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DMCI Mining Corporation (DMCI MC) is 78%-owned subsidiary engaged in ore and mineral mining and exploration. It was incorporated on May 29, 2007. It has entered into a Memorandum of Agreement with Rusina Mining Ltd., a listed company in Australia, in which the Corporation agreed to be the independent contractor to directly undertake the mining operations in the municipalities of Sta. Cruz and Candelaria in Zambales. The mining operation is an open pit extraction of nickel, chromite, and iron laterite for direct shipping.
The Company’s venture into nickel mining proved to be a good move until the sharp drop in the base metal commodity prices in mid 2008. DMCI Mining Corp., the Company’s nickel mining subsidiary, posted a modest net income of P45 million for the first half of 2008 but due to the dive of nickel prices, DMCI Mining reported a marginal P13 million in full year net income from nickel ore shipments worth P450 million. The 2nd half 2008 DMCI Mining scaled down its mining operations due to changes in market demand. It sold its existing stockpile at low prices with some shipments priced below costs to at least liquidate its non moving stock pile.
Although the current situation for the nickel business looks bleak, the Company believes that when opportunities return to the nickel commodity business, DMCI Mining is well positioned with its already existing partnerships and nickel mining experience.
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