A presentation to

DENR Secretary Roy A. Cimatu

Corporate profile

2

3

Business Structure

4

Ownership Structure

First Pacific Company Limited

Local Publicly Owned

Social Security System

Foreign Publicly Owned

Two Rivers Pacific Holdings

Corporation

Padcal Mine

5

6

Mine Life Extended to 2022

13

Sizeable Resources Remain

Padcal mine is a home to more than 2,000

employees and 15,000 people in a community of

diverse ethnic and cultural backgrounds 8 8

3-year Historical Statistics

9

Operating Highlights

2016 2015 2014

Tonnes Milled ('000) 9,359 9,199 9,506

Production

Gold – ozs 103,304 107,887 105,008

Copper - lbs ('000) 34,961 34,104 35,391

Ore Grade

Gold - gms/DMT 0.417 0.438 0.438

Copper - % 0.206 0.205 0.212

Prices

Gold (US$/ounce) 1,254 1,147 1,270

Copper (US$/pound) 2.35 2.29 2.98

10

Financial Highlights

(in PHP million) 2016 2015 2014

Gross Revenue 10,272 9,189 10,898

Cost & Expenses 6,900 7,011 8,415

Income from

Operations 2,478 1,341 1,633

Net Income 1,568 776 703

Core Net Income 1,657 905 1,122

EBITDA 3,854 2,779 3,320

Operating margin 24% 15% 15%

EBITDA Margin 38% 30% 30%

11

12

Following the 2012 incident due

to 2 days of incessant rains,

Philex employed the spillway

system in Padcal, which follows

strict international standards

and designed by world-renowned

Australian dam developers

TSF3 Rehabilitation

13

• Consists of embankment

(main and offset dikes)

to contain tailings and

penstock to manage excess

water in containment area

• Embankment is made of

earth backfill while penstock

is a concrete structure

complete with an

underground tunnel

• In August 2012, tailings

discharged in penstock A

overflowed due to heavy

rains

Old Penstock System

• Penstock A was sealed in

September 2012

• Void was filled the fastest

and safest way using tailings

from operations

• Offset dike was reinforced

with monitoring systems

installed

• World-renowned TSF experts

tapped for engineering,

construction, and monitoring

of remedial works Golder Associates

SMEC

Coffey Mining

GHD

2013

2017

TSF3 Reinforcement

• Penstock B was sealed in

May 2014

• Open spillway built to replace

penstocks

Designed to manage

1,500mm of rain in 24 hours

(government only requires

management of 1,000mm

of rain in 24 hours)

Engineered by Golder

and SMEC

Construction supervised

by DMCI

• Currently being raised to

615ML overspill crest to suit

operational requirements 2017

2013

Spillway Construction

Environmental Stewardship

17

• First Tailings Storage Facility (TSF) developed in 1967

Even before the Pollution Control Law in 1976

• Community-Based Reforestation started in the 1960s

as a Livelihood Project

Prior to UNESCO’s Man and Biosphere Program in 1971

• Construction of a Materials Recovery Facility in 1998

Before Enactment of RA 9003: Ecological Solid

Waste Management Act of 2001

• First Metallic Mine to be ISO 14001 Certified

(Environmental Management System) in 2002

Earlier than issuance of DAO 2003-14: Self Regulation

Toward Improved Environmental Performance

18

Pro-active Environmental Management

2002 2004 2006 2008 2010 2012 2014 2016

ISO 14001:1996

Sep 10 2002

ISO 14001:2004

Jun 21 2006

ISO 14001:2004

Sep 6 2008

ISO 14001:2004

May 10 2011

• ISO 14001:2004

• Apr 22, 2015

• BSH OSHAS

18001:2007

• Apr 22, 2015

Integrated

Management

System

DENR DAO 2015-07

April 30, 2015

19

ISO-Certified since 2002

Certifying Body: TUV Rheinland Cert GmbH

Am Grauen Stein – 51105 Koln

ISO 14001:2004

Environmental Management

System

OSHAS 18001:2007

Occupational Health Safety

Management System

20

IMS-Certified in 2015

1960’s

1980’s

2000’s

Present

21 21

Mining

footprint

81 hectares

Reforested area

2,800 hectares

Covered area

580 hectares

22

10 million

trees planted

23

3,922 hectares

reforested 24

Water Quality Monitoring

and Management

25

26

Extensive Coverage along

Balog Creek

TSF3

Balog-Agno

Convergence

Balog Creek

2.5 Km

• Initiated by Philex and

accomplished voluntarily by

Padcal Mine workers

• Clean-up activities include:

Sediment bagging

Construction of:

• containment ripraps

• sediment traps

• access

Spraying of rock face

Comprehensive Water

Clean-Up Activities

28

Improved water systems @100m

@700m

29

Assistance Extended to

Numerous Households

• Continuous

community

assistance through:

Public

consultations

Settlement of

claims

Infrastructure

support

Medical and

dental missions

Livelihood

Various Community Development

Programs Initiated

• Provision of 20,000

Elvers and 40,000

Tilapia fingerlings in

Agno River (in partnership

with BFAR and the LGUs of

Barangay Dalupirip and

Itogon municipality)

