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Mining firm cries foul over gov't suspension of Surigao operation

PACIFIC NICKEL Philippines, Inc. (PNPI), a subsidiary of Philnico Industrial Corp. on Wednesday expressed disappointment over the government's sudden move to suspend its operations in a mineral reservation in Surigao del Norte countering claims of the government that it has not paid its debt to the state.

In a statement, Evaristo M. Narvaez, Jr., president and chief executive officer of PNPI said that the company was not given a fair hearing on the suspension order issued by the Mines and Geosciences Bureau (MGB).

The sudden suspension, he said was done "hastily and without due process."

Last month, the MGB, an attached agency of the Department of Environment and Natural Resources ordered the suspension of the PNPI's mining operations as well as its permits for transporting and exporting mineral ores, after Environment Secretary Ramon J. P. Paje received a letter from Finance Secretary Cesar V. Purisima that the parent company did not pay in full its debt to the government.

In a letter dated May 16, Mr. Purisima told Mr. Paje that the miner had paid only $1.25 milion of the $263.8 million it owed the government since 1996 and that the DENR should take necessary action on the matter.

"The claim of the Department of Finance (DOF) that the government did not receive any payment is not accurate," Mr. Narvaez said.

He added that the company returned the bulk of the nickel refinery, which originally cost approximately US$200 million to the government without getting any financial credit or reduction in its obligations to the government. --Louella D. Desiderio/BusinessWorld

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