MGB shelves mining permit for King King project

The Mines and Geosciences Bureau (MGB) has put on hold the evaluation of the mining permit for the proposed $2 billion King King copper-gold project in Campostella Valley pending the resolution of the intra-corporate dispute within tenement owner Nationwide Development Corp. (Nadecor)

MGB Director Leo Jasareno said the MGB in Region XI has suspended the evaluation of the Declaration of Mining Project Feasibility (DMPF) for the project until the legal dispute for company control between two Nadecor factions has been resolved.

The DMPF is a document containing an assessment on the commercial viability of deposits. Securing the DMPF is the final step to commencement of operations.

Nadecor, as the holder of the mineral production sharing agreement (MPSA) for the tenement has partnered with US-based miner St. Augustine Gold & Copper Ltd. as its contractor in developing the mine.

“The DMPF of Nadecor is still pending with the MGB regional office but we have suspended the processing until the intra-corporate dispute is resolved,” said Jasareno said.

“If we approve the DMPF, they can begin mining but then who will mine the deposits? So they should first resolve the dispute,” he added.

A group of shareholders in Nadecor led by Jose Ricafort is challenging the legitimacy of the current board led by Conrado Calalang.

The Court of Appeals in a decision dated Feb. 18, 2013, upheld the legality of the election of the current board composed of Roberto R. Romulo (chairman), Conrado T.Calalang (president), Leocadio Nitorreda (COO and general counsel), Alfredo I. Ayala, Juan Kevin G. Belmonte, John Engle and Peter Mutuc.

Representatives of St. Augustine, Tom Henderson and Kee Ming Chi were also elected to the Board.

The Ricafort faction is appealing the case before the Supreme Court. Calalang, however, earlier expressed confidence that the appeal would be rejected.

The Ricafort group includes Jose de Jesus (president and director); Antonio Henson (treasurer and director); Deogracias Contreras Jr. (corporate secretary and director), Ethelwoldo Fernandez, Victor Lazatin, Ruy Moreno, Angel Ong, and Teodorico Taguinod, directors; and Lemuel Santos (assistant corporate secretary).

Jasareno said the concerned parties have been informed of the suspension of the processing of the permit.

“Technically, (the King King) project is one of the most attractive (proposed) mining projects because it has a world-class deposit and a large investment. But then, it is mired in intra-corporate dispute,” said Jasareno.

The King King copper-gold project is expected to produce 3.1 billion pounds of copper and 5.43 million ounces of gold over its 22-year mine life.

Calalang similarly expressed confidence that the intra-corporate dispute would be resolved in their favor.