AsiaPhos website

Shares in Phosphate mining company AsiaPhos declined as much as 20 percent to S$0.08 in morning trades on Friday.

The fall in stock price comes after it announced on early Friday that it received a request for undertaking - around November 21 - to vacate and rehabilitate two of its mining sites within the Jiudingshan Nature Reserve in China's Sichuan Province.

AsiaPhos said it does not intend to sign the undertaking and may have to pay a compensation amount of 2.2 million yuan (S$449,680) for the mines if rehabilitation works are not completed by November 30.

With regards to another mine located outside the Jiudingshan Nature Reserve, the company said it was advised by the Sichuan Provincial Authority that the area covered by the mining licence could be inside an area earmarked for a proposed panda reserve.

AsiaPhos still has no access to its Jiudingshan mine due to the work stoppage ordered in June 2017 and has affected its operations at the mine.

The company said it remained in talks with relevant authorities to resume its mining operations.

As at November 23, the Group has sufficient inventories of phosphate rocks and yellow phosphorous to cover its operational needs up to March 31.

The company has terminated the services of employees in its mining department and the estimated cost of the said termination, which amounted to about S$0.1 million, will be recognised in the last quarter of 2017.

At 0400 GMT, AsiaPhos shares were down 15.5 percent at S$0.09. About 9.6 million shares changed hands compared to its 30-day average volume of 5.2 million.