Canatuan Project

At A Glance
Ownership TVI Resource Development Philippines Inc. — 100%
Location Sitio Canatuan, Barangay Tabayo, Siocon Municipality,
Zamboanga del Norte
Business activities Gold and silver production (2004-2007)
Copper and Zinc concentrates production (2008-2013)
Total Production Gold (Au): 105,200 ounces
Silver (Ag): 1.8 million ounces
135,694 Gold (Au) equivalent ounces
Copper (Cu): 199,778 dmt
Zinc (Zn): 30,548 dmt
Current Manpower Peak employment of 1,200
Logistics Upland mining areas are approximately 1.0-hour driving time to the port area in Santa Maria, Siocon Municipality

Canatuan is TVIRD’s 100%-owned flagship project in the Philippines. By virtue of its Mineral Processing Sharing Agreement (MPSA), TVIRD is the first company in the country to operate under the Philippine Mining Law enacted in 1995.From 2004 to mid-2008 TVIRD produced gold and silver doré from an overlying gossan (oxidized) portion of the deposit. As this upper portion of the orebody was mined out, the underlying primary sulphide portion of the deposit containing copper and zinc was exposed.

By November 2008, TVIRD had completed construction of a sulphide production plant to process the underlying sulphide orebody containing copper and zinc and commenced commercial production of copper concentrate in March 2009. From March 2009 to February 2014, TVIRD completed 39 shipments of copper concentrate for a total volume of 1,959,778 dmt and seven shipments of zinc concentrate for a total volume of 30,548 dmt, as compared to an initially anticipated 119,800 dmt of copper concentrate and 6,100 dmt of zinc concentrate. Milling operations concluded in late 2013, pending the results of assessing various mine life extension and expansion opportunities.

The Canatuan Project site is located in a 508-hectare MPSA area in the agricultural town of Siocon, province of Zamboanga del Norte. It is accessible by air to Zamboanga City Airport and continue on by land – approximately 5.0 hours driving time via RT Lim and Balguian Municipalities.The port area in Santa Maria, Siocon Municipality is accessible at approximately 1.0-hour driving time.

The upland area is inhabited mainly by the indigenous Subanon tribe – rightful ancestral domain claimants – as well as other non-tribal communities. Prior to operating, TVIRD sought the tribe’s free, prior and informed consent; thus, securing from them the social license to operate and sharing a common development roadmap for the future.

Canatuan is a volcanogenic massive sulphide (VMS) deposit located in the Province of Zamboanga del Norte. Volcanogenic massive sulphide deposits, like Canatuan, rarely occur in isolation. Exploration on the properties suggests 40+ kilometres (25+ miles) of the same type of geology that hosts the Canatuan orebody.

The Canatuan processing plant has been decommissioned and equipment reconditioned for use in the Balabag Project (See: Balabag Gold-Silver Project). Among the prospects TVIRD is exploring are possible new discoveries from exploration drill targets outside of the pit area, possible production of pyrite concentrates, re-processing of tails and harnessing possible economic deposits from outside the current MPSA – Malusok and SE Malusok – which are located at a short trucking distance from the Canatuan mine pit.TVIRD continues to seek regulatory approval for expansion of its current MPSA to include these deposits in areas adjacent to its current contract area.

Following the end of mining and processing operations in January 2014, decommissioning and rehabilitation activities within the disturbed areas commenced. Approximately 165 hectares are subject to the closure programs as identified in the approved Final Mine Rehabilitation and Decommissioning Plan (FMRDP). First quarter 2014 activities focused on the decommissioning of plant and equipment within the mill and processing plant area as well as the continuation of progressive rehabilitation activities within the overburden waste areas. The rehabilitation tasks include earthwork stabilization, drainage controls and re-vegetation.Water quality monitoring and meteorological data collection, hydrologic data collection and instrumentation data collection for the Tailings Storage Facility (Sulphide Dam) continued throughout the year.

The Greater Canatuan Tenement Area (GCTA) surrounding the Canatuan mine comprises an extensive 352 square kilometre (136 square mile) on which TVIRD has a package of tenement applications. The company believes that similar Canatuan-like deposits exist within the GCTA and that there is a potential for discovering extension developments. Any mineable ore located in this area could be economically transported to the existing Canatuan plant for processing, which would extend the life-of-mine.MPSA processing and approval are on hold due to the ongoing moratorium on new mineral permit applications imposed by the Secretary of the Department of the Environment and Natural Resources (DENR) in compliance with Executive Order No. 79, Series of 2012. In March 2013, the DENR lifted the moratorium on application for exploration permits, but retained the moratorium on MPSAs and financial or technical assistance agreements in spite of the signing of the much-awaited Executive Order by the President of the Philippines. In November 2014, the DENR’s Mines and Geosciences Bureau (MGB) relaxed the current mining policy, allowing companies faced with depleting reserves to expand their contract areas.

While the approval of required permits will enable exploration work to continue, timing as to the actual issuance continues to be uncertain.