Canada’s TVI Pacific said on Friday it is considering moving the planned listing of its local unit at the Philippine Stock Exchange by another year because of low metals prices and uncertainties caused by government’s mining policy.
Clifford James, TVI president and chief executive officer, said that it would be difficult for TVI Resource Development Philippines Inc. (TVIRD) to push through with its initial public offering this year – unless there is favorable development in the country’s legislative environment and rapidly falling metals prices starts to back up.
“There’s no panic. We want to list at some point . . . but there’s a number of things that we want to see before we list,” James told reporters during Philippine Mining Club Luncheon at the Polo Club in Makati.
“Right now, I will not be advising to the (TVIRD) board the IPO. We will list when it makes sense to us,” he said.
TVIRD planned to get listed at the local burse by fourth quarter of 2015 as potential source of funding to finance exploration and development of its major projects in the country.
Should the company push through with the IPO later this year, James said the funds raised will be used for working capital, particularly for the construction of a nickel processing plant in Agatam Agusan del Norte and acquisitions of some projects.
“Again, we’re not committed to any particular timeframe. We don’t need the money but it would be nice to have the money to hasten growth,” he said.
TVIRD is currently producing nickel laterite ore at the Agata project, and is building a nickel processing plant. TVIRD owns 60 percent of Agata Mining Ventures Inc (AMVI), with Mindoro Resources Ltd holding the remaining stake.
Besides the Agata project, TVIRD is completing permits for the Balabag gold-silver project in Zamboanga del Sur. The company is working towards its Declaration of Mining Project Feasibility (DMPF), the final requirement before production can start.
In his speech during the Philippine Mining Club Luncheon, James discussed ongoing industry challenges, particularly Executive Order 79 or the Aquino administration’s mining policy, which is gearing towards higher taxes for the mineral sector.
He said while the Philippines’ current mining law already imposes heavy taxes on the mining industry, it is nonetheless an example of world-class legislation that clearly delivers on the triple bottom line – the economy, the people and the environment.
He said an unwarranted and onerous increase in taxes “will run the risk not only of reducing foreign direct investments and economic growth potential, but also of capital flight and an overall downtrend for the industry.”
On the topic of unprocessed ore, James indicated that a unilateral ban on exports would ultimately remove the possibility of establishing processing facilities.
In the case of TVIRD, it is the DSO business that generates cash flow that will ultimately fund the potential construction of its nickel processing plant. In this equation, implementing a ban will eliminate the establishment of processing plants instead of paving the way for them,” he said.
“TVIRD supports the government’s vision for an industrialized Philippines. In fact, it is inherent for every mining company to support this development as metals, machinery and the extractive industries play a focal role in industrialization,” James said.
“We have confidence that the Philippine government and our industry will come to a mutually-agreeable framework to ensure sustained economic growth in the future while ensuring the protection of people and the environment,” he said.
TVIRD was the first foreign-invested mining company to receive the license to operate under the Philippine Mining Law of 1995. James Konstantin Galvez