The Asia Miner

OCT-DEC 2016

The ASIA Miner - Reporting Important Issues to Mining Companies in the Asia Pacific Region

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Volume 13 • Issue 4 | 2016 | ASIA Miner | 37 Philippines MACO Gold Project in the Compostela Valley of Mindanao estab- lished a new daily record by producing an average of 1525 tonnes of ore by the end of June . This surpassed Apex Mining's targeted daily production of 1500 tonnes . Output increased by 34% in the June quarter to 203,476 tonnes of ore from 152,136 tonnes in the same period of 2015 . During the quarter the mill averaged close to 1400 tonnes of ore per day, up from 1100 tonnes of ore per day in the same quarter of 2015 . The improved throughput is a result of continuing efforts to attain Apex's objective of milling at the rate of 1500 tonnes per day by the early part of the second half of 2016. This objective was, however, achieved by the end of June . Despite lower ore grades in the June quarter of 5 . 0 grams/tonne (g/t) gold and 31 . 7 g/t silver compared to 5 . 6 g/t gold and 32 . 4 g/t silver 12 months earlier, the higher tonnage resulted in new record levels of metal outputs . Gold production reached 26,577 ounces, 31% higher than the 20,334 ounces produced in 2015 while sil- ver produced was 140,317 ounces, 31% higher than the 107,036 ounces produced in 2015 . Mill recoveries averaged 81% for gold and 68% for silver in the quarter compared to Q2 2015 recoveries of 78% and 65% . This also contributed to the higher metal outputs . The Maco mine is securing its ISO 14001 certification, with the first stage of the review of the mine's processes completed in July with the second stage scheduled for mid-August . The audit by the Department of Environment and Natural Resources was conducted from August 4 to 7 . In May the company's 98%-owned subsidiary Itogon-Suyoc Re- sources made its first shipment of 558 ounces of incidental gold produced in the rehabilitation of the Sangilo mine in Itogon, Ben- guet . Since Apex's acquisition of this subsidiary in June 2015, re- habilitation of the Sangilo mine has progressed with the mill set to run at the initial rate of 75 tonnes a day . "While this is still way below the 1400 tonnes per day operation that the mine is gearing itself to achieve in 2019, it is solid proof of the engineering capability of the mine's technical staff to make the mine fully operational in due time," said Apex president and CEO Walter Brown . RENEWAL of the Mineral Production Sharing Agreement (MPSA) for St Augustine Gold and Copper Limited King-king Copper-Gold Project in southern Mindanao has been approved by The Mines and Geosciences Bureau (MGB) of the Philippines . The renewal is for 25 years and was awarded to St Augustine's joint venture part- ner, Nationwide Development Corporation (NADECOR) . The MPSA is an agreement under which the Philippine Govern- ment grants an exclusive right to conduct mining activities within the contract area and the government receives a share of the gross revenues of the mine operations . TSX-listed St Augustine, through NADECOR, will provide the nec- essary financing, technology, management and personnel for King- King's development, construction and operation . With the earlier approval of the Declaration of Mining Project Fea- sibility (DMPF), NADECOR and St Augustine will work cooperatively to advance the project to construction followed by operation of the mine . Development of King-king is expected to have positive im- pacts for all project stakeholders and the community at large, and has been designed to minimise any environmental impact . The DMPF approval was achieved subsequent to receipt of an Environmental Compliance Certificate and represents five years of comprehensive technical, environmental, social and community en- gagement efforts by NADECOR, St Augustine and related advisors . NADECOR has also been issued its Certification Precondition from the Philippine National Commission on Indigenous Peoples . St Augustine's president and CEO Paolo A Villar said, "The suc- cessful renewal of the MPSA represents another milestone in our ongoing efforts to advance and de-risk the King-king project. With all major mine permits approved, the MPSA renewal now paves the way for the next phase of King-king's development . " The King-king project is in Compostela Valley and is expected to recover 3 . 16 billion pounds of copper and 5 . 43 million ounces of gold over its 25 year mine and process life . It is one of the largest undeveloped copper-gold deposits in the world, and is listed as a top three-priority mining project by the Philippine government. According to a preliminary feasibility study released on September 18, 2013, the project has a pre-tax NPV of $2.0 billion with an IRR of 24 . 8% . The estimated mineral reserves amount to 617 . 9 million tonnes at 0 . 30% total copper and 0 . 395 grams/tonne gold . Maco sets daily Maco sets daily tonnage record tonnage Maco sets daily tonnage record record King-king King-king MPSA renewed for 25 years MPSA renewed for 25 years King-king MPSA renewed for 25 years A view over the site that hosts the King-king copper-gold deposit in southern Mindanao .

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