PMO Assets North Davao Mining Corporation (NDMC)
The North Davao Mining Corporation (NDMC) mineral property is located in the province of Davao del Norte, in the southeastern part of the island of Mindanao, the main southern island of the Philippine Archipelago. The area has a long history of gold and copper mining. Since the 1940’s, various companies have carried out operations in the vicinity. NDMC itself had two major mining operations in the area, namely, the Amacan Copper and Hijo Gold Projects.
But following the EDSA revolution in 1985, NDMC was sequestered by the Presidential Commission on Good Government (PCGG) because of alleged Marcos-sponsored behest loans. The mining company’s account was then transferred to the Assets Privatization Trust (APT). The Amacan Mine was operated by the APT until 1992, but was eventually closed because of low metal prices, adverse economic conditions and internal management problems.
The NDMC property has been under the receivership of the government through its Privatization and Management Office (PMO) until it was transferred to the Philippine Mining Development Corporation (PMDC) on April 7, 2006 for proper disposal through public bidding. To facilitate the promotion of the property as an investment target, PMDC executed a Memorandum of Agreement with the Mines and Geosciences Bureau (MGB) for the purpose of conducting an assessment of the copper/gold potential of the property.
The NDMC asset consists of two partially-mined deposits, Hijo and Amacan, together with several other gold and copper-gold prospects. A total of seven (7) porphyry copper prospects and sixteen (16) meso-epithermal gold prospects were identified within the area of 20,237 hectares, easily making it one of the single most mineralized areas in the country.
Hijo Gold Mine
I. Location and Accessibility
The NDMC Mineral Property lies in the southwestern flanks of the Diwata Mountain Range of Eastern Mindanao. It is approximately 975 aerial kilometers southeast of Manila and 60 aerial kilometers northeast of Davao City. It lies within geographic coordinates 7°16’00” to 7°29’30” N and 125°58’00” to 126°06’30” E.
The area under the Financial and Technical Assistance Agreement (FTAA) application spans the municipalities of Mabini, Maco, Nabunturan, San Mariano (formerly Maragusan) and Mawab in Compostela Valley Province, Mindanao Island, Philippines. It is accessible via a three-hour drive through the northbound concreted RP-Japan Fiendship Highway from Davao City to Mawab Junction (73 km) and then through an all-weather dirt road to the mine site (37 km). Daily flights from Manila to Davao are available and normally take 1.5 hours. There are also two seaports near the NDMC mine site—the Madaum Pier of Hijo Plantations, Inc. in Tagum City (67 km) and the Panabo Pier (83 km) of Tagum Development Corporation.
II. HISTORY OF EXPLORATION AND MINING
A. HIJO GOLD MINE
The original claims in the Hijo area were staked out in 1934, covering what was then known as the Davao Gold Mine (DGM). Samar Mining Company, Inc. (SAMICO) began running gold ore from the site in 1939 at 150 tonnes per day. About 57,000 tones averaging 12 g Au/t were mined by open pit and underground methods until the outbreak of World War II. Mining operations resumed in 1960 but were stopped because of high production costs.
In October 1979, SAMICO transferred its operating rights to NDMC. NDMC, under a profit sharing agreement with Apex Mining Company, delivered the ore to the Apex Mill at the Masara mine site for processing. NDMC developed and mined592,293 DMT at an average grade of 5.46 g Au/t from May 1980 to June 1985. The mine eventually closed due to depletion of readily open-pittable reserves.
A total of 131,091 ounces of gold was extracted intermittently from the mine from pre-war years up to 1985.
B. AMACAN COPPER PROJECT
The claims in the Amacan porphyry Cu-Au orebody were staked out by SAMICO in 1963 and were explored by reconnaissance to detailed geological mapping and geochemical sampling in 1964. The Amacan Copper Mine was in operation from August 1982 to May 1992. A total of 50,241,716 tons averaging 0.39% Cu and 0.30 g Au/t have already been mined out. The remaining drill-indicated reserve is 65 million MT at 0.34% Cu and 0.412 g Au/t at 0.22% Cu cut-off. The mine closed due to accumulating debts, low copper price, decreasing copper grades, deteriorating equipment and increasing operational costs.
C. PANORAON PORPHYRY CU-AU DEPOSIT
The Panoraon property was an active mine site in the late 1960’s until 1971. The mine was operated by INCO Mining, through an operating agreement with SAMICO, at a cut-off grade of 0.5% Cu. Mined ore was delivered to Apex Masara mine mill. In 1972, a large landslide covered a sizeable portion of the pit, burying a bulldozer in the process. This eventually led to the closure of the mine. INCO Mining was reported to have mined 200,000 tonnes of ore at 0.8% Cu and 7 g Au/t. NDMC took interest in the deposit in 1982 due to its reported high copper and gold grades. A NDMC report mentioned that the diamond drill holes bottomed into ore, indicating that the porphyry copper mineralization may still be open at depth.
III. GEOLOGY AND MINERALIZATION
The NDMC property is located within what has been traditionally called the Masara Mineral District. The Area is underlain by an ophiolitic basement and volcano-sedimentary sequence consisting, from oldest to youngest, of:
- Pre-tertiary Basement complex consisting of amphibolitic schist and serpentinized ultramafics
- Pre-tertiary volcanics and sediments (Masara Formation)
- Paleogene sediments (Hijo Formation)
- Miocene limestone (Tagbaros Limestone)
- Pliocene to Pleistocene volcanic flows, pyroclastics and sediments, and
- Quaternary alluvium
The Masara Formation served as the main host rock for the porphyry copper-gold and meso-epithermal gold mineralization in the Masara sub-district. The Hijo Formation act as host rock to the sediment-hosted replacement gold mineralization such as in the Hijo-Barrio-Palali deposit and the vein and sediment replacement prospects of Gacob, Anitapan, Shanghai and Lost Horizon.
The mineral prospects in the area are distributed along a north-south trending zone that is approximately 20 km long and 9 km wide. Twenty-three (23) prospects of mineralization were identified mainly from past literature and current sites of informal artisanal mining. Considering the accessibility, geography and distribution of the mineral prospects, the NDMC area may be divided into a Northeast Block and a Southwest Block, their boundary being the Masara fault zone. Porphyry copper mineralization is only present in the Northeast Block while quartz-sulfide-gold vein and sediment replacement gold deposits occur in both blocks.
IV. THE NORTHEAST BLOCK PROSPECTS
A. AMACAN GROUP. Surrounding what was once an active mine at the east-central portion of the NDMC property is this group of porphyry copper prospects. Among these, only the Piaminyan and Tarago prospects have been explored by limited drilling, disclosing the presence of porphyry copper mineralization of similar grades as that in Amacan orebody.
B. LAKE LEONARD GROUP. This includes the Lumanggang gold prospect wherein 1.8 M oz of gold resource could be present.
C. TAGBAROS GROUP. This contains three porphyry copper prospects and the Goldsborough gold prospect, which is a possible open-pittable resource.
D. RCO GOLD PROSPECT. This sediment replacement gold prospect has mineralization similar to that of the Hijo deposit mined by the NDMC in the 1980’s.
V. THE SOUTHWEST BLOCK PROSPECTS
A. SAGAY-SAGAY GROUP. Although much of the samples collected from this group of prospects yielded no significant gold values, past high-grading activities and open-cut mining by Apex in the Kanarubi segment indicate that there are pockets and/or segments that contain sufficient gold to warrant mining. The Monte de Oro gold rush, which erupted in the area in 2004, is also an indication.
B. MARAOT GROUP. This group includes the Royal Flush and the Lost Horizon prospects which were previously mined by INCO and NDMC. Together with the Magwandos prospect, these deposits may still justify a medium-scale operation.
C. DASURAN GROUP. High-grading operations were once active in the Lawaan area. Similarly, the Dasuran prospect is one high-grading area that has been active since at least a decade ago.
D. HIJO GROUP. The Hijo, Barrio and Pallali sediment replacement gold deposits are reported to still contain 1.713 million tons at 3.48 g Au/t.
Philippine Mining Development Corporation
3001B & C West Tower, Philippine Stock Exchange Center
Ortigas Center, Pasig City 1605, Philippines
Telefax : (63-2) 706-1630 to 31
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