Miner to spend P600M for exploration in Leyte

published February 03, 2011 in BusinessWorld

TACLOBAN CITY -- Northern Access Mining, Inc. will spend up to P600 million for its exploration activities in five Leyte towns.
Silvestre Jeric E. Lapan, Northern Access general manager, said half of this amount, or P300 million, has been programmed for this year.

“That’s the requirement to run a small land. If we will scale up our operation to a bigger capacity, it will be doubled in the following years,” Mr. Lapan told BusinessWorld.

A mineral production sharing agreement (MPSA) allows the company to explore 50 mining blocks straddling the municipalities of Tanauan, Tolosa, Dulag, Julita, and Tabon Tabon in Leyte.

“We are now in Dulag. We’ve just been done with our exploration in Tolosa. We’re just continuing our exploration in some other areas and we have promising results so far,” Mr. Lapan said.

Northern Access started exploration activities for magnetite sand in 2008. The company initially invested P200 million and is targeting to produce 1.2 million tons per year of titano-magnetite iron ore.

In Tolosa area alone, which comprises 25% of the firm’s mining claim, there are about three million tons of concentrate, Mr. Lapan said. Julita and Tabon-Tabon are not coastal towns but these are covered by the mining firm’s MPSA because of the presence of sand.

From 1969 to 1976, Inco Mining operated a magnetite mine and processing plant in Tolosa that produced 750,000 tons of magnetite every year for Japanese steel manufacturers. Inco has since ceased operations.

“There were good indications in the past. This exploration activity is just a validation of past findings,” he said.

Northern Access signed an operating agreement with ECA Philippines, the MPSA holder, in September 2008 and continued the exploration and development program and mineralogical studies.

Mr. Lapan did not give a timetable for the completion of their exploration activities.

“It will take us years to complete. No definite time because a lot of factors will dictate the speed of our exploration,” he added.

If they are successful in Leyte, Mr. Lapan said they will consider expanding to other provinces. The company is looking at exploring Cagayan Valley and some areas in Mindanao.

“We want the Leyte project to become a highlight of what will be done in other areas. We want to establish the company’s credibility,” he added.

Magnetite is a magnetic and very dense mineral of iron that is in demand especially in China. It is an important source of iron for the iron and steel industries.

Aside from magnetite sand, Leyte also has deposits of copper, iron, bentonite, nickel, limestone, peat, and dolomite. -- Sarwell Q. Meniano