Philex Mining to build new tailings pond in Padcal


Posted at Sep 24 2012 01:15 PM | Updated as of Sep 24 2012 09:15 PM

MANILA, Philippines - Philex Mining Corp. said it will build a  new tailings pond for its Padcal gold mine in Benguet. 

In a disclosure to the stock exchange, Philex said the new tailings pond will replace the current Tailings Pond 3 (TP 3), which leaked waste in August. 

"Construction of the first new tailings ponds will be put underway as soon as possible, even as the tunnel of Penstock A of TP3 is to be concreted and condemned to prevent further tailings leakage from the tunnel," the company said. 

Philex said the discharge of cleaner  water from the tunnel of the tailings pond has been significantly reduced, after concrete spheres were dropped to plug the sinkhole and to prevent tailings from leaking out. 

"More boulders and gabions will be dropped into the sinkhole until the discharge has been completely stopped, at which time inspection of the tunnel will be made to locate the source of the leakage, determine the appropriate measures to permanently plug the sinkhole and seal the tunnel completely by concrete," the company said. 

Philex's Padcal mine will remain suspended until the safety of the tailings pond has been assured, the company said. Earlier, Philex Mining chairman Manuel V. Pangilinan said the mine may be closed until the end of the year. 

As a result of the mine leak, the mining company said its net income budget for the year has been lowered from P4.8 billion to P1.7 billion. 

"The revised budget is before any significant costs and expenses related to the repair of the tailings pond and cleaning up of the tailings leakage, and any fines and penalties that may be lawfully imposed on the company, less any recovery from the company's pollution liability insurance cover," Philex said. 

Last August 1, a tailings leak occurred at a pond at Padcal mine, causing mine waste to flow in a creek connected to the Agno river. Several more leaks were reported in the next few weeks.  It has taken the company a more than a month to stop the leak.

The Padcal mine was ordered closed until further notice by the government. Philex is also facing close to P1 billion in fines due to the leak.