Govt assumes 10 percent ownership of Phu Bia

Govt assumes 10 percent ownership of Phu Bia

The Lao government has taken ownership of a 10 percent share of the Phu Bia Mining Company, one of the major mining operations in the country.

Deputy Minister of Finance, Mr Santiphab Phomvihane and PanAust Managing Director Mr Gary Stafford signed an agreement last week to transfer 10 percent of the shares of Phou Bia Mining Company to the Lao government, in accordance with the terms of the concession agreement.

The share pledge and share transfer agreements were signed at a ceremony at the Lao Plaza Hotel in Vientiane on August 2.

Deputy Minister of Energy and Mines, Mr Somboun Rasasombath, Deputy Minister of Planning and Investment, Mr Bounthavy Sisouphanthong and the Chairman of Phu Bia Mining Ltd, Mr Chanpheng Bounnaphol and a number of senior government officials were in attendance at the event.

The latest share transfer signing ceremony was held in accordance with a shareholders agreement, which the Lao government and Phu Bia Mining Company signed in May 2011

“Phu Bia Mining is delighted to formally welcome the Government of Laos as a shareholder in the company”, said company chairman Mr Chanpheng. “This reflects the warm, cooperative relationship that Phu Bia Mining shares with the government and the company's commitment to the Lao PDR,” Mr Chanpheng added. PanAust, an ASX listed company based in Australia, is the parent company of Phu Bia Mining.

Phu Bia Mining is in a period of strong growth with an upgrade of the Phu Kham Copper-Gold Operation nearing completion, the opening of the Ban Houayxai Gold-Silver Operation and an active exploration programme underway.

In the first half of 2012, Phu Bia Mining produced approximately 29,000 tonnes of copper, 41,000 ounces of gold and 246,000 ounces of silver, putting the company in a strong position to meet full-year production guidance of approximately 64,000 tonnes of copper, 135,000 ounces of gold and 650,000 ounces of silver.

The Lao government has welcomed the extra revenue it expects to receive from Phou Bia after taking over 10 percent of the company.

Phu Bia Mining's total direct contribution to government revenues (royalties, taxation and tenement fees) in 2010 was about US$57 million. In February 2011 the company made profit tax payments totalling US$32.3 million for the 2010 year.

The company is a significant contributor to the Lao economy. Phu Bia directly employs almost 1,900 Lao nationals, which comprises 84 percent of Phu Bia Mining's workforce.

Phu Bia Mining has a mineral exploration and production agreement with the Lao government that regulates exploration and mining within a 2,636 square-kilometre contract area.

PanAust, the parent company of Phu Bia Mining Company, announced on its website that its Lao subsidiary has discovered a sufficiently large amount of ore reserves to secure a supply of ore to the Phu Kham Copper and Gold operation for the next 14 years.

vientiane times