UPDATE 2-More Philippine mine suspensions on the way in boost for nickel

* May announce ruling on 20 mines facing suspension next week

* Philippines is world’s top nickel ore supplier

* Mines involved produce more than half of Philippine nickel (Adds quote, details throughout)

MANILA, Dec 2 (Reuters) - The Philippine government will suspend more mines in a fight against environmental degradation, the minister in charge of mining said, a move that could put future supply from the world’s top exporter at risk and lift nickel prices.

Nickel on the London Metal Exchange recovered nearly 1 percent from Friday’s lows on the potential for supply disruption after the minister’s comments.

The Southeast Asian nation has already halted 10 of its 41 mines in a campaign backed by President Rodrigo Duterte against what the government says is irresponsible mining. Twenty more are facing possible suspension and the agency in charge of the review may issue a ruling next week.

“There will definitely be suspensions, but we have to go over the list,” Environment and Natural Resources Secretary Regina Lopez told Reuters by phone on Friday.

Lopez said the list will be finalised “very soon, next week at the latest.”

Fourteen of the 20 mines facing suspension are nickel producers, and along with the eight of 10 already halted, they accounted for more than half of the Philippines’ nickel ore output last year.

Nearly all of the output is shipped to China, where shipments of nickel ore and concentrate from the Philippines have dropped 12.5 percent over January-October.

The clampdown began shortly after Duterte assumed office on June 30. He had warned miners to strictly follow tighter rules or shut down, saying the country could survive without a mining industry.


Manila’s crackdown drove nickel to a then one-year high of $11,030 a tonne in August. Last month the metal briefly pierced $12,000 a tonne for the first time since July 2015 in a broad-based rally in industrial metals.

Nickel was down 0.3 percent at $11,175 a tonne by 0757 GMT, but was off the session’s low of $11,080. Analysts say it could top $12,000 again if the Philippines suspends more mines.

“The Philippine ruling on those mines is really the only impetus to get it there,” said Daniel Hynes, commodity strategist at ANZ.

“Further suspensions would see an acceleration in the drawdown in inventories” of nickel from London Metal Exchange warehouses, he said.

The environment agency has pored over responses from the 20 mines facing suspension after they were given show cause letters in October, said Lopez, a passionate environmentalist.

“Our commitment is to the common good,” she said, declining to give more details of the review.

On top of the audit of mines in operation, Lopez said in October that all environmental permits previously granted to mines will be reviewed.

Reporting by Manolo Serapio Jr.; Editing by Tom Hogue