Azmar: No more info until permit is issued

The Arizona-based company seeking to mine pozzolan from Pagan has resolved to stop sending any business information to the Marianas Public Lands Authority until a permit is issued.

Azmar International Inc. president Kenneth James Moore made the statement in reaction to a call by the House of Representatives for MPLA to suspend or revoke any mining permit from Azmar.

Moore said he agreed with Speaker Benigno Fitial that a suspension is required—although not of Azmar’s permit, as it does not have one, but only of Azmar’s business relationship with MPLA.

According to Fitial, MPLA should look deeper into a report that Azmar intended to take possession of historical artifacts that might be found on Pagan. Azmar has denied this, saying that the alleged contract on which the report was based was a false document.

“It is not my intention to argue with Speaker Fitial but the idea of suspending Azmar International’s permit assumes that we have one to suspend. We do not,” he said in a letter. “MPLA made a pronouncement in favor of providing Azmar a permit on Aug. 17, but now, nearly a month later, we’ve received no documentation nor have we heard an official word why.”

Moore acknowledged that this may be caused by a misunderstanding.

“Surely, no one could ask another to put $5 million in a security account, demonstrate an additional $1.5 million cash on hand, provide on top of that a multi-million dollar line of credit and the identity of their clients as MPLA has asked of Azmar, until a contractual agreement has been reached and a permit is in hand,” he said.

Moore maintained that Azmar is ready to comply with all the requirements within the 60-day period set by MPLA. The company only needs a clear authority to act, he said.

He noted that for two and a half years, Azmar has been providing MPLA with volumes of business-related information, including a “how to” pro forma.

“Therefore, I can only agree with Speaker Fitial. A suspension is required. I hereby suspend the flow of further data which could be used by others to do the business Azmar designed until this misunderstanding is finally cleared up and an actual permit issued,” Moore said.

Nevertheless, he stressed that Azmar is not giving up on its plan to mine Pagan.

“Azmar is not throwing in the towel by any stretch of imagination. When this matter is satisfactorily clarified, which I am certain…can be done very quickly and to all parties’ mutual satisfaction, Azmar International is ready to act. We will be here, ready, willing, and quite able to do business,” said Moore.

Don Farrell, spokesperson for Azmar International Inc., said in an interview Tuesday that the company hoped to receive this week an MPLA certificate verifying Azmar’s right to extract pozzolan from Pagan, as well as a separate document stating the conditions that Azmar must provide within 60 days.

He added that Azmar needs only the conditional permit to close a contract with its potential buyer, who agrees to pay a higher price for Pagan pozzolan.

“We simply want our opportunity to prove what we’ve said we can do. The only way we can prove that is to receive a clear permit that we can present to our buyer so that he can sign the contract and sign the irrevocable letter of credit that will give us the cash necessary to be able to implement our plans,” Farrell said.

Members of the MPLA board of directors, however, insist that they did not approve any conditional permit during their Aug. 17 meeting, where Azmar’s application was discussed.

MPLA chair Ana Demapan-Castro maintained that the board’s action was only to give Azmar 60 days to provide all the documents MPLA listed. Those documents, she added, will then be used by the directors as basis in deciding whether or not to grant Azmar a two-year permit.

“If they submit those documents, then we will start negotiating for the two-year permit. But we never gave any conditional permit to Azmar,” Demapan-Castro said.

MPLA board member Nicholas Nekai echoed this, saying that Azmar misunderstood the board’s action. “We know it’s crazy to issue a mining permit when we don’t even have enough information on Azmar’s financial status. And even when Azmar submits all the requirements, we will not automatically give them a permit. We have to review their capability,” Nekai said.

The Aug. 17 MPLA board meeting started with the MPLA chair’s brief remarks about proposals to mine pozzolan from Pagan. She noted that the matter seems to be over-exaggerated in terms of value, and then launched into the various reasons why Azmar failed to satisfy MPLA’s standards.

Nevertheless, she said the investor should be given a conditional approval and allowed to submit the necessary requirements. Board member Nicolas Nekai then read the proposed requirements.
A debate ensued, with board member Benita Manglona raising concern over Azmar’s financial standing. “I’m not sure about making a decision, even to give a conditional permit. I want to make a decision, but I don’t want to be pressured. I’m not convinced that [Azmar’s] financial backing is there,” Manglona said.

Demapan-Castro then called a 10-minute recess. When the board reconvened, Manglona moved to grant Azmar a conditional permit and read a more detailed list of requirements.

MPLA vice chair Manny Villagomez, who was in the Philippines at that time and was participating in the proceedings via teleconference, seconded. The board approved the motion unanimously.