Miningweek july1 14 print

THE PHILIPPINE MINING INDUSTRY'S WEEKLY NEWSPAPER

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6

Mining

Week 6

VOLUME 1 NO. 5

JULY 1-14, 2013

P20

www.phminingweek.com

FEATURED STORYx

More than a drop in the bucket: A Philex-Silangan community love story

See back page

Ombuds raps filed vs Jasareno

ON TOP OF CIVIL SERVICE CASE, SACKED MGB REG’L DIRECTOR ALSO FILED CHARGES IN COMELEC; JASARENO DENIES WRONGDOING x

MGB chief now facing 3 cases courtesy of the MGB-Caraga director he relieved from office x Along with Jasareno, Engr. de Dios seeks suspension of PMO chief for allegedly instigating his relief

S

URIGAO CITY—Engr. Roger A. de Dios has filed has asked the Ombudsman to suspend Mines and Geosciences Bureau (MGB) acting chief Leo Jasareno for allegedly committing corrupt practices.

De Dios, recently the MGB regional director in Caraga Region until Jasareno sacked him in May, said the MGB chief should be held liable for making him defy a court order, and then giving him the boot when he refused to comply.

De Dios has also charged Jasareno with an election offense, pointing out that his relief on May 14 was well within the Commission on Elections ban on movement of government personnel. The Omnibus Election Code, which prohibits the transfer or detail of civil service employees from January 13 to June 12.

FULL STORY ON PAGE 4 k

NONOC NICKEL ROW WIDENS

Shuley now wants MGB chief

cited for contempt x

Case filed following Dir. Jasareno’s order to deny issuance of OTPs and suspend PNPI MPSA in Nonoc x Former PNPI official confirms San Miguel mining unit now in charge of Nonoc mines NONOC nickel miner Shuley Mine Inc. (SMI) has now included Mines and Geosciences Bureau acting chief Leo L. Jasareno on its legal laundry list.

SMI has asked a regional court in Surigao City to cite Director Jasareno for contempt, alleging that the top MGB official has violated an injunction that guaranteed the company’s continued operations in Nonoc.

Jasareno is expected to appear before Branch 29 of the Regional Trial Court in Surigao City on August 2 to answer the charge.

In May, SMI also sought to cite for indirect contempt Pacific Nickel Philippines Inc. (PNPI) officials for allegedly violating the injunction granted by Regional Trial Court Branch 29 on May 6.

FULL STORY ON PAGE 4 k

x COMMUNITIES

Except for sand and gravel, all types of mining now a crime in Catanduanes

IN HOT WATER. Piles of cases have now been filed against MGB Acting Director Leo L. Jasareno in connection with his relief of Engr. Roger A. de Dios. Industry watchers

have opined that Jasareno’s act of giving de Dios the boot for merely following a court injunction had been a terrible miscalculation.

AMMB industry ‘killer,’ says Chamber as backers eye passage of new mining law x

Cancellation of all existing MPSAs and FTAAs a key provision of AMMB x Unwieldy, protracted, repetitive, and impractical, says Chamber of Mines official of certain AMMB provisions AN official of the Chamber of Mines of the Philippines (CoMP) has described the Alternative Minerals Management Bill (AMMB) as “designed to kill responsible mining in the Philippines.”

CoMP Vice-President for Legal and Policy Ronald S. Recidoro made the comment in a paper following the refilling in the two houses of Congress of AMMB, which sought the repeal the

x COMMENT & INSIGHT Oplas: Mining, Markets and Government

x ENZ

Philex firm on duties as gov’t gives green light for TSF3 remediation

SCREEN GRAB COURTESY OF ANC

Roa: Mining, in the late 19th century Philippines

Mining Act of 1995.

AMMB advocates re-filed House Bill No. 984 and Senate Bill No. 43—the two versions of the bill that emerged from House Bills 206, 3763, 4315 and several other mining-related bills in the House of Representatives.

“Passing the AMMB within the next three years is our direction,” Dinagat lone dis-

trict congresswoman and AMMB co-author Arlene “Kaka” Bag-o told Mining Week.

“We’re confident that our bill will generate strong support among the party-list groups in the House and especially from the Liberal Party,” Rep. bag-ao added.

FULL STORY ON PAGE 8 k

MGB-12 head hopeful Socot SP will review open pit ban DAVAO CITY—AMIDST the continuing conundrum over a local environment ordinance in South Cotabato province affecting a copper-gold project, a regional official of the Mines and Geosciences Bureau (MGB) said the national law is superior than local legislation.

MGB 12 regional director Constancio A. Paye Jr., in a press conference during the 20th Annual Mining Symposium in Davao City early this month, said based on several lawyers’ opinion “This is not a question of validity for any local legislation because the local law remains valid until it is revoked or amended.”

FULL STORY ON PAGE 5 k

Comment&Insight Mining, markets and government

O

f all sectors or industries in the Philippine economy, among the most heavily regulated, taxed and intervened by the government are the mining, pharmaceutical and petroleum industries. One proof if an industry is heavily regulated is the existence of high black market presence in that sector.

In the case of mining, it is the so-called “small-scale” metallic mining. In pharmaceuticals, it is the presence of many counterfeit, substandard or simply unregistered medicines and food supplements. In the case of petroleum, it is the existence of huge volume of oil smuggling.

So it is a case where as government intervenes more, supposedly to protect public interest, public health and interest is even more jeopardized for certain sectors of society. There is a universal law to explain this phenomenon and it is not created by Congress or any government department. It is called the “Law of Unintended Consequences.”

The institute that I head, Minimal Government Thinkers, Inc., is an independent and Manila-based free market think tank advocating less government, less taxes, rule of law and free market.

We have been around since 2008 and we saw instances and quantitative data of such unintended consequences to the public.

Large metallic mining in particular is pummeled and heavily regulated not only by the national government – MGB-DENR and BIR-DOF in particular -- but also by municipal, city and provincial governments. And the very vocal and militant NGOs, media, the church and other civil society organizations (CSOs) advocating further regulation if not a ban on large scale mining, they can be eerily silent on the environmental abuses and non-tax payment of many “small scale” metallic mining.

Exposing this double standard if not hypocrisy of those government agencies and CSOs is among our cup of tea. We believe that the main function of civil society is to keep reminding government that its main function in society, its “raison d’etre”

MINE TO MARKET PUBLISHING Mining Week is published weekly by MINE TO MARKET PUBLISHING, with office address at Vailoces Bldg., Capitol Road, Surigao City.

or reason for existence, is to promulgate the rule of law, to protect the citizens’ private property rights, right to life and liberty, and freedom from aggression by lawless elements in society.

So if government imposes various environmental and health standards, multiple taxes and fees, punitive penalties for violators, then those regulations and taxation should apply to all players, big and small, corporate and individual, multinationals and local. Rule of law means no exception, the law applies equally to unequal people, no one is exempted and no one can grant an exemption to the penalties of the law.

If rule of law is strictly observed and implemented in the country, we should see dynamic markets and responsible mining companies, big or small, foreign or local, complying with various regulations, and government regulations would be simple and practical enough, and not assume that only angels, not humans, can do responsible mining.

It is a big disservice to society therefore, if many CSOs will only lobby for strict implementation of those regulations and taxation to large mining and multinational companies, but are silent on the violations on environmental laws and taxes of small-scale metallic mining companies and individuals.

Thus, while large-scale metallic mining have paid about P12 billion in taxes, fees and royalties in 2010, excluding various community and corporate society responsibility (CSR) projects, small scale mining paid zero that year to the BIR and the CSOs are nowhere to hear complaining this big discrepancy in tax payment.

One myth in mining that persists in many sectors, government and private, is that mineral resources are non-renewable and hence, should be kept untapped whenever possible. A review of Earth Science subject in our undergrad years would show that magma or molten rock from the Earth’s core keep finding their way to the mantle and then to the crust, where our land and sea surfaces are located. That is why we have volcanic eruptions and huge earthquakes until now in

many parts of the planet.

This movement of magma and super-hot gases from the core to the crust mineralizes ordinary rocks and soil.

And since such movement is endless and forever, then the creation of mineral products is also endless and forever, especially in the Pacific Rim

of Fire where about 80 percent of all volcanic and earthquake activities occur.