• Reforestation program

on a 500-hectare area to

prevent further siltation

on Agno river

• Commitment to plant

additional trees as mine

life extends

Sustained Enhancement of Ecosystem

Joint Multi-Partite Monitoring Team (MMT) I. Government Agencies

• MGB (Region I)

• EMB (Region I)

• BFAR (CAR and Region I)

• NIA (Region I)

• CENRO (Urdaneta)

II. Philex MMT

• MGB (CAR)

• EMB (CAR)

• Forestry Management Services (CAR)

• Itogon, Tuba, Ambucao and Camp 3

representatives

• Public Officials

• Indigenous Peoples

III. NPC

IV. SRPC

V. LGU

• Itogon: Municipal Engineer/Municipal

Social Worker

• Barangay Dalupirip

• Representatives from San Manuel/San

Nicolas LGUs

Conduct of Regular Monitoring

Philex MMT

activities: • Establishment of

monitoring

stations

• Monthly water

and sediment

sampling

• Regular fish

sampling

Community Development

33

2014-2015 Revenue Sources (ex-IRA)

(million pesos) Municipality of Tuba Municipality of Itogon

Revenue Source Total from Philex Total from Philex

Business Tax 116.3 107.6 154.3 107.1

National Wealth 22.2 22.2 62.4 22.1

Real Property Tax 5.0 1.6 18.4 1.8

Other Fees 18.0 0.1 17.0 0.5

Revenue

other than IRA 161.5 131.6 252.1 131.5

% Contribution of

Philex 81% 52%

IRA 261.8 161.1

34

Significant Contribution to

Local Government Finances

Municipality Income

Class Economy

La Trinidad First Class

Center of Trade, Agro-

industrial, Manufacturing,

Commercial, Tourism,

Education

Itogon First Class Mining (Philex)

Tuba First Class Mining (Philex) Mankayan First Class Mining (Lepanto)

Bakun Third Class Agriculture

Buguias Third Class Agriculture

Atok Fourth Class Agriculture

Bukod Fourth Class Agriculture

Kabayan Fourth Class Agriculture, Tourism

Kibungan Fourth Class Agriculture

Kapangan Fifth Class Agriculture

Sablan Fifth Class Agriculture

Tublay Fifth Class Agriculture

Based on Cities and Municipalities Competitiveness Index 35

Tuba and Itogon are First-Class

Municipalities

Region/Province Poverty Incidence

PHILIPPINES 21.6 Lanao del Sur 71.9

Maguindanao 57.2

Northern Samar 56.2

Saranggani 55.2

Sulu 54.9

Bukidnon 53.6

Siquijor 52.9

Zamboanga del Norte 51.6

Sultan Kudarat 48.0

Agusan del Sur 47.3

Benguet 3.5

NCR 3.9 CAR 19.7

36

Low Poverty Incidence in

Benguet

15,000 people

living in the

community

37

6,000 patients

served annually

38

+2,000 pre-school,

elementary, and high

school pupils enrolled

annually

39

Countless

professionals produced 40

+2,000 families

supported

41

42

Free housing, water,

and electricity

provided, with safe

and convenient

access around the

community

Economic Contribution

43

2016: P1.35 Billion in taxes

and fees (national and local)

44

2016: P447 Million (EPEP)

utilized for:

• Reforestation of 63 hectares

of new land

• Maintenance of 158 hectares

of existing plantations

• Care over 110 hectares of

agro-forestry areas

• Planting of 187,000 new

seedlings of various species 45

46

2016: P117 Million (SDMP) for various

social development projects

Taxes

Fees and

other

charges

EPEP

SDMP

Total of P1.91B or 122% of

2016 Net Income

2016: Total contribution to

national development

47

48

2012-16 contributions vs net income

5-year contribution

of P8.7B almost 3X

the net income of

P3.0B

Silangan Project

49

• Generate 8,000

direct and

indirect

employment

• Raise P60B in

Investments

• Contribute P31B

in Taxes

• Spend P6B for

community

development

Robust Potentials

Consultant Scope Location

Ausenco Lead Consultant Perth, Australia

Mining Plus Mining Perth, Australia

ALS Metallurgical

Testwork/Pilot Plant Perth, Australia

AMC Consultants Mining Perth, Australia

Behre Dolbear Independent Technical

expert Sydney/Melbourne

SMEC Hydrogeology United States

Knight Piesold Tailings Dam Perth, Australia

Lycopodium Mineral Processing Perth, Australia

Pellss Sullivan

Meynink Geotech Perth, Australia

SNC Lavalin Process Pant Brisbane, Australia

Snowden Mineral Resource Brisbane, Australia

Tunnelvirksomhet Tunneling (Grouting) Norway

SRK Hydrogeology Denver, USA

AECOM Environment Manila, Philippines

SMMCI has engaged these consultants to conform to the best

Australian and Canadian mining standards and practices

Conforms with Australian

Mining Standards

51

52

ISO 14001:2004

Environmental

Management

System

First Non-operating Mine (Phils.)

to be ISO-certified

Thank you

53