The Mankayan District of Benguet where Lepanto is located has been known as a major source of copper as far back as the 12th century when Chinese traders were reported to have exchanged their wares for copper ingots from Mankayan. Mining there flourished even during the Spanish regime when Mankayan became the country’s key source of metals. In fact, it was the Spaniards who named Sitio Lepanto of Mankayan as such, reportedly because the hostility of the natives reminded the Spaniards of their encounter with the Ottoman Turks in the “Battle of Lepanto” in 1571. In 1864, the Cantabro Filipino Company became the first organized group to operate the mine. Their operation ended 10 years later with the death of the founder, Don Jose Maria Santos.
On September 21, 1936, several prospectors led by Americans Victor Lednicky and Melvin Arick incorporated the Lepanto Consolidated Mining Company. The Company built the country’s first copper concentrator which initially operated at a capacity of 400 tonnes per day, increasing to 1,000 tonnes per day prior to the outbreak of the Second World War.
During the war, the mine was operated by the Mitsui Company of Japan for three years. However, the mill and other mine facilities were destroyed towards the end of the war necessitating their rehabilitation. Operations resumed in 1947 at an expanded capacity of 4,500 tonnes per day, which was maintained until 1996. From 1948 to 1996, Lepanto’s Enargite copper operations produced 1.58 billion pounds of copper, 2.9 million oz. of gold and 12.0 million oz. of silver, recovered from 34.4 MT of Enargite ore averaging 2.2% Cu and 3.5 g/t Au.
The company was Filipinized in the 1960s with the entry of the group of industrialist Carlos Palanca, Jr. during whose stint as Chairman and CEO the Tubo shaft and Roaster plant were constructed and the Far Southeast (FSE) deposit was discovered.
The interest of Mr. Palanca’s group was acquired by the group of Felipe U. Yap two decades later. Since 1988, Mr. Yap has been the company’s Chairman and CEO. Amidst a series of domestic and international crises, Mr. Yap enhanced the value of Lepanto through capital-raising, the development of the Victoria mine, construction of major infrastructure including Tailings Dam 5-A for both Lepanto and the FSE Project, the Nayak Shaft, and the Nayak Twin Declines.
In September 1995 when the marketing of the copper concentrate from the Enargite was becoming increasingly difficult and copper price was starting to decline, the Victoria orebody was discovered. A major underground program to fast-track access to the orebody and develop it was immediately launched. Construction of a carbon-in pulp plant started in November 1996 and was completed in four months. Eighteen months from its discovery, the Victoria Gold Project became operational, making the project one of the fastest underground gold mines to be developed. Lepanto then became the country’s biggest primary gold producer. From 1997 to 2015, the Victoria Gold Project produced 1,384,523 oz. of gold and 2,673,851 oz. of silver.
The FSE deposit was discovered in 1980. In the ensuing years, the orebody was delineated based on the results of 54 kilometers of drill holes. A pre-feasibility study based on the drilling results and bolstered by inputs from several recognized international mining and engineering consultants was completed in 1988. The project was postponed, however, due to low metal prices and the high capital costs required to develop the mine. The rise in copper and gold prices over the last few years have rekindled interest in the FSE, culminating in the execution in September 2010 of an Option and Shareholders’ Agreement among Lepanto, Far Southeast Gold Resources, Inc. (FSGRI), and a wholly-owned subsidiary of Gold Fields Limited of South Africa in relation to the development and operation of the FSE project. Lepanto presently owns 60%, and Gold Fields, 40%, of the outstanding capital of FSGRI. Gold Fields has an option to acquire an additional 20% interest in FSGRI.
FSGRI started a major underground drilling program in 2011 which resulted in the declaration in September 2012 of an initial Inferred Mineral Resource of 892 million tonnes of 0.7g/t gold and 0.5% copper for a total of 19.8 million oz. of gold and 9.921 billion lbs. of copper.
In June 2015, Lepanto started a company-wide Environmental Management System (EMS) to secure an ISO 14001 certification. Following a successful audit by TUV Rheinland Phils, Inc., TUV Rheinland-Germany confirmed on May 12, 2016 Lepanto’s EMS complies with and adequately maintains and implements the requirements of the standard. Thus, the ISO 14001:2004 + Cor. 1:2009 certificate was issued to Lepanto for its corporate office in Makati City; the Lepanto Warehouse in Malolos, Bulacan; and Lepanto Mine Division in Mankayan, Benguet.