Thus, for technical purposes, the term “non-renewable” mineral resource is wrong.

But since such processes take thousands of years, for practical purposes, that term is considered correct. But ban-

...while large-scale metallic mining have paid about P12 billion in taxes, fees and royalties in 2010, small scale mining paid zero that year to the BIR and the CSOs are nowhere to hear complaining this big discrepancy in tax payment.

ning or strictly limiting mining is a non-option. All materials in modern society – cars and buses, knives and spoon, hammer and nails, planes and boats, cell phones and computers, TV and DVD players, and so on – come from mining. Not one of them came from farming, forestry or fishery. Things that cannot be grown must be mined.

The militant opposition to metallic mining therefore, is plain illogical and hypocritical.

(Bienvenido “Nonoy” Oplas, Jr. is the president of Minimal Government Thinkers, Inc., a group of professionals and small entrepreneurs who believe that free enterprise in a competitive economy will result in a more peaceful and dynamic society.

Nonoy graduated from the

NONOY OPLAS Columnist

University of the Philippines (UP, AB Economics 1985, Diploma in Development Economics 1998). Over the past five years, he has established network and alliances with other free market-oriented think tanks in Asia and other parts of the world)

The Alternative Mining Bill: Killing

T

HE so-called “People’s Mineral Resources Act” is actually a rehash of three near-identical bills filed during the 15th Congress to repeal the Philippine Mining Act of 1995: House Bill No. 206, introduced by Rep. Lorenzo Tañada III; House Bill No. 3763, introduced by Reps. Kaka Bag-ao, Walden Bello, Teddy Baguilat, Jr., Rufus Rodriguez, Maximo Rodriguez, Carlos Padilla, and Roilo Golez; and House Bill 4315, introduced by Reps.

Teddy Casino, Luzviminda Ilagan, Neri Colmenares, Rafael Mariano, Raymond Palatino, Emerenciana De Jesus, and Antonio Tinio.

The bill covers the exploration, development and utilization of mineral resources onshore and quarry resources, excluding offshore mining, petroleum and coal.

Key points of the draft bill include: nCancellation of all existing MPSAs, FTAAs, exploration permits, and all other forms of mining permits, licenses, and agreements (section 165); nGrant of ownership (“private collective ownership”) of natural resources within ancestral domains to indigenous peoples (IPs), contrary to Article XII of the Constitution (sec. 28); nRestrictions on the ex-

traction, development and utilization of mineral resources only to Filipino citizens (Sec. 48). nTransforming the Mines and Geosciences Bureau (MGB) from a permit-issuing body but to a scientific research institution limited only to (non-invasive) exploration, monitoring and regulation of mining operations (Sec. 20 and 25). nEstablishment of a Multi-Sectoral Mining Council (MSMC) tasked to determine whether mining operations should be allowed, deliberate and approve proposals for mineral agreements, issue mining permits, monitor operations, and establish rules of procedure (sec. 39 and 40). nClosing of all areas to mining operations unless opened by the Council as a result of deliberations and processing (sec. 42). nProhibition on open pit mining methods and sub-marine tailings disposal (sec. 59). nProhibition on subsequent transfers of mining rights (sec. 67). nLimitation on the term of mineral agreements to a maximum of 15 years— non-renewable (sec. 58).

During the public hearings called by the House Committee on Environment and Natural Resources, the Chamber

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RONALD RECIDORO Chamber of Mines of the Philippines of Mines raised the following objections to the draft bill: The proposed Alternative Mining Bills run contrary to the principle of State ownership of all natural resources enshrined in Article XII of the Constitution. —The concept of “collective private ownership” by indigenous cultural communities of all mineral resources found within their claimed ancestral lands will place substantial portions of the Philippines outside the scope of the Philippine Constitution and beyond the reach of the State and the Filipino people.

ANCESTRAL DOMAINS OR ANCESTRAL LANDS CONSTITUTE 10 MILLION HECTARES OR A THIRD OF THE ENTIRE PHILIPPINE TERRITORY; AND THE RESOURCES THEREIN, 80 PERCENT OF THE NATION’S NATURAL WEALTH. It would also defeat, dilute or lessen the authority of the State to oversee the “exploration, development, and utilization of natural resources,” which the Constitution expressly requires to “be under the full control and supervision of the State.”

The MGB is the only gov-

NEF LUCZON Northern Mindanao Region

RICHARD BALONGLONG Cordillera Administrative Region

Bong S. Sarmiento Soccsksargen

DARWIN WALLY WEE Zamboanga Peninsula

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ernment agency with the technical knowledge and expertise essential for the rational exploration, development, and use of the country’s mineral resources. — The Alternative Mining Bills propose the creation of MSMCs that will have the power to decide whether an area is open or closed for mining, and thereafter, which mining applicant may be allowed to operate therein.

This organizational framework is impractical, and, given the enormity of the stakes involved, is clearly indefensible. There is no minimum educational or professional requirement for the members. Neither is experience in the mining industry required.

The number of members also appears to be impractical and unwieldy. Unlike the MGB, the MSMCs will not have the same technical capability to make informed decisions involving the areas to be opened to mineral agreements, their terms and minimum capitalization requirements, and other technical requirements, and will NEXT PAGE

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N one of the shelves of the Solhiem Library at the Archaeological Studies Program at the University of the Philippines in Diliman is a rare book printed in 1900 entitled, “ The Inhabitants of the Philippines “ by Frederic H. Sawyer. The author has traveled extensively around the country since the 1880s or earlier and wrote down voluminous notes on what he saw and learned particularly about the rich natural resources that we have.

I was particularly drawn to chapter sixteen about the mineral wealth in the Philippines because it had an interesting description of gold taken from my hometown Cagayan de Oro (formerly Cagayan de Misamis) in 1888.

More on this later.

Sawyer begun this chapter by mentioning the maps

made by two Spanish mining engineers namely Don Enrique Abella and Don Jose Centeno that marked hundreds of places around the archipelago where coal, gold, copper, lead, iron and other minerals can be found. Unfortunately, this was never published and I hope that today, there is at least a copy of that map somewhere.

At the Philippine Exhibibtion, held in Madrid in 1887, Sawyer reported that more than 700 specimens of auriferous earths or sand, gold quartz, and ores of various metals were shown, and in this branch alone there were 109 exhibitors from all over the country. This shows then that at that time there was a sizeable number that engaged in mining operations then.

Besides ore, there were

the tools and utensils used by the miners, models of the furnaces and forges in which the metals were reduced and worked, with the metals in different stages of concentration and manufacture, and a complete show of finished products.

However, it was noted that many mining companies were formed in Spain and in Manila in different times but they were short lived.

The reasons for these failures stemmed from lack of skill, bad management, costly operations or that the reported richness of the vein and seam was grossly exaggerated.

Also, there was difficulty in getting laborers since most of the Filipinos do not care much about the work with exception of the people in Camarines Norte and Surigao.

Another factor to consider

That the Spaniards were surprised at the low intensity mining operations of the Visayans who only went to get gold as needed. But they never saw a Visayan without gold in his person and were experts in this precious metal...

was low wages for a back breaking work.

Gold The early Spanish chroniclers in the Philippines noted that most if not all the islands are rich in gold.

Ferdinand Magellan’s chronicler, Pigafetta, wrote about a man in Caraga (Min-

the goose that lays the golden egg thus likely resolve pending applications on the basis of emotion and/or popular support.

The process outlined in the proposed Alternative Mining Bills for (i) determining the areas open or closed to mining, and (ii) deliberating and approving mineral agreements are overly cumbersome and impractical. — The proposed process is unwieldy, protracted, repetitive, and impractical. Firstly, while Sections 2(c), 26, and 27 of the Local Government Code only provides for prior consultation with affected LGUs and communities, the proposed Alternative Mining Bills have taken it a step further by requiring antecedent unanimous consent by affected LGUs before an area or areas may be opened for mining.

