Manila says may cancel Intex's $2.4 bln nickel project

Manila last week suspended Intex's permit for 90 days to look into allegations by demonstrators that the project sits on a watershed area.

"If it's proven there was no consultation, the permit will be cancelled automatically," Environment and Natural Resources Secretary Lito Atienza told reporters. "Ninety days is enough to investigate."

Authorities in Mindoro, a largely non-industrialised island in the central Philippines where the nickel mine is located, have said there was no consultation between the government, Intex and the local communities on the project.

About 25 people, including members of a tribal community, priests, local officials and some residents began a hunger strike on Nov 17 to force the government to revoke the mining permit.

The mine has estimated reserves of more than 2 million tonnes of nickel, an ingredient of stainless steel. Intex secured its mining permit on Oct. 14.

Intex has said it has "continuously conducted consultations" with local leaders in Mindoro besides providing education and healthcare programmes.

The suspension will not affect an ongoing feasibility study the company expects to complete this year, it said earlier.

Atienza said ministry officials responsible for giving Intex the permit also faced action if the investigation exposed an anomaly.

"If I find out that officials of the DENR (Department of Environment and Natural Resources) were lying, I will sue them, I want them jailed if it's proven that they allowed this project in a watershed area," he said.

The Southeast Asian country is targeting its mining sector, one of the world's largest and most lucrative in the early 1970s, to attract up to $14.5 billion in investments by 2013.

But only around $2.4 billion has flowed in since 2004 due to communist insurgencies, disputes with communities and local partners and opposition from the Catholic Church. (Reporting by Manolo Serapio Jr.)