Philex considers major fundraising for Silangan project

Philex Mining Corporation is considering raising an additional USD 400 million to finance the second phase of its Silangan Mine project in Mindanao.

In a report by Philippine Star, Philex chairman Manuel V. Pangilinan said that the firm is considering pushing forward with the planning for Phase 2 of the Silangan gold and copper mine before its commercial operations commence next year.

Pangilinan added that there is a possibility of conducting a follow-on in late 2025 or 2026, with the amount paralleling Phase 1 or possibly even larger. Additionally, the funding for Phase 2 is expected to be a mix of debt and equity, with a ratio of 70:30 favoring debt.

Philex has been eyeing the production of the first metal from the Silangan mine, starting with gold, by the last quarter of 2025. This schedule has been pushed back from the initial goal, which was the first quarter of 2025, owing to setbacks in securing the financing arrangement and the delivery of the processing plant equipment of Phase 1.

Earlier this year, Silangan secured a USD 170 million loan facility to guarantee the commencement of its commercial operations next year. In 2023, Philex obtained a USD 100 million syndicated debt facility from various lenders for the Silangan project.

In February, the mining firm acquired an additional USD 70 million through a syndicated credit facility from local banks.

Philex explained that the initial capital cost for developing the starter mine is around USD 224 million, financed through a combination of capital infusion from the company, equity via stock rights offer, and debt.

Philex managed to raise Php 2.6 billion in 2023 by offering shares to its existing stockholders. This amount was used to kickstart the development of Phase 1 of the Silangan project.

Phase 1 of the Silangan project is determined to have a mine life of 28 years, with mineable reserves of 81 million metric tons, yielding recoverable copper of 993 million pounds and 2.8 million ounces of gold.