PMEA Blog

Australia-listed Lafayette Mining Ltd entered voluntary administration on Tuesday to avoid bankruptcy and give it time to obtain new capital or to sell its troubled Philippine mining business.

Lafayette was the first foreign company to operate a mine in the Philippines after a law granting full foreign ownership of local projects was upheld in 2004.

But cyanide spills in 2005 shut the copper and zinc mine for more than a year, causing huge financial strain and making the Australian owner the poster child for the perils of large-scale mining in a country deeply suspicious of the sector. The ensuing uproar hampered government plans to attract billions of dollars in foreign investments to the minerals industry but after a period of quiet, big players are testing the waters and Lafayette`s financial distress is unlikely to put off the industry`s slow revival.

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