CAER withdraws proposal to mine Pagan
A Texas-based company has withdrawn its proposal to mine pozzolan at Mt. Pagan, according to the Marianas Public Lands Authority yesterday.
MPLA board chair Ana Demapan-Castro disclosed that the Consolidated American Energy Resources Inc. had notified the MPLA about its decision to pull out and refund its application fee of $5,000.
“I learned yesterday that CAER pulled out and it wants to get its money back. I’m not very sure if they can do that,” said Demapan-Castro.
The MPLA earlier said that it received a proposal from CAER, reportedly a break-away group of another applicant, Azmar International.
MPLA, which met with both Azmar and CAER’s representatives in the U.S. in early April, had declined to reveal the amount involved in CAER’s proposal.
Meanwhile, Demapan-Castro maintained yesterday that Azmar, which promises to infuse some $46 million for the project, has not shown any solid proof of its financial capacity to carry out its proposal.
“They have not established that they’ve got what it takes. We still need financial information from them,” she said.
The chair said that Azmar merely presented projections based on “an irrevocable line of credit” and purported Swiss bank accounts.
“Give us something that is solid. We can’t verify those—Swiss account, lines of credit, job orders,” she said, adding that MPLA is after capital and security. This means MPLA wants to see Azmar having accounts in any local bank in the CNMI. It also wants to check Azmar’s type of association or business.
Above all, she said that MPLA wants to get security especially when it begins taking pozzolan away from Pagan.
She said Azmar should make a deposit at least $5 million in the name of MPLA in connection with the pozzolan project.
“Issuing them permit is so easy but what’s our guarantee if they begin taking away our pozzolan? We don’t know what would happen out there in the sea. Can we ever recover pozzolan once we lose it?” she asked.
Azmar earlier expressed confidence that it could prove to MPLA that it has money to undertake the project. Azmar insisted that it has actually shown “confidential” documents to prove its financial soundness to MPLA representatives during a recent visit to Phoenix.
It said it submitted those documents again recently to MPLA to show it has access to vast sums of money.
But as of yesterday, the board remained unsatisfied with Azmar’s presentation.
Based on Azmar’s plan, it would spend some $15 million to build roads, a harbor, and other basic infrastructure on Pagan.
It projects to mine and sell 4.55 million metric tons of pozzolan per annum by the third year, and remit required annual taxes and royalty fees to the government.
Azmar said that Pagan has 200 million metric tons of pozzolan deposit, which guarantee continuous mining revenues for the CNMI for nearly 50 years.
This claim has not been confirmed by the CNMI government with a study.
