Philex Mining subsidiary Brixton Energy and Mining (BEMC) has suspended mining at its underground coal mine in Zamboanga Sibugay in the Philippines, saying operations has to be halted due to the global coal prices and the increase in coal mining costs.The company says maintenance work will continue at the mine for the next six months and a detailed review of the mine’s viability will be undertaken during this time. The review is in aid of assessing its viability, including the evaluation of possible options to address current technical and commercial issues and to prepare the coal production work program and budget for the next five years. The Sibugay coal project is covered by coal operating contract No 130, awarded by the country’s Department of Energy in 2008. The contract area for development and production covers two coal blocks in Barangays Butong and Santa Cruz in Diplahan, and Barangay Del Monte in Buug – both in the province of Zamboanga Sibugay.
Brixton’s general manager, Isagani Francisco, says the coal price being quoted by a customer in January declined by almost half from the 2012 contract price.“This will definitely have a negative impact on Brixton’s financial position.” “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.”