The Melbourne-based company said today it had been advised by the operator of Tampakan, Sagittarius Mines, that the outgoing governor of the South Cotabato province late yesterday formally approved a new environment code that includes a ban on open pit mining on the island.

However, on a positive note, Indophil said the incoming governor had publicly announced that he would order a review of the legality of the proposed open pit ban.

According to Indophil, the Philippine national government has already stated that the provincial proposal contravenes national law and public policy.

With the government in transition following the recent election, Indophil is seeking clarity from relevant government officials and Xstrata subsidiary Sagittarius Mines.

"Indophil and the project managers have had a long-term and strong relationship with the community in the area and we think that should hold strong," Indophil manger corporate affairs Gavan Colley said.

"One would hope a level of effective communication would be put in place to resolve this issue, not only for the good of the local community, the return that goes to the people of the Philippines through the project, but also to the investors."

Tampakan is managed and owned 62.5% by Xstrata through its subsidiary Sagittarius Mines and 37.5% by Indophil.

The company remains in voluntary suspension on the Australian Securities Exchange until no later than July 14 as it seeks further clarification.

Today's news comes after Indophil announced its $A545 million friendly takeover deal with Zijin Mining Group was off the cards.

The company has previously said it would review its options, and open or reopen talks with interested parties.

Shares in Indophil were last trading at $1.095 prior to entering voluntary suspension.