Secondly, while the proposed bills give “guidelines” for the MSMC to consider, the fact remains that the matter will still be resolved by popular vote. Subjecting the question to a vote will not necessarily guarantee that the decision will be the correct one. The standard should always be that the proposed mining activity must have a real contribution to the economic growth and general welfare of the country. Thirdly, the process incorporates a protracted process of repeated consultations and consents from perceived stakeholders that does nothing but discourage investor interest, both local and foreign.

The prohibition on subsequent transfers of mining rights amounts proposed in the Alternative Mining Bills is

an unreasonable curtailment of property rights without due process of law. There is no real reason to prohibit transfers or assignments, especially where the original contractor or permittee is no longer in a financial or technical position to complete his work obligations as outlined in the mineral agreement.

Whatever dangers the proponents of the Alternative Mining Bills seek to address by the prohibiting the assignment or transfer of mining rights are already readily addressed by the Mining Act by requiring (i) that the transferee or assignee be similarly qualified, financially and technically, to undertake the work obligations outlined in the agreement, and (ii) that the transfer or assignment be with the prior consent/approval by the DENR Secretary and/or the President, as the case may be.

Shortening the term of mineral agreements, the removal of fiscal and non-fiscal incentives, and the removal of auxiliary rights will only serve to stunt the growth of the mineral resources industry.—The proposal to shorten the term of mineral agreements (from 25 years down to only 15 non-extendible years), the removal of auxiliary rights, and fiscal and non-fiscal incentives will serve no purpose other than to dissuade any nascent interest by investors. It is thus imperative that we not only retain these existing rights and incentives, but seek ways to enhance them, as well.

Removal/prohibition on full foreign participation and limiting the eligibility

to engage in mining activities only to Filipino citizens or corporations 60 percent of whose equity is owned or controlled by Filipinos is contrary to law and the Constitution.—In the landmark La Bugal-B’laan Case, the Supreme Court ruled that the Constitution allows for foreign participation in the large-scale exploration, development and use of mineral resources through financial or technical assistance agreements with government. The Supreme Court recognized the fact that foreign business entities and multinational corporations are the ones with the resources and know-how to provide technical and/or financial assistance of the magnitude and type required for large-scale exploration, development and utilization of these resources. The Supreme Court even went so far as to declare that the drafters of the Constitution gave their implied assent to everything that these financial or technical assistance agreements necessarily entailed; or that could reasonably be deemed necessary to make them tenable and effective, including management authority with respect to the day-to-day operations of the enterprise and measures for the protection of the interests of the foreign corporation, Provided that Philippine sovereignty over natural resources and full control over the enterprise undertaking the exploration, development and utilization activities remain firmly in the State.

Modifying the government’s share in the mineral

agreement and increasing the same to 10% of the gross revenue, and imposing royalty payments to indigenous cultural communities to 10% of gross revenues is inequitable and confiscatory.—The proposal to increase the government’s share from 2% to 10% of gross revenues will shake the confidence of existing and prospective investors on the consistency and stability of Philippine mining policies.

The extremely high excise tax proposal (set at 10% of the international market price x quantity) is of great concern to the industry. As this tax is set on gross revenues and not profitability, it will penalize lower margin mines. In particular, it will diminish the ability of mining contractors to borrow funds or access financing simply because the chances of incurring financial distress are accelerated by the mechanics of this tax.

The proposed fiscal regime would also net the contractor an internal rate of return (IRR) that is uncompetitive by world standards, considering that mining companies incur huge exploration costs in determining the feasibility of mining projects. A higher IRR for mining projects encourages mining companies to do more exploration work for the discovery of new mines and, more importantly, helps ensures responsible mining practices.

(Mr. Ronald Recidoro is Vice President for Legal and Policy of the Chamber of Mines of the Philippines.

Read conclusion of this paper in the next issue)

danao) that offered a ingot of massive gold for six strings of glass beads. That he saw many gold utensils in the house of the Rajah of Butuan and wrote: “What most abounds is gold. Valleys were pointed out to me in which by signs they made me comprehend there were more lumps of gold than they had hair in their heads, but that, for want of iron, the mines extract greater labor to work them than they feel inclined to bestow.”

French writer Dampier noted that the people of Batanes have no coins but “crumbs of gold that they tied up in banana leaves. They would exchange it for several gallons of drink. They have no scales but did it by guesswork. In 1810, Tomas de Comyn wrote: “Gold abounds in Luzon and many of these islands; but as the mountains which contain it are in the power of pagan Indians, the veins are not worked nor even the mines known. These savages collect it from placers or streams, and bring it as dust to the Christians who inhabit the plains, in exchange for coarse cloth or firearms, and at times, they brought it in grains of an ounce or two in weight.

It is the general opinion that this class of mines abound in the province of Caraga, situated on the east of the great island of Mindanao, and that there as well as various other points, gold is found of 22 carat fine.”

Comyn further stated that the Royal Fifth or rather Tenth (for this was reduced to half since the mines could not pay the fifth)in year 1809 amounted to $ 1144.This would represent an extraction of gold equal to only $ 11,440.00. But Sawyer suspected that the real amount was not reported since he went to Camarines Norte in the late 1880s and was told that the value of gold extracted there was $ 30,000.00 gold dollars.

The author saw women washing sands where speck sof gold can be found in the Province of Manila on a River called San Jose del Puray and was told that they earned 25

6

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Mining, in the late 19th century Philippines A. PAULITA ROA Columnist

cents a day for their labor.

Many groups of men and women in Gapan, Nueva Ecija and Rosales, Pangasinan work for a modest profit washing sands especially after a big storm because the rivers yield a big amount of gold by then.

But the Igorrotes (Igorots of the Mountain Province) have for centuries worked quartz veins or pockets and were known to extract modest amounts so they could buy tools, clothing or cattle.

They were not known to hoard gold for they say it is safer in the mine and placed them in their houses. When one needed to purchase something, all he had to do was go his mine, extract it and immediately purchased what he wanted. they had no thought of the fact that their supply was inexhaustible nor get all the gold in the shortest possible time and sell it.

This is the same attitude of the 16th century Visayans as recorded by Philippine historian William Henry Scott in his monumental book entitled “Barangay” (1994). That the Spaniards were surprised at the low intensity mining operations of the Visayans who only went to get gold as needed. But they never saw a Visayan without gold in his person and were experts in this precious metal that they could tell where it was mined by just looking at it. Juan Martinez wrote in 1567, that they (Visayans) would rather keep their gold below the ground than in cashboxes because they have wars, they can steal it in the house but not in the ground. The wars here refer to looting, Spanish tribute collecting that moved the Filipinos to curtail or even cease their mining productions.

(Ms. Roa is an archeologist affiliated with the UP Archaeological Society. She is the National Museum officer for Cagayan de Oro, where she is a member of the local Historical Commission)

JULY 1-14, 2013

3

MainStories

Shuley now wants MGB chief cited for contempt n FROM PAGE 1 That injunction restrained PNPI and its officers from “impeding”and“preventing”SMI from conducting mining and shipping operations, including the loading and unloading of its ships or barges at the port area in Nonoc Island.

Named respondents were PNPI president Evaristo M. Narvaez; company chief security officer Marlon L. Destajo and OIC resident manager Andres C. Oribe.

In its case against Jasareno, SMI pointed out that it was the MGB chief who ordered the former regional director of MGB-Caraga, Engr. Roger de Dios, to deny SMI’s application for ore transport permits back in May. The company contended that this essentially violated a 2011 writ that prevented Jasareno and MGB in general from dipping their hands on SMI’s operations stopping SMI also recalled that Jasareno also ordered Engr. de Dios last October to stop SMI’s mining operations in Nonoc because Malacañang purportedly wanted it. The memorandum did not cite any particular order to that effect from the Palace, however.

ILLEGAL BLACK SAND MINING IN BABUYAN ISLANDS. Environmentalists and residents decry the illegal black sand mining off Camiguin Island in the Babuyan Channel, saying this has threatened humpback whales in the area. World Wildlife Fund Philippines’ president and CEO Lory Tan says black sand mining will have harmful effect on the area’s biodiversity.

PHOTO COURTESY OF LYCEUM CAMIGUIN

Ombuds raps filed vs Jasareno n FROM PAGE 1 Earlier, the embattled MGB official also asked the Civil Service Commission to reinstate him and invalidate Jasareno’s relief order.

