corp. Olympic cancelled its mining contract with PGMC due to alleged over-extraction and other environmental violations.

In 2007, Citinickel secured a 25-year Mineral Production Sharing Agreement (MPSA) from the Department of Environment and Natural Resources (DENR), allowing the company to develop the 2,176-hectare Pulot and Toronto mines in southern Palawan.



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