Resource Investor: Change in Philippines Investment Climate Aids Mindoro

Change in Philippines Investment Climate Aids Mindoro
By Derek Moscato
31 Jan 2005 at 11:49 AM EST

VANCOUVER (ResourceInvestor.com) -- Surging interest in Asia-Pacific mining plays helps Edmonton-based Mindoro Resources be loud and proud when talking up its Philippines gold and gold-copper projects. Yet some skeptics say that the country isn’t ready for prime-time investment just yet.

Mindoro’s three projects comprise Batangas, a 14,000 hectare land package within a gold-copper belt; Surigao, a 24,000 hectare land package where the company has paired off in a $2 million exploration joint venture with Panoro Minerals; and Pan De Azucar, a smaller land package where drilling has encountered copper, gold, zinc and silver.

On the upside for Mindoro, an improving investment climate in the Philippines is being matched by an improving political climate. In a majority decision this past December, the Supreme Court of the Philippines confirmed the legality of the 1995 Philippone Mining Act, which allows for 100% ownership of large mining projects (those greater than US$50m investment).

According to Tony Climie, president and CEO of Mindoro, “The Philippine's geological potential has never been in dispute. Now, with foreign ownership uncertainties removed, we are very pleased to be at the forefront of the dawn of a major mining industry in the Philippines."

Mindoro VP Penny Gould echoed that sentiment in an interview with Resource Investor, and the positive ramifications it could have for the company. “We've been there since 1996, and we've seen many changes, particularly in the past few years,” she said. “In Australia, they've recognized the opportunity there far earlier than we here in North America have.”

Big in Germany

Shares of Mindoro, which trade on the Toronto Venture Exchange, currently trade hands at roughly C$0.27, with a 52-week range of $0.18 to $.40.

The company is hoping that its new listing on the Frankfurt Exchange will create a stronger investor base and a higher international profile. "Listing on the Frankfurt Stock Exchange will greatly increase the profile of Mindoro with both private and institutional investors across Europe," said Climie in an issued statement

According to Mindoro chairman Gerhard Kirchner, an Austrian national who speaks German and travels to Europe often, the company is garnering strong interest there. “We are the most traded junior company on the Frankfurt Stock Exchange,” he told Resource Investor.

It’s also a less-saturated market in terms of junior miners, says Gould. “In North America, if you look around at this conference, you are one of hundreds.”

And the extra interest in Germany is impacting the company’s business model in Canada. “Demand out of Frankfurt has increased the interest back here on the Venture Exchange,” she says.

It’s also hoped that an advisory board created this past summer will enhance the company’s profile in North America and beyond. The advisory board members are Terry A. Lyons, chairman of Northgate Minerals, and Michael Jones. CEO and director of Platinum Group Metals.

In addition, they’re counting on guidance from company director Oscar Reyes, who might help Mindoro navigate the sometimes tricky bureaucratic and business waters of the Philippines. Reyes previously served as top boss for the Philippines outpost of Shell Oil, and oversaw the offshore Malampaya oil and gas project that was brought into production in that country in 1998.

His presence might also help sway otherwise cautious investor who are still cold on the Philippines, especially after a recently released business survey conducted jointly by Asian Development Bank and World Bank. The report, entitled Moving Toward a Better Investment Climate, cites some major challenges and concerns in the country, including weak macroeconomic fundamentals, corruption, infrastructure issues, and excessive business regulations.