Western Australian miner Tribune Resources has acquired 100 per cent of Prometheus Developments, which owns the high-grade Diwalwal gold project in the southern Philippines.
Prometheus holds an 80 per cent economic interest in three tenements at Diwalwal, which is around 40 kilometres from Medusa Mining’s Co-O gold mine, Australian Mining reported.
The Philippines is a mineral-rich nation but it is still unusual for Australian mining companies to enter the country, particularly after President Rodrigo Duterte declared last year that he wanted to stop overseas processing of minerals extracted in the country.
Tribune issued Prometheus 5.5 million shares at a price of $4.50 per share for a total of $24.75 million, in addition to a $US4 million ($5.5 million) cash payment to purchase Diwalwal.
Director Gordon Sklenka believes Diwalwal ticks all the right boxes for Tribune, which expects to start drilling at the project in 2019.
“The project has secure tenure, excellent grades, prospective geology and the potential for the delineation of a very large gold deposit,” Sklenka said.
Sklenka said strong incomes from Tribune’s East Kundana joint venture in the Eastern Goldfields region of Western Australia with Northern Star Resources and Rand Mining had allowed the company to assess “meaningful acquisitions” that could transform the company into “a significant mining house”.
Tribune enters the Philippines 18 months after the industry experienced upheaval under Duterte’s guidance.
“You have to come up with a substitute, either spend to restore the virginity of the source or I will tax you to death,” Duterte said in reference to the mining industry in July 2017.
Prominent Filipino environmentalist Gina Lopez, an ally of Duterte, suspended and shut down 26 mines and cancelled the approval of 75 more during her 10 months as the director of the Department of Environment and Natural Resources (DENR) before being replaced by the more moderate Roy Cimatu in May 2017.
One Australian-owned project that fell foul of this period was OceanaGold’s Didipio gold-copper mine. The company fought against its suspension and was eventually able to maintain operations and went on to achieve a record company profit for the 2017 financial year across all operations.
The Philippines is also the second-biggest producer of nickel ore in the world after Indonesia, although recent regulation introduced by the DENR that will limit land rights for smaller producers is expected to lower production in 2019. Thirty of the 50 mines operating in the country are nickel mines.