Name and Location
Tampakan copper/gold project, southern Mindanao, the Philippines.

Client
The project is operated by Philippine-based affiliate Sagittarius Mines Incorporated (SMI), whose 40% controlling equity is a joint venture between Glencore Xstrata (62.5%) and Indophil Resources (37.5%).

Project Description
The Tampakan deposit represents one of the largest undeveloped copper/gold deposits in South-East Asia. The current project borders on four provinces – South Cotabato, Sultan Kudarat, Sarangani and Davao Del Sur.

The project is a 2.94-billion-tonne deposit, containing 15-million tonnes of copper and 17.6-million ounces of gold at a 0.2% cutoff grade.

The prefeasibility study on the development of the project outlined a potential 20-year mining operation, based on an average copper production of 375 000 t/y and gold production of 360 000 oz/y over a 17-year mine life.

Value
The initial stage-one capital outlay for the project is estimated at $5.9-billion, including provision for associated infrastructure.

Duration
The project has been delayed to 2019. The project was originally expected to start production by 2016.

Latest Developments
Sagittarius Mines has “pressed the reset button” on the project.

It has announced a revised work plan for the project to secure government support on key bottleneck issues before proceeding to final valuation and possible development.

The revised work plan follows a project review, which investigated the issues and challenges facing the project, including the resolution of the South Cotabato openpit mining ban, the definition of the pathways to project approvals from all levels of government and gaining consent to resettle impacted communities.

The company notes that the change in plan is “timely” and aimed at giving the Tampakan project the opportunity to progress in a reasonable timeframe.

Sagittarius has warned that the plan will reduce the current activity levels of and expenditure on the project, subsequently resulting in job cuts.

Sagitarrius remains in discussions with project partner Glencore Xstrata regarding specific areas of revised work, adding that a range of on-the-ground programmes, designed to advance social-licence-to-operate criteria, could be separately supported by Indophil, while the company works with the government to redefine and reset the pathway to project approval.

The Tampakan project, which is majorly held by diversified miner Glencore Xstrata, contains an estimated 2.94-billion tons of mineral resource, containing about 15-million tons of copper and about18-million ounces of gold.

Key Contracts and Suppliers
Bechtel (lead engineer for the feasibility study).

On Budget and on Time?
The project has experienced several challenges since Sagittarius Mining submitted its mine project feasibility study. These have included restrictions on field activities, resulting from security issues in the project area; the need to reconsider preferred power supply options for the project; the ongoing uncertainty created by a provincial ordinance that is in conflict with national law; and the denial of the Mine Environmental Compliance Certificate by the Philippine Department of Environment and Natural Resources.

Contact Details for Project Information
SMI, tel +63 83 2271043, fax +63 83 2271045 or email info@smi.com.ph.