In a phone interview, Jasareno said he would face the charges, but declined further comment because he has not yet received a copy of the complaint.

Along with the relief order, Jasareno also stripping de Dios of all signing authorities—including the authority to issue ore transport permits (OTPs) and mineral ore export permits.

At the center of the case was De Dios’ issuance of OTPs for Nonoc nickel miner Shuley Mine Inc. (SMI), whose mining operation is being opposed by the Privatization Management Office (PMO) but protected by a 2011 court order.

As the entity that manages the government’s interest in the Nonoc nickel mines, PMO persuaded the MGB in 2011 to stop Nonoc mining rights owner Pacific Nickel Philippines Inc. (PNPI) from operating. SMI and PNPI has an existing four-year contract that gave SMI the right to mine, haul and market nickel ores in some 1,400 hectares of PNPI’s 24,000-hectare contract area in Nonoc.

According to the Department of Finance (DOF), PNPI’s parent company Philnico Industrial Corp. (Philnico) still owes PMO some $263 million—a figure that is under litigation between PMO and Philnico before a Makati court.

In her letters to Environ-

4

JULY 1-14, 2013

ment Secretary Ramon Paje, PMO chief Karen Singson indicated that all mining operations in Nonoc should cease, until the issuance of a ruling on the dispute, to avoid further depleting the nickel ores in Nonoc.

This has put MGB in a dilemma because the PNPISMI contract had its stamp of approval, and SMI had been mining for over a year prior to

Unlike Ensomo, de Dios said he complied with the court order for fear of being cited for contempt, which would carry the penalty of fines and/or imprisonment.

In his complaint, de Dios said he repeatedly sought Jasareno’s guidance on the issuance of OTPs to SMI and received no official response.

He said he had his superiors— Jasareno and Environment

Unlike Ensomo, de Dios said he complied with the court order for fear of being cited for contempt, which would carry the penalty of fines and/or imprisonment.

PMO’s complaint.

Nonetheless, the bureau issued a cease and desist order against PNPI and SMI in May 2011. In July of that year, however, a regional court in Surigao City sided with PNPI and SMI with an injunction that prevented MGB and PMO from impeding the mining activities in Nonoc.

De Dios entered into the picture when he was appointed to the Caraga regional office in September last year.

He replaced Director Alilo Ensomo who had refused to heed the court order by declining to issue SMI with OTPs, and was largely believed to have been transferred by the bureau when it was imminent that the court would cite him for contempt.

Secretary Ramon Paje—informed on all the OTPs issued for the Nonoc miner in a series of memoranda, copies of which were attached to the complaint.

Instead of officially communicating the bureau’s position on the court orders, De Dios alleged that Jasareno would only call him to remind him of PMO’s position on the issue.

On April 23, de Dios said Jasareno called and sent him text messages “commanding me to withhold the issuance of permits in favor of SMI, even while the Writ was still in effect, and in violation thereof.”

“Thus, I asked for instructions in writing so that I could have a basis for my actions,

JASARENO

but he refused to provide the same,” de Dios continued.

By their actions, de Dios argued that “Director Jasareno and Ms. Singson wanted me to violate the July 2011 Order and the Writ issued by the Surigao RTC, despite the fact that these orders are validly binding and in full force and effect.”

He said both officials committed “corrupt practice” under Section 3(a) of Republic Act No. 3019, otherwise known as the “Anti-Graft and Corrupt Practices Act.” That provision defines as a corrupt practice the act of “inducing or influencing another public officer to perform an act constituting a violation of rules and regulations duly promulgated by competent authority” De Dios also scored Jasareno and Singson for being indifferent to his plight, pointing out that violating a court order would expose him to legal sanctions.

He said Jasareno’s order did not afford him due process, adding that it did not cite any legal basis and his explanation was not sought. DVAIII

SMI also recalled that Jasareno also ordered Engr. de Dios last October to stop SMI’s mining operations in Nonoc because Malacañang purportedly wanted it.

Clariden now in-charge Meanwhile, Oribe has denied SMI’s charge that PNPI had disobeyed the court.

Oribe also disclosed that PNPI has recently been absorbed

by Clariden Holdings Inc.—San Miguel’s mining unit, the giant conglomerate that plans to put up a $2.5 billion nickel smelter in Nonoc.

It was part of the takeover deal that San Miguel had earlier disclosed, although not much is known about the fine details of the agreement. The deal is still being evaluated by Malacañang.

But because the Nonoc nickel property is still locked in financial and legal quagmire, Oribe said the San Miguel plan may have to wait until next year.

Unaware of PNPI-SMI MOA Oribe also revealed that San Miguel president Ramon S. Ang was unaware that Philnico has an existing four-year Mines Operating Agreement (MOA) with another mining firm, which remains in effect until April next year.

Oribe said Ang was taken aback when in a site visit on April 4, he found out that another mining firm was operating in Nonoc.

Oribe said Ang instructed him and former Philnico resident mine manager Victor Nuñez to immediately stop the operation of SMI, whose 1999 MOA with Philnico granted it the right to mine, haul and market nickel ores in some 1,400 hectares of the latter’s 24,000-hectare concession.

“He (Ang) was worried that the nickel deposits would be depleted long before San Miguel can start constructing the nickel processing plant,” Oribe said in an interview with Mining Week.

Oribe said the task eventually fell on his shoulders when Ang decided to reassign Nuñez in their Manila office and appointed him office-in-charge on the same day of Ang’s visit in Nonoc.

What followed was a court order on April 17 that barred Oribe and other company officials from impeding SMI’s operations, setting off intermittent confrontations between the security personnel of both camps.

Court order disobeyed?

In seeking injunction, SMI alleged that the San Miguel-Philnico group had physically barred its personnel from conducting mining activities in the island. On May 22, SMI filed a petition seeking to cite Oribe and the company’s chief of security in contempt for allegedly violating the court order. Both cases are still being heard.

Oribe, who became assistant manager following his replacement by Engr. Manuel Pallermo, Jr. in May, denied they had any intention to violate the court order. They said his company’s action was consistent with the national government’s position to halt mining operations in Nonoc until “all issues regarding our MPSA (Minerals Sharing and Production Agreement) is resolved.” DVAIII

News

Environment | Communities

MGB-12 head hopeful Socot SP will review open pit ban

BY GIGIE ARCILLAS-AGTAY, Editor-at-large

n FROM PAGE 1 “Only the court can declare that legislation contravenes the national law but then again it (national law) is superior,” Paje said referring to the Mining Amendment Act of 2012.

It can be recalled that South Cotabato province stands firm on the controversial ban on open pit mining even if the Department of Environment and Natural Resources (DENR) has issued an Environmental Compliance Certificate (ECC) to the Sagittarius Mines Inc. (SMI).

Former South Cotabato Governor Arthur Pingoy Jr., a few months before his term ended in June, said the Provincial Government will not back down just because of the ECC approval of the DENR for SMI, which is controlled by Glencor-Xstrata Copper, the world’s fourth largest copper producer.

Paye added that at present, there is a petition for a review of the province’s en-

vironment code particularly Section 23-B. He failed to divulge, however, who filed the petition.

“A review was not made under the administration of former Gov. Pinoy,” he said.

“We just hope that incoming administration officials especially the Sangguniang Panlalawigan will push for a review of that certain provision.”

The issuance of an ECC, Paye said, does not need the endorsement of the local government unit. The ECC is not the permit needed to proceed with the construction of the Tampakan Copper Gold Project (TCGP).

Meanwhile, Paye clarified that the environment impact assessment is only to determine the negative impact of the mining operations in relation to environment and the mitigating measures to address the identified impacts.

“This is not about an endorsement from the LGU. The environment impact assessment is only needed for approval of the Declaration

...the country has one of the biggest undeveloped gold deposits in Tampakan.

of Mining Project Feasibility (DMPF),” he added. “As of now SMI is in the process of securing other requirements for the “declaration”.

The DMPF is a document that gives the go signal to start the construction of the P5.9-billion mining project, he said.

Responsible mining In explaining that mining is not a destructive industry but a contributor to the country’s economic development, Paye said Mindanao is one of the richest in mineral resources in the country.

“In Region 10, where the Tampakan project is located, the proposed site is one of the largest and undeveloped copper deposits in Southeast Asia and the Pacific. Umaabot

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ng 2.9 billion tons of copper ang mayroon doon,” Paye admitted. “Napakalaki ng mineral deposits in Mindanao.”

The Philippines, he said, is No. 3 in the world for gold.

“We are No. 4 in copper, and 6th for granite.

This translates to 873 billion US dollars, almost a trillion US dollars, he added.

Paye went on to say that the country has one of the biggest undeveloped gold deposits in Tampakan.

“If developed, substantial revenues will be generated for as long we will be developing it responsibly,” he said.

“What is paramount is how we develop the area without causing destruction to the environment and provide benefits to the community who are mostly indigenous people.”

The 9,605-hectare SMI Tampakan project, located in the municipalities of Tampakan in South Cotabato, Kiblawan in Davao del Sur, is expected to produce an average annual yield of 375,000 metric tons of copper and 360,000 ounces of gold per year.

On open pit When asked about the

locked legal tussle between SMI and South Cotabato province, which passed an ordinance banning open pit mining in 2010, Paye said open pit is a mining method.

“We have a law -- the mining act of 1995 that allows mining in the Philippines in certain areas. That particular area under question (Tampakan)is open pit mining. So under the law, an open pit mining method is a choice with many parameters like characteristics and nature of the deposits,” he said.

“In Tampakan, ang klase ng bato at deposito requires open pit method.”

MGB Director Leo Jasareno, in a television interview in February, explains that open pit method (or surface mining) is one of two mining methods. The other one is underground mining or sub-classified as block cav-

ing.

“The proposed Tampakan mining site ay nasa ibabaw ng bundok that will need an open pit method,” Jasareno was quoted in the interview.

The 20th Mining Symposium, which is part of an annual activity organized by the Mindanao Association of Mining Engineers (MAEM) in partnership with the Philippine Society of Mining Engineers (PSEM), MGB and other line agencies of the Department of Environment and Natural Resources, was held at SMX Premier in Lanang on June 27-29.

According to Engineer Alex Balogod, MAEM president, the activity aims to impart the social responsibilities of mining engineers and exhaust all efforts to give the necessary information to all stakeholders that mining, if done responsibly, is beneficial.

Meralco, Philex in talks for coal power plant in Surigao PHILEX Mining Corp. and Manila Electric Co. (Meralco) are in talks for the possibility of putting up an 80-megawatt coal-fired power plant in Surigao del Norte, said Manuel V. Pangilinan, chairman of both firms.

Pangilinan said the project is related to Philex’s Silangan project in Surigao del Norte, although no specific investment figures have been provided.

He underscored the need for planned coal-fired power plant “for the mine to proceed and see light of day in terms of commercial operations.”

“We’re investing. Philex continues to invest about P10 billion each year for the development of the mine,” Pangilinan said.

Philex’s Silangan project-

combines the development of the Boyongan and Bayugo deposits, which are comprised of gold, copper and silver.

In Februrary 2009, Philex consolidated its interest in the Silangan project by purchasing the remaining 50 percent equity held by Anglo American Exploration BV and Anglo American Exploration (Philippines) Inc. for $55 million, the company said.

The project is covered by Mineral Production Sharing Agreement (MPSA) 149-99XIII and Exploration Permit (EP) XII-03.

The Silangan project is geared for commercial operation in 2017.

The exploration’s objec-

tives include the formal declaration of mineral resource compliant with the Philippine Mineral Resource Code, the development of the exploration decline aimed at reaching the deposits at depth needed for further assessment, and the initiation of engineering studies and development infrastructure in support of the feasibility study. MW

JULY 1-14, 2013

5

News

Environment | Communities | Mines&Money

Cebu-based firm keen on mining magnetite in Leyte TACLOBAN CITY--While Nicua Mining Corporation put their mining operation in Macarthur, Leyte on hold, Cebu-based Strong Built (Mining) Development Corporation (SBDC) is bracing for full swing magnetite sand mining operation in the town’s farmlands.

The Mines and Geosciences Bureau (MGB) reported that the company has been extracting minerals for testing in preparation for commercial production since last year.

Nonita S. Caguioa, chief of the MGB regional mining environment and safety division said that SBDC was given the authority to extract minerals in 7,411 hectares of lands in Dulag, Mayorga, Macarthur, and Abuyog in Leyte.

The metallurgical testing, according to her, is now concentrated in Barangay San Pedro in Macarthur town, an adjacent villages of Villa Imelda, the site of Nicua Mining Corporation.

“The location is far from Lake Bito and we will make sure that the mining company will abide environmental laws,” Ms. Caguioa said.

SBDC has been operating since 1999 with iron ore, manganese ore, and chromite as their main products. The firm has been enjoying an annual sales volume of one million US dollars according to china. cn website.

In July 28, 2007, the MGB has approved a 25-year Mineral Production Sharing Agreement (MPSA) with SBDC that will expire in 2032.

Last year, Nicua ceased operation due to disagreements with partner Leyte Irons and Mining Corporation.

The mining operation has been blamed by communities as the culprit of massive fish kill as mine waste reportedly reached fishing grounds of Lake Bito.

MPSA is a deal wherein the government shares in the

production of the contractor, whether in kind or in value, as owner of the minerals, and the contractor gets the rest.

In return, the contractor provides the necessary financing, technology, management and personnel for the mining project.

Junior mining firm Northern Access Mining Corporation (NAMI) is also seeking to expand their exploration permit coverage to Macarthur town.

The existing MPSA allows NAMI to explore 50 mining blocks straddling the municipalities of Tanauan, Tolosa, Dulag, Julita, and Tabontabon in Leyte .

“Many areas in Leyte have large deposits of magnetite sand, which has been drawing interest of mining companies,” Caguioa said.

MGB records show that 11 mining firms have pending magnetite sand exploration permit application in Leyte with combined area of 61,209 hectares.

From 1969 to 1976, Inco Mining operated a magnetite mine and processing plant in Tolosa that managed to produce 750,000 tons of magnetite every year and was shipped to Japanese steelmakers. It ceased operation when government imposed strict mining rules.

Magnetite is a magnetic and a very dense mineral of iron. It is an important source of iron for the iron and steel industries but it also has other uses as an industrial mineral to produce many value-added products.

High-grade magnetite is used in many chemical processes including the production of iron sulfate, which is used to purify water in many major cities. Heavy concrete is used for the construction of baffles and containment tanks in nuclear power plants to things as everyday as counter weights in household washing machines. PNA

PHILEX Mining Chairman Manuel V. Pangilinan (in white shoes) leads members of the company’s Board of Directors in a visit to Padcal’s open spillway, June 28.

Philex firm on duties as gov’t gives green light for TSF3 remediation BENGUET, Philippines— Philex Mining Corp. reiterates its commitment to responsible mining, including environmental protection and social-projects implementation, as it welcomes government decision for continued remediation of its tailings pond in Padcal.

“We thank the government for its rational and appropriate move toward our partnership in nation-building and economic progress,” the company’s president and CEO, Eulalio Austin, Jr., said.

“This makes us more resolute in our adherence to responsible mining.”

He issued the statement following a letter by the Mines and Geosciences Bureau (MGB) allowing Philex Mining to continue operating while government has yet to decide on the full resumption of Padcal operations after four months of temporary production or 11 months since the tailings-leak accident last year.

“In view of the urgent remediation measures required for Tailings Storage Facility (TSF) No. 3, Philex Mining Corporation is hereby authorized to continue implementing

Caraga miners affirm support for communities during calamities

RAAGAS

6

JULY 1-14, 2013

CONTRIBUTED PHOTO

SURIGAO CITY—The 27 large-scale mining companies in Caraga Region have been community partners during disasters or natural calamities.

This was disclosed by Dulmar M. Raagas, president of Chamber of Mines in Caraga Region Inc. (CMCRI), as the miners’ group affirmed its support for various disaster preparedness programs being done by local govern-

such remediation measures in the meantime that this Office is thoroughly reviewing the pertinent technical details,” MGB Acting Director Leo Jasareno said in a one page-letter to Mr. Austin.

Austin said Philex Mining had put in place urgent measures to stabilize Padcal’s TSF3, whose ongoing rehabilitation, including the construction of an open spillway, has been successful.

TSF3 had accidentally discharged nontoxic water and sediment on Aug. 1, 2012 through a sinkhole, following two weeks of historically unprecedented rains brought about by typhoons “Ferdie” and “Gener,” which hit Benguet successively.

This prompted Philex Mining to immediately and voluntarily stop its Padcal

operations, provide immediate assistance to the affected households, and implement its remediation and rehabilitation program in connection with the accident.

Mr. Austin said the P327-million open spillway, which is designed to replace TSF3’s underground drainage system, had two of its three chutes done by the end of June. The third chute will be undertaken during the next dry season.

TSF3’s Penstock A and its connecting Tunnel A had been condemned and sealed off with concrete following the accident, while its Penstock B and Tunnel B may still be used if needed, even after the completion of the open spillway.

Once completed, the spillway, whose each chute mea-

sures 12 meters wide and 300 meters long, will be able to channel as much as 1,000 millimeters of rain over a 24-hour period—equivalent to more than two times the 455 millimeters of rain brought about by typhoon“Ondoy” over 24 hours in 2009.

The spillway will drain water from the pond, into which 25,000 cubic meters of fresh tailings have been poured everyday since March 8, when Philex Mining resumed its Padcal operations following a four-month temporary permit issued by the MGB after payment of P1.034 billion in remediation and rehabilitation fees.

Padcal has so far produced at least 2.4 million cubic meters of tailings out of the 3.5 million cubic meters needed to fill up TSF3’s conical void left by the sinkhole and create a beach that would push accumulated water away from the pond and into the spillway.

Third-party experts have said the filling and beaching process was the best, fastest, and most economical way of bringing TSF3 back to itsoriginal condition before the accident. Press Release

ment units in the region.

Specifically, CMCRI is actively involved in partnerships on disaster risk reduction management and emergency response, said Raagas.

Raagas underscored the assistance of mining companies in addressing and respond to the threats of calamities and disaster hazards, pointing out that Caraga remains a calamity-prone region, where flooding and even typhoons visit almost every year.

But while CMCRI’s general thrust is on disaster reduction and control, he said mining companies should

go beyond its role of assisting the LGUs, and must incorporate disaster preparedness programs as part of its social responsibility.

CMCRI members, he said, are assigned to respond according to the location of their respective operations.

“Of five provinces in the Caraga, we have assigned mining companies that will respond. We have Philsaga Mining in Agusan del Sur; Marc Ventures, Carrascal Nickel Corporation, VTC Mining in Surigao del Sur; SR Metals Inc., for Agusan del Norte; Taganito Mining, THPAL Nickel Corporation, Platinum Group Mining

Corporation, Greenstone Resources Corporation and Silangan Mining Corporation among others in Surigao del Norte and Amphil Mining, Oriental Synergy Mining Corporation, Cagdianao Mining Corporation in Dinagat,” he said.

In the past years, he said mining companies have been mobilized to clear roads following landslides, and their equipment are used to transport evacuees. In 2011, mining companies undertook the clearing of roads in Placer after huge boulders from a landslide made the road impassable. RNC

...the filling and beaching process was the best, fastest, and most economical way of bringing TSF3 back to its original condition before the accident.

Environment | Governance | Health & Safety

Online campaign for transparrency in Tampakan project gains ground KORONADAL CITY–The Philippine Misereor Partnership, Inc. (PMPI) has launched an online petition seeking transparency on the money coming from foreign-backed Sagittarius Mines, Inc. (SMI) allegedly to support security measures around the Tampakan copper-gold project area.

A POSTER image of Kiblawan Mayor Marivic Diamante is shown on www.change.org, where a petition for her to be transparrent on the security funds from Sagittarius Mines Inc.

Quarrying operations may affect subterranean river in Puerto Princesa PUERTO PRINCESA CITY,-The management of the Puerto Princesa Underground River (PPUR) and the park that surrounds it is alarmed by the discovery of quarrying operations that might pose a threat to the world wonder of nature site.

Park superintendent Elizabeth Maclang is currently busy stopping the quarry operations allegedly perpetrated by unscrupulous individuals at Cabayugan River, whose water flows through the more than 8-kilometer long subterranean river.

BRIEFLY y Tourism vs mining?

BAGUIO CITY—A government plan to develop the Batong Buhay Gold Mines Inc. in Kalinga may be put on hold because of a proposal to convert sections of the mine into a tourism zone.

Kalinga Gov. Jocel Baac said the government began consultations this week to determine which sections of Pasil town, where the mine is located, should be exempt from as prescribed

by President Aquino’s mining policy.

Aquino signed Republic Act No. 10561 (An Act Declaring Kalinga as a Tourism Development Area or TDA) On May 17.

The Philippine Mining Development Corp. (PMDC) was supposed to begin exploration work in Batong Buhay and had shipped in equipment as early as February.

SMI denies NPA ‘attack’ COTABATO CITY–Communist rebels reportedly stormed the offices of the Tampakan copper-gold project of Sagittarius Mining Inc (SMI) in Davao del Sur, leaving a company guard wounded, police said Monday, July 8.

SMI media relations manager John Arnaldo, however, denied that its facility was the primary target of the attack.

He said the ‘shooting’ appeared to be connected to a dispute among locals.

Philippine Business Bank ventures into mining Philippine Business Bank (PBB) Inc., the financial arm of the Yao

In an interview with Maclang, she said that they discovered the quarrying operations following tip offs from concerned residents.

In their visit last week to the said river with a team from the City Environment and Natural Resources Office (CENRO), they discovered that gravel and sand are being collected along the banks and placed inside sacks ready for transport to buyers.

Maclang said they discovered the collection of gravel and sand were allowed by local officials of Barangay Group of Companies, has dipped into the mining business following its purchase of some 600 million shares of Marcventures Holdings Inc. worth about P980 million last June 20.

PBB, however, did not include in its disclosure to the Philippine Stock Exchange (PSE) the acquisition cost for the mining firm’s shares.

MARC is a holding company involved in nickel mining operations in Surigao del Sur through its subsidiary – Marcventures Mining & Development Corp. (MMDC). Its shares closed trading yesterday at P1.64 each.

The area covered by MMDC’s mineral production sharing agreement is in the Diwata mountain range of Surigao del Sur and covers 4,799 hectares.

Nickel Asia going gold THE MINES and Geosciences Bureau (MGB) has begun processing the application of a subsidiary of listed Nickel Asia Corp. for a permit for a gold mining project in northern Luzon.

The application for a Financial or Technical Assistance Agreement (FTAA) of Cordillera Exploration Company, Inc. -- formerly Newmont Philippines, Inc. -- was filed on Dec. 20, 1994. FTAA, which is for large-scale development, is the only mineral agreement that allows total foreign ownership.

The application covers a total of 77,549 hectares (ha), divided into 57,559.5121 ha in the Cordillera Administrative Region (CAR) and 19,989.4879 ha in Region 1, or Ilocos Region.

Cabayugan, thinking that they were “small time” and only for use of residents who are building and repairing homes.

The team that conducted the inspection with Maclang also discovered that lands covered by the park near the river had been fenced by unidentified individuals trying to claim them illegally.

Maclang said Cabayugan River is part of the restricted zone of the PPUR; this means quarrying is not allowed along the banks.

She said they will be conducting massive information dissemination in the barangay to prevent the destruction of the river that could seriously affect the underground river.

“Our goal is to prevent residents here from claiming lands owned by the government and stop them from quarrying because it can affect the subterranean river.

Erosion can cause its destruction,” she said. PNA

approval or permit for the mining operations of SMI and any monetary gift from the company could be legally constituted as bribery as it compromises the supposedly balanced and objective decision-making of the said municipal government,” Castor said.

The online petition was particularly directed to Mayor Marivic Diamante of Kiblawan in Davao del Sur, one of the towns straddled by the Tampakan project ...

Fr. Oliver Castor, PMPI advocacy officer, said the online campaign was launched late last week after the presentation to the government of the Human Rights Impact Assessment (HRIA) on the Tampakan project conducted by the Institute for Development and Peace (INEF).

The INEF study—funded by aid organizations Swiss Lenten Fund, Misereor and Bread for All—concluded that “it seems today that conducting the Tampakan mine project will not be possible without a serious impact on human rights.” SMI claimed the study “lacked balance, objectivity and transparency.”

The online petition was particularly directed to Mayor Marivic Diamante of Kiblawan in Davao del Sur, one of the towns straddled by the Tampakan project that also covers Tampakan in South Cotabato and Columbio in Sultan Kudarat.

“This practice is highly questionable since the local government unit of Kiblawan is involved in the granting of

In a congressional hearing in this city last February, Diamante and Col. Marcos Norman Flores, commander of the 1002nd Infantry Brigade, both admitted that SMI is giving financial aid to the Armed Forces of the Philippines, through the office of Diamante, amounting to about a million pesos monthly, according to the petition posted at www.change.org.

Castor explained that their online initiative aims to complement the 170,000 signatures gathered by the Social Action Center (SAC) of the Diocese of Marbel from the areas around the mining site.

“Our online petition seeks to broaden the resistance against the connivance of some LGUs, SMI, and the military to protect the mining interests in Mindanao. We aim to include other supporters through an online action as most of the 170,000 signatures gathered by SAC-Marbel came from indigenous and rural communities that do not have internet connection,” he said.

Bishops Dinualdo Gutierrez, Guillermo Afable and Romulo dela Cruz of the dioceses of Marbel, Digos and Kidapawan, respectively, earlier strongly supported the signature campaign of the SAC. Manila Auxiliary Bishop Broderick Pabillo, chairman of the Catholic Bishops Conference of the Philippines’ National Secretariat for Social Action-Justice and Peace, has signed the online petition, and even started his own online petition directed to President Benigno Aquino III to stop the Tampakan project.

Pabillo urged the President to cancel the financial and technical assistance agreement given to SMI, which is now controlled by Glencore Xstrata plc following the merger of Glencore International plc and Xstrata plc.

Diamante could not be contacted for comments on the online petition of PMPI. But John Arnaldo, SMI external communications and media relations manager, earlier admitted that SMI is helping fund the logistics of government forces in the mines development site.

“The CAFGUs are funded by the Community Peace and Security Programs (CPSP) instigated and run by the municipalities of Kiblawan (in Davao del Sur) and Tampakan (in South Cotabato),” he said.

Arnaldo said that both SMI and the LGUs contribute funds to the CPSP. Pressed how much is the contribution of SMI, Arnaldo said “he is not aware” of the amount.

Arnaldo clarified later that “SMI contributes fund to the LGUs as per their request and that it is the LGUs’ discretion to allocate the money.” Bong S. Sarmiento/MindaNews

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7

SecondFrontpage No more tax breaks for new mining AMMB industry ‘killer,’ says Chamber as projects under proposed IPP: DTI backers eye passage of new mining law THE Department of Trade and Industry said new mining projects no longer qualify for income tax holidays but may still import capital equipment at zero duty under the proposed 2013 Investment Priorities Plan (IPP).

“Unlike the 2012 IPP, incentives in the 2013 IPP will be limited to zero duty on any importation of capital equipment, spare parts and accessories of BOI (Board of Investments)-registered enterprises,” the department said in a statement.

BOI Executive Director Lucita P. Reyes said “only mining projects have limited incentives to zero duty importation of capital equipment; there is no income tax holidays for [the sector].”

In a March 26 position paper, the Department of Finance said income tax holidays for some sectors including mining should be removed.

“The proposed 2013 IPP roster includes agriculture/agribusiness and fishery, creative industries/knowledge-based services, shipbuilding, mass housing, iron and steel, energy, infrastructure, research and development, green projects, motor vehicles, strategic projects, hospital/medical services, disaster prevention and mitigation and recovery projects,” the statement read.

The 2013 IPP, which still needs the approval of President Benigno Aquino III. carry much of the same priority areas as the 2012 version with minor changes in some sectors. It also transfers health and medical-related activities from the tourism sector to hospital and medical services “for a more focused classification.” MW

n FROM PAGE 1 A key provision of AMMB is the cancellation of all existing mineral production sharing agreements and financial and technical assistance agreements.

CoMP warned that if passed, AMMB would destroy the industry and make the Philippine mining sector a pariah to investors.

Recidoro said the proposed mechanisms for determining areas open or closed to mining and for deliberating and approving mineral agreements are “unwieldy, protracted, repetitive, and impractical.”

His paper also claimed that the bill’s proposed prohibition of subsequent transfers of mining rights is “an unreasonable curtailment of property rights without due process of law.”

It also criticized the proposed shortening of mineral agreement terms, from 25 years to 15, and removal of incentives and auxiliary rights, as doing so “will only serve to stunt the growth of the mineral resources industry.”

Because AMMB seeks an increase of 2% to 10% in mining share for the government, Recidoro said lower-margin mines would take the brunt “as this tax is set on gross revenues and not profitability.”

He also questioned the proposed removal or prohibition of full foreign participation in mining.

AMMB’s grant of “private collective ownership” of natural resources within ancestral domains to Indigenous Peoples, Recidoro argued, was contrary to Article XII of the Constitution, which con-

Illegal mining, deforestation blamed as Surigao grapples with water shortage SURIGAO CITY– Water became so scarce in this city last summer that people joke that anybody would have difficulty distinguishing a faucet from an antique fixture.

The water crisis, which started in March and peaked during the next two summer months and early part of June, is no joke for Surigaonons who must stay as late as 2 a.m. just to fill all available water receptacles for drinking and cooking.

Water got so scarce during the past two months that not a drop came out from the faucets for three to five days. For the local water utility’s 20,500 subscribers, that meant not only finding new sources of water but willingness to spend more by replacing traditional sources with bottled mineral water for everyday use.

Residents and public officials alike cast the blame on the 25-year-old Surigao Metropolitan Water District (SMWD) for failing to provide a long-term solution to the perennial water supply problem.

In response, the SMWD said short and medium

8

JULY 1-14, 2013

term solutions have been put in the pipeline to improve capacity. Some of these are the construction of new deep wells and the commissioning of new water sources outside the city, according to SMWD General Manager Benjamin Ensomo.

However, Ensomo admitted that the long-term solution to address the water district’s increasing number of consumers lay in the 960-hectare Parang-Parang Watershed— the city’s only source of potable water — whose water capacity level has steadily decreased in the last decade.

In the last four months, SMWD disclosed the water level at the watershed had gone down to a “critical level” —a major factor in the unprecedented water supply interruption that locals had complained during the period.

At the heart of the problem is the decades-old problem of illegal mining at the watershed, SMWD and local officials admit.

SMWD has accused smallscale miners of illegally tapping into the water district pipelines for mining uses.

Water got so scarce during the past two months that not a drop came out from the faucets for three to five days.

Worse, small-scale miners resort to illegal logging within the watershed’s forest to secure timber required to stabilize their tunnels.

When an SMWD-led team tried to enforce a long-running cease and desist order against the illegal smallscale miners in the watershed area in 2005, it resulted in the deaths of four policemen.

Authorities have since identified the area as a flash point where armed smallscale miners are allegedly backed by communist insurgents.

Faced by mounting pressures from SMWD and law enforcement authorities, the miners grouped themselves under the Nagkahiusang Gagmay’ng Minero (Nagami) and filed for a 20-hectare Minahang Bayan application to legalize their operations.

SMWD and the local business chamber opposed the move, noting that the area sought by Nagami encroaches on the watershed’s one-kilometer buffer zone.

Nagami countered that moving away from the buffer zone would serve their “Minahang Bayan” application meaningless, noting that the “high-grade” area has always been believed to be in the disputed area.

Ensomo explained the that buffer zone— although located outside the formal boundaries covered by presidential order declaring the watershed —would ensure that mining activities would not affect the integrity of the water quality being supplied to consumers.

That position has virtually placed the provincial government in dilemma.

Governor Sol Matugas earlier supported Nagami’s application in order to bring the illegal miners’ operations under government regulation, noting that if left unregulated, the miners’ use of mercury and other accompanying illegal activities would pose more danger to the nearby water bodies and the environment.

Due to local opposition, however, the Provincial Mines and Regulatory Board (PMRB) has decided to shelve Nagami’s application.

This has effectively put everything back to standstill: Illegal small-scale miners continue their operations, thus severely affecting water capacity—and potentially, water quality as well—at the watershed even during normal wet season, and SMWD seasonally looking for shortterm, band-aid solutions to appease suffering consumers. DVAII

BAGUILAT

tains the principle of State ownership of all natural resources.

This, he said, would effectively put 10 million hectares or one-third of the entire Philippine territory and 80% of the country’s natural wealth outside the jurisdiction of the Constitution.

The CoMP official also not-

BAG-AO

ed that the new law would reduce the Mines and Geosciences Bureau (MGB) from industry regulator to a research institution limited to non-invasive work.

Recidoro stressed that the current Mining Act already more than adequately addresses the concerns raised by the bill’s proponents. MW

Blaan tribesmen lambaste German human rights study GENERAL SANTOS CITY -- Blaan tribesmen lambasted a human rights impact assessment (HRIA) conducted by a German group as an “insult to the Blaan tribe and its elders”.

Reportedly lacking in facts and based on opinion of a few people with anti-mining sentiments, the study was made in relation to the Tampakan Copper Gold Project (TCGP) project of Sagittarius Mines, Inc.’s (SMI). TCGP straddles the boundaries of the provinces of South Cotabato, Davao del Sur, Sarangani and Sultan Kudarat, which are part of the ancestral domain of the Blaans.

The recent statement, which was signed by the leaders and customary law holders and wisdom holders of the Blaan community, said the HRIA is a “judgement” rather than an assessment, and without “quantitative and qualitative bases.”

“The HRIA written by Bridgette Hamm and her group is an insult to us Blaan leaders, to our elders and to whole Blaan tribe,” the statement added.

The leaders said non-governmental organizations “such as the so-called Tampakan Forum, together with the Catholic Church and its Social Action Center, partnered with the donor agencies that are all anti-mining thus, the results of the study are only products of the opinion of a few people who have previously stated in public their anti-mining sentiment.”

The study was done by

the Institute for Development and Peace (INEF) based at Duisburg-Essen University in Germany, and was commissioned by three Swiss and German non-governmental organizations, namely: Misereor (the German Catholic Bishops’ Organization for Development Cooperation); Fastenopfer (Swiss Catholic Lenten Fund); in collaboration with Bread for All. According to the human rights study, the “human rights to self-determination of indigenous peoples to food, water, health, life and physical integrity are at stake”.

The project would require the destruction of large pristine forests, pose a serious risk to the local water supply, and require the resettlement of approximately 5,000 indigenous people, it added.

The Blaan leaders denied all these saying the statement has a sweeping in its generalization without any basis.

The leaders added that the “HRIA is useless and not credible, but can be used to generate more funds from donor agencies and the governments in Europe for activities that will violate our rights as IPs and destroy a responsible company.”

The study group, they said, also did not secure an FPIC for the conduct of the Human Rights Impact Assessment, thus the report, the author, donor and proponents of the HRIA violated the Blaan community’s right to self-determination they added. SMI Press Release

Environment | Governance | Mines&Money

Miners take a beating at SC over environmental work program SUPREME Court justices bristled at the purported lackluster record of mining companies when it comes to environmental protection during the continuation of the oral argument on the petition to declare the Philippine Mining Act of 1995 unconstitutional. Tuesday, July 16 The magistrates also castigated the Department of Environment and Natural Resources (DENR) for failing to ensure that mining firms in the Philippines have measures to protect the environment from their mining activities.

Chief Justice Maria Lourdes Sereno, reading from a list submitted by the DENR to the high court, revealed that most of the 350 registered mining companies in the country apparently do not have or have not indicated any “environmental work program” (EWP) in their mining concessions with the government.

Sereno added that for the small number of mining firms that have EWPs, the budgets allotted for them

BRIEFLY y Mayor issues closure vs OceanaGold KASIBU Mayor Chito Bumolo issued a closure order against OceanaGold for alleged various violations committed by the company.

Mayor Bumolo issued the order on July 12, though this was expected to be largely symbolic as local government units have limited power over largescale mining operations.

The mayor has accused OceanaGold Corp., which operates the Didipio gold mine in Kasibu, Nueva Vizcaya, of failing to seek and renew its business permit and barangay clearance; failure to pay local taxes; failure to fulfill its promises set in the memorandum of agreement forged with the local government unit specifically with the village where its mining operation is held; and failure to address the human-rights violations complaint filed against its security personnel.

NAC sees drop in ore shipments Nickel Asia Corp. on July 18 estimated incurring a 20-percent drop in the value of nickel ore shipments in the first half of the year largely due to a decline in metals prices.

In a statement to the local bourse, Nickel Asia said sales from its four operating mines fell to P4.14 billion in January to June from P5.18 billion a year earlier.

“We remain in a low price environment on account of slow worldwide economic growth and a growing supply of processed nickel coming from newly commissioned projects,” said president and CEO Gerard Brimo.

“Nevertheless, demand for some of our ore types continue to do well

have had “minuscule” discussion.

For instance, Sereno cited the Nationwide Development Corporation (Nadecor), which only has a budget of P765,000 for environmental protection.

Celestial Nickel, meanwhile, only has a P20,000 environmental protection budget for the 2,800 hectares of land it is mining.

The chief justice slammed the DENR for being “an agency which is not even able to share to the court how much is being spent to protect the environment.”

“Data submitted to us [so far] does not give this court comfort that the posterity of the country is being taken care of [sufficiently],” Sereno told Assistant Solicitor General Magtanggol Castro, who is representing the government in the case.

The oral arguments stemmed from separate petitions filed by former Bayan Muna Rep. Teddy Casiño and Akbayan Rep. Risa Baraquel-Hontiveros in March 2008, contesting Sections 80 and Section 81 of the law on and we are pleased to see continued growth in our shipment volumes,” he added.

The company sold 5.54 million wet metric tons (WMT) of nickel ore, up 10.3 percent from 5.02 WMT in the same comparable period.

NAC said the commissioning of the new Taganito facility is proceeding well and commercial production is slated to begin in the fourth quarter of the year.

The plant is expected to operate at yearly capacities of 30,000 tons of contained nickel and 2,600 tons of contained cobalt starting 2014. The Taganito mine will supply all of the limonite ore for the plant.

Nickel miner to raise P500 million THE BOARD of Oriental Peninsula Resources Group, Inc. approved in its meeting yesterday fresh investments from various firms totaling P500 million, the company said in a disclosure to the Philippine Stocks Exchange on July 15.

The disclosure showed that the investments, via share subscription at P1 apiece, involve P150 million each from King Crown Group Ltd., Yu Rong Ltd. and Fuying Holdings Ltd., as well as P50 million from Laguna Distillery Corp.

In an earlier disclosure, dated July 9, Oriental Peninsula had said it plans to “formally execute separate subscription agreements and/or related documents with King Crown Group Ltd. and Fuying Holdings Ltd. within the third quarter of 2013.”

Oriental Peninsula had also disclosed last July 9 that none of its directors has direct or indirect interest in either King Crown or Fuying Holdings and that “[t]here will be no change in the composition of the company’s board of directors and officers after the transaction.”

Sereno said there was a need to review what has happened to the mining industry since the High Court in 2004 ruled that the Mining Act of 1995 was constitutional

the government’s share in mining operations.

Making things worse during the July 16 oral arguments, Sereno found out that Castro has not gone over the data from the DENR. “You had gone here very strongly defending what has been happening and you haven’t looked at data of the DENR? How can we say you are credible,” Sereno asked.

“If this is the kind of data coming to this court, [then] we have no basis to believe you,” she added. “This has been disastrous for you because you are not looking at the facts and you want us to

turn a blind eye.”

She said there was a need to review what has happened to the mining industry since the high court in 2004 ruled that the Mining Act of 1995 was constitutional.

“You convince this court to restrain itself but we dont have anything to hold on to,” Sereno said.

“Assumptions of La Bugal are out the window. They don’t hold,” she said.

Castro insisted there was no “viable reason to revisit” the