MANILA, Philippines - The country will try to allay the fears of its local officials and push forward mining projects, including a $5.2-billion gold-copper prospect operated by Xstrata Plc, being threatened by a provincial ban on open-pit mining, a mining official said on Tuesday.

Last month, the outgoing governor of South Cotabato signed a law banning open-pit mining in the area, throwing into doubt the Tampakan project, which is considered Southeast Asia's largest undeveloped copper-gold prospect.

"The instruction from Noynoy is that we should attain a compromise," Ramon Jesus Paje, mining secretary, told reporters, referring to President Benigno Aquino III.

"The president has already given us that mandate. It is very important for us."

Tampakan, operated by Sagittarius Mines Inc, the Philippine affiliate of Xstrata Plc, is estimated to contain 13.5 million tons of copper and 15.8 million ounces of gold at a 0.3% cut-off grade.

On Monday, Aquino said consultations were underway to find a "meeting of minds" over the local government's safety and environmental concerns and the jobs, investment and related spending the mining projects would bring to the economy.

"At the end of the day, it's the local government whose voice will be loudest as far as I'm concerned," Aquino said.

"They will be the ones who suffer if there's a disaster. But I will work towards getting them to meet on a common ground that will allay the fears and also afford us the benefits of this investment."

Paje said the government wanted to resolve the issue through negotiations, but it could not stop mine operators challenging the legality of the local law in court.