26987 - Mindoro Resources Ltd

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Summary of Proposed Investment

Project Number

26987

Company Name

Mindoro Resources Ltd

Date SPI Disclosed

Jun 8, 2010

Country

Philippines

Industry

Metals and Mining

Projected Board Date

Jul 9, 2010

Status

Completed

Sector

Nickel

Department

Infra-WBG Dir. Minerals & Metals

Environmental Category

B - Limited

Previous Events

Approved : Jul 12, 2010
Signed : Jul 14, 2010
Invested : Jul 21, 2010

Project Description

IFC released the original SPI in September 24, 2008. The project was not submitted to the IFC Board as exploration activities ceased due to the global financial crisis. In April 2010, the company restarted exploration and IFC undertook its second review. This SPI updates the version previously disclosed (please see attached) and should be read in conjunction with it.

Mindoro Resources Ltd (“Mindoro”, or the “Company”) objective is to build a successful exploration and mining company in the Philippines with focus on nickel, copper and gold. Mindoro’s primary asset is the 75% interest in the Agata nickel laterite deposit in the Agusan del Norte Region, Northern Mindanao Island. The Agata nickel prospect has the potential to become a sizeable nickel mine with resources possibly in excess of 100 million tons at comparatively attractive nickel grades. Agata has a NI 43-101 compliant measured and indicated resource of 36.5 million wet metric tonnes at 1.11% nickel (dry), containing 657 million pounds of nickel and 24 million pounds of cobalt. Mindoro also owns interests in gold, copper, and copper-gold prospects in the Surigao District, Batangas District on Luzon Island, and on Pan de Azucar Island.

IFC equity investment will support Mindoro’s resource drilling, feasibility and other studies, and exploration activities for its nickel, copper and gold prospects.

Sponsor / Cost / Location

Product Line	IFC Investment (million USD)
Risk Management
Guarantee
Loan
Equity	9.53

Development Impact

The project is in exploration phase so its development impacts are limited in scope at this stage. However, the project is located in an underdeveloped part and frontier region of the country. It is outside of key centers of commercial activity and will likely contribute significantly to the areas development should it transition into a full operating mine and refining operation. Expected impacts would include generation of employment, local economic development through purchases of goods and services, improved access to infrastructure, and payments to central and local governments in the form of taxes and royalties. Mindoro has also entered into a novel partnership arrangement with local artisanal miners to help them secure small scale mining permits and meet environmental and social compliance requirements. Mindoro has also entered into a Benefits Sharing Arrangement with local indigenous people committing the Company to providing employment opportunities, skills training, scholarship funds and a share of any mining revenues.

During the exploration phase the key impacts to monitor will include: (i) finalization of drilling program and resource confirmation; (ii) number of local employees; (iii) completion of feasibility studies confirming mine planning and applicable onsite processing techniques; and (iv) completion of required Social and Environmental assessments for each stage of development.

IFC''s expected contribution during the pre-development phase of the mine includes:

Provider of Capital: IFC''s investment will provide much needed capital for further exploration and preparation of studies that will take the Company closer to mine development and enhance the Company''s prospects for attracting future investors and potential joint venture partners.

Long-term shareholder: IFCs role as a long term, strategic investor provides comfort to the Company and other investors that adequate funding would be available, for a large-scale nickel mine and processing facility. The Company seeks a partner who is willing to play a significant role in the future mobilization of funds.

Environmental and Social Expertise: IFC''s involvement will help set benchmarks on environmental and social sustainability practices in the Philippines mining sector. IFC will provide guidance to Mindoro and help build its internal environmental and social management systems and ensure implementation for sustainable development.

This is a category B project according to IFC’s Environmental and Social Review Procedure because it is an exploration project, with very limited environmental and social impacts that are identified and mitigated. No communities are physically displaced and land access is transitory and sporadic. The key social and environmental issues in relation to the exploration activities are: erosion and rehabilitation of drill sites and trenches, waste materials, water and effluent management, occupational health and safety, compensation and management of local expectations.

The IFC has reviewed project benefits and associated governance risks and believes that the project should be supported. In coming to this view, IFC considered the magnitude of fiscal benefits, which are limited during the exploration phase, governance metrics and the World Bank’s engagement to support anti-corruption and good governance, including support to the Philippine’s efforts to engage in EITI. In the extractive industries, the World Bank Group has provided support to the Department of Environmental and Natural Resources to facilitate stakeholder dialogue in support of development of the Philippines mining sector, a development priority for the Philippines government. The reaffirmation of the 1995 Mining Act by the Philippines Supreme Court in December 2004 has substantially reduced legal uncertainty for investors while affirming transparent sharing mechanism for revenue, taxation and royalty between private companies and the public sector. Moreover, as per IFC requirements, the company will publicly disclose all material payments made to government.

Attachments

File Name	Actions
2008 SPI Released.pdf

Contacts

For Inquiries About the Project, Contact

Jon Dugdale
Director, President and CEO, Mindoro Resources Ltd
Email: jon@mindoro.com
Tel: (780) 413-8187
Toll Free: 1-877-413-8187 (North America only)
Fax: (780) 426-2716

J A (Tony) Climie, P. Geol
Director of Exploration, COO – Mindoro Resources Ltd.
President, CEO - MRL Gold Phils. Inc
Email : tony@mindoro.com
Tel: (780) 413-8187
Toll Free: 1-877-413-8187 (North America only)
Fax: (780) 426-2716

Penny Gould
VP Investor Relations – Mindoro Resources Ltd.
Email: penny@mindoro.com
Tel: (780) 413-8187
Toll Free: 1-877-413-8187 (North America only)
Fax: (780) 426-2716

Websites :
www.mindoro.com
www.mrlgold.com.ph

For Inquiries and Comments About IFC, Contact

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IFC Corporate Relations
2121 Pennsylvania Avenue, NW
Washington DC 20433
Telephone: 202-473-3800
Fax: 202-974-4384
E Mail: Webmaster

Local Access of Project Documentation

Canada – Head Office
Mindoro Resources Ltd
Suite 104, 11707-105 Avenue
Edmonton, Alberta, Canada T5S 1T1
Tel: (780) 413-8187
Toll Free: 1-877-413-8187 (North America only)
Fax: (780) 426-2716
Email: Mindoro@mindoro.com
Website: www.mindoro.com

MRL Gold Phils. Inc.
Makati Office
Unit 604 Penthouse, Oppen Building
349 Senator Gil Puyat Ave., Makati City
Tel: (632) 895-8706, (632) 895-6893
Fax: (632) 895-5459
Email: mrlgold@mrlgold.com.ph
Website: www.mrlgold.com.ph

Butuan City Office
Door 4 Cabaluna Apartment
8th Street, Guingona Subdivision
Butuan City

This Summary of Proposed Investment is prepared and distributed to the public in advance of the IFC Board of Directors' consideration of the proposed transaction. It is not an offer of shares to the public and is intended solely to enhance the transparency of IFC’s activities. This document should not be construed as presuming the outcome of the Board decision. Board dates are estimates only. The following SPI is disclosed in accordance with IFC’s Policy on Disclosure of Information that went into effect April 30, 2006.

The map is for illustrative purposes and does not imply the expression of any opinion on the part of the World Bank, concerning the legal status of any country or territory or concerning the delimitation of frontiers or boundaries. Country borders or names do not necessarily reflect the World Bank Group's official position. In some cases, available project location information is limited to the country of the project's activities. Locations are approximate.

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