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Philex subsidiary halts coal mining operations as prices fall

Philex Petroleum Corp. subsidiary Brixton Energy and Mining Corp. (BEMC) will suspend its coal mining operations in Diplahan, Zamboanga Sibugay for six months as a result of falling coal prices, the company disclosed to the Philippine Stock Exchange Wednesday. "[BEMC] has recently been adversely affected by the significant drop in coal prices. In response to this unexpected change in market conditions, it has been decided to undertake a detailed review of the operations and prospects of the coal mining project under Coal Operating Contract No. 130 located at Diplahan, Zamboanga Sibugay,” Philex said in its disclosure. BEMC said that it decided it would be “prudent” to suspend underground mining operations while the review is being undertaken, a company statement said in part. "In the meantime, activities will be confined to maintenance and repair of the coal mine, and to processing and marketing of existing coal inventory,” it added. Oversupply has brought down world prices in coal, and led to a large drop in Philex Petroleum's profits in the first three quarters of last year. The company reported that its earnings for the first nine months of 2012 fell to P131.85 million from P472.11 million the year before. For the same period, Philex Petroleum's revenues amounted to P154.37 million, down by more than half year-on-year. Of the amount, P34 million came from Brixton and P120 million came from petroleum sales by Philex’s Forum Energy. — BM, GMA News