Philex suspends operations at Benguet mine after tunnel gets flooded

(Updated 7:01 p.m.) Philex Mining Corp. suspended operations at its Padcal Mine site in Benguet after heavy rains from tropical depression Ferdie and Typhoon Gener flooded an underground tunnel, the company disclosed to the Philippine Stock Exchange Friday.   Philex shares dropped 7.59 percent to P20.12 at the end of Friday’s session following the announcement. Padcal is Philex's only producing gold mine.   “Initial inspection showed that water and sediment are being discharged from one of the two underground tunnels that drain clear water from the penstock in the tailings pond,” said Philex, the country’s biggest copper and gold miner which recently moved into energy exploration.   Mines and Geosciences bureau director Leo Jasareno told AFP that the government was assessing any potential hazards posed by the tailings spill at the Padcal mine, though Philex Mining denied the discharge was toxic.   There were no reported casualties due to the accident.   "We have issued a suspension order on the mine," Jasareno told AFP by telephone as he drove to the mine, located near the northern mountain resort of Baguio. There were no reported casualties.   "Philex is exerting its maximum effort to address the accidental discharge, and has mobilized the requisite resources in this regard," the country’s top gold mining firm said in a statement.   But bad weather in the country is hampering company efforts to assess the extent of the damage, Philex vice president for corporate affairs Mike Toledo told AFP, adding that they still had no timetable for resuming operations.   Philex stopped operations of their Benguet mine August 1 midnight as they conducted an inspection.   "I think we'll still be able to reach our (production) targets," Toledo told AFP when asked if the shutdown would affect the company's profitability.   Typhoon Gener induced widespread flooding across the northern Philippines this week that claimed at least 37 lives according to the government's updated toll.   The accident comes amid an intense public debate in the Philippines on the mining industry.   The Philippines is believed to have some of the biggest mineral reserves in the world – the government estimates the country has at least $840 billion in gold, copper, nickel, chromite, manganese, silver and iron ore deposits.   However, the minerals have been largely untapped, partly because of a strong anti-mining movement led by the influential Catholic Church, while poor infrastructure and security concerns have also kept investors away.   Last month President Benigno Aquino III signed an executive order imposing more restrictions to protect the environment and local communities while seeking to increase royalties from mining firms.