Glencore to resume Philippine copper ops by mid-year

Philippine Associated Smelting and Refining Corp (PASAR), majority owned by Glencore, shut in January after a fire razed its facility in the central Leyte province, destroying anti-pollution devices.

"Our people are now busy refurbishing the plant because we want it to be in top shape when we operate by middle of this year, in June or July," said J. Paul Tan, PASAR assistant vice president for industrial and community relations.

Tan could not give any estimate on foregone revenue from the halt in copper processing and exports, saying only it was likely to be "significant". The company earned $1.8 billion in 2010 from copper exports.

The smelter processes 720,000 metric tonnes (793,665 tons)of copper concentrate a year, or 60,000 tonnes a month, and the refinery has an annual capacity of 215,000 tonnes of cathodes, Tan said.

PASAR, which has been producing copper cathodes for export since 1976, operates in an 80-hectare site inside the Leyte Industrial Development Estate.

Acquired in 1999 by Glencore from the Philippine government, PASAR buys and refines copper concentrates from mines in Australia, Canada, Southeast Asia including Papua New Guinea, and South America.

PASAR is one of a handful of companies involved in downstream metals processing in the Philippines.

The Southeast Asian country wants its mining industry to shift to more value-added output by putting up more processing plants, instead of direct shipments of ores currently, to raise more revenue from its largely untapped $1 trillion mineral resources.

Tan said PASAR bought new anti-pollution devices from Chinese suppliers, with the first of three shipments scheduled to arrive next month, to replace damaged equipment.

"We can actually operate our smelter if we want, but we are going to be throwing bad elements into the atmosphere which is not good," he said in a telephone interview.

"So Glencore decided not to operate it because we will be breaking (environmental) laws in the Philippines."

In addition to losing revenue due to the halt in copper exports, Tan said PASAR is also spending $4 million a month for employee salaries, electricity expenses and other costs.

"We have to take this hit because anyway this is just a blip in our long corporate life."

(Reporting by Erik dela Cruz; Editing by Ramya Venugopal)

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