As if to exploit the current national preoccupation on the anomalous NBN-ZTE deal, MGB chief Horacio Ramos timed his 'official' announcement of KORES as Lafayette's financial savior at a time when public attention is hopefully diverted somewhere else. We say official because the DENR's website already carried in early February evidence of this DENR-Kores-Lafayette collusion.
A word of caution to corrupt government and Lafayette officials: deeds done in the dark tend to haunt their doers for a long, long time. You think you can cook up another anomalous deal under cover of another anomalous deal? You think you are high and mighty now? But you never know for the winds they are a-changing...
Lafayette in talks with Kores to sell Philippine mine
MANILA, Feb 19 (Reuters) - Lafayette Philippines, a unit of Australia's Lafayette Mining (LAF.AX: Quote, Profile, Research), is in talks to sell its copper and gold mine to partner Korean Resources Inc (Kores), a government official said on Tuesday.
The director of the Mines and Geosciences Bureau told reporters that Kores was conducting due diligence on Lafayette's central Philippine mine, which was shut for over a year after cyanide spills in 2005, pushing its parent group close to bankruptcy and tripping up foreign investment in the sector.
"From what Kores told me, Lafayette is asking for 100 million pesos ($2.47 million)," Horacio Ramos said, without providing further details. "But I'm told the two firms are still haggling." Bayani Agabin, Lafayette Philippines vice president and legal counsel, did not confirm negotiations with Kores but said the firm was in talks with investors from Korea, Singapore, the United States and Malaysia.
"I can't identify the investors we are talking to," Agabin said. "Any investor will have to put in fresh funds to provide for additional operating capital for the company."
State-run Kores and South Korea's LG Co International Ltd (001120.KS: Quote, Profile, Research), which holds a supply agreement with Lafayette, together own 26 percent of Lafayette Philippines. The Australian parent owns the rest.
Agabin said the Australian firm was ready to either sell out of the project or retain a minority stake, depending on the buyer.
Lafayette was the first foreign firm to operate a mine in the Philippines after a law granting full foreign ownership of local mining projects was upheld by the courts in late 2004.
But it entered voluntary administration in December to avoid bankruptcy and fix its finances.
The Rapu Rapu mine was forecast to generate revenues of $350 million a year from annual production of 10,000 tonnes of copper in concentrate, 14,000 tonnes of zinc in concentrate, 50,000 ounces of gold and 600,000 ounces of silver.
The mine facility, which resumed operations in February last year after its suspension, is operating at just over half of its daily processing capacity of 3,000 tonnes of ore, Agabin said. ($1=40.55 Philippine Peso) (Reporting by Rosemarie Francisco; Editing by Carmel Crimmins and Jacqueline Wong)