Philex Mining Corporation, one of the oldest and largest gold and copper producers in Southeast Asia, reported a drop in core net income to P864 million for the first nine months of 2023 from the P1.54 billion earned in the same period last year as its Padcal mine nears depletion.

In a disclosure to the Philippine Stock Exchange (PSE), the firm said core net income for the third quarter was also lower at P163 million from P210 million in the same period last year.

EBITDA of P337 million for the third quarter of 2023 was lower compared to the P611 million EBITDA for the same quarter of 2022 while the nine-month EBITDA of P1.53 billion was lower compared to P2.96 billion of in 2022.

Gold and copper prices remained within similar levels as those of the second quarter of 2023 at $1,927 per ounce and $3.73 per pound, respectively, but higher at 13 percent and three percent, respectively, compared with the third quarter 2022 prices of $1,701 per ounce for gold and $3.61 per pound for copper.

Philex milled a total of 1.69 million tons during the third quarter of 2023, lower than the 1.87 million tons milled in 2022 and the 1.83 million tons milled in the second quarter of 2023.

Total tonnage milled for the first nine months of 2023 was at 5.23 million tons, slightly lower than the 5.55 million tons in the same period last year.

Ore grades for gold and copper for the third quarter of 2023 are opportunistically almost the same when compared with the same period in 2022, as well as with the second and first quarters of 2023.

Gold output for the third quarter of 2023 dipped to 8,775 ounces, lower than the 10,300 ounces of the second quarter of 2023 and the 12,144 ounces of the third quarter last year.

Copper output for the third quarter of 2023 at 5.22 million pounds was also lower than the 5.64 million pounds of the second quarter of 2023 and the 6.38 million pounds in the third quarter of 2022.

Total gold output for the first nine months of 2023 stood at 29,136 ounces while copper output was at 16.4 million pounds, lower by 22 percent and 14 percent, respectively when compared with the same period in 2022.

Development works continue on the Silangan Copper and Gold Project in Surigao del Norte with the ongoing tunneling works, breaching more than 35 percent of the distance towards the ore body.

Clearing works and access road to the tailings storage facility (TSF) area are nearing completion with the issuance of the permit by the Municipality of Sison, Surigao del Norte for the construction of the TSF.

Management is set to award the general contract works for the tailings storage facility as well as the process plant EPCM or EPC contractor this November 2023. Likewise, the project footprint area had been secured.

Philex President and CEO Eulalio B. Austin Jr. said that, aside from exploring the vicinity of Padcal Mine, the Company is also studying the viability of exhausting reserves in the Padcal under the current drain tunnel, which could again extend Padcal’s mine life beyond 2027. The drain tunnel services all the water from the mine towards the TSF.

“If the study yields positive results, this could further extend Padcal’s mine life beyond 2027. Hopefully, we can have the initial results by the end of the year,” Austin said.

He added that at Silangan, "we are progressing with the driving of the decline to access the ore body which we expect to reach by the second half of 2024.”

According to Philex Chairman Manuel V. Pangilinan, the company is also looking at expanding into nickel mining to meet the increasing demand of the mineral by the electric vehicle industry.

“We are prospecting for nickel resources to develop in this country because the future for electric vehicles is bright, so we have to be in well-positioned for this opportunity,” Pangilinan said.