Phu Bia Mining (PBM), one of the largest mining operators in Laos, has paid more revenues to the Lao government as the price of copper and gold continue to rise on world markets, the company announced yesterday.
According to a press release from the Australian company, PBM paid about US$39 million in royalties and taxes to the Lao government in 2010, rising from only US$12 million in 2009, due to increased production and prices of copper and gold.
In 2010 Phu Bia Mining's Phu Kham operation produced over 67,000 tonnes of copper, 60,000 ounces of gold and 500,000 ounces of silver.
“The Phu Kham operation has exceeded expectations in terms of copper, gold and silver production,” said Mr Rob Usher, Executive General Manager of PanAust Asia, the parent company of PBM.
“The company goes into 2011 with the Phu Kham operation performing very strongly, the Ban Houayxai Gold-Silver Project in the early stages of construction, and exploration work continuing in Xieng Khuang province and other locations within PBM's concession area in Laos.”
An improved global economic situation in 2010 has resulted in higher commodity prices relative to 2009. The copper price has risen from a low of US$6,091 per tonne to a high of US$9,260 per tonne during the year.
PBM Chairman Mr Chanpheng Bounnaphol said that contributed to the US$39 million in royalties and other taxes paid to the government of Laos in 2010, bringing the total contribution to Lao state coffers by the company to US$64 million.
“Most importantly, PBM reached a financial position towards the end of 2010, which will see the first profits tax payment made early this year,” he said.
PBM is now operating the Phu Kham Copper-Gold Operation in Xaysomboun district of Vientiane province. The company started 2010 with 1,714 full-time employees and ended the year with 2,209 full-time employees, 85 percent of whom are Lao staff, a reflection of the growth the company is experiencing.
In October, the board of the ASX-listed PanAust approved a US$110 million investment to increase ore processing and metal recoveries at the Phu Kham cooper and gold mine.
The investment will deliver an increase in copper-in-concentrate production to between 65,000 and 70,000 tonnes a year by mid-2012, from its current design levels of between 60,000 and 65,000 tonnes a year.
The company also spent more than US$677,000 on community development projects in Laos since the project started in 2008.
PBM was awarded the best community development initiative award at the 2010 Asia Mining Congress in Singapore, in recognition of its efforts to improve living standards and economic conditions in communities around the Phu Kham operation.
PanAust considers Laos as one of its top investment destination due to its mining development potential. The company has decided to use Laos as its regional office due to improved banking and IT systems as well as business environment.
The Lao economy has been growing rapidly over the past five years, mainly driven by the mining sector. The other major mining project in Laos is the Sepon Gold and Copper Operation in Savannakhet province.