THE GOVERNMENT and Philnico Industrial Corp. are engaged in a last ditch negotiations with Chinese investors to save the floundering Nonoc nickel mines rehabilitation project.

In a statement, Philnico president Evaristo Narvaez Jr. said the government has been trying to mediate between Philnico and representatives of Jinchuan Nonferrous Metals Corp. to iron out the kinks in the prospective deal.

“Philnico is optimistic that the government’s mediation efforts with Jinchuan will eventually result in a viable arrangement for the rehabilitation and redevelopment of the mothballed Nonoc nickel mine and refinery,” he said.

Narvaez said Philnico was just clarifying the stance of Jinchuan with respect to its plan to do a new feasibility study on the project before resuming talks for a joint venture.

“While a new feasibility study will further delay the Nonoc project, we are confident of the sincerity of the Chinese investors and their seriousness in pursuing a deal,” he added.

Narvaez said Philnico also welcomed the national government’s support to fast track and conclude negotiations at the soonest possible time so that all stakeholders in the Nonoc nickel project would be able to take advantage of current record prices for nickel.

He added that Philnico, Jinchuan and the government were striving to arrive at terms that are equitable to all parties–a win-win deal that will enable all stakeholders to realize maximum value for their respective investments.

Located on Nonoc Island off Surigao City, the nickel mines is touted to hold one of the largest nickel and cobalt deposits in Southeast Asia. The mines were in operation from 1972 to 1986, when weak commodity prices and rising production costs forced it to close down.

The prospective Chinese investment in Nonoc has been the subject of three agreements signed by President Macapagal-Arroyo and Chinese Premier Wen Jaibao since 2004.

Negotiations hit a roadblock earlier this month after Philnico and Jinchuan failed to agree on the exact percentage each party would own in the rehabilitated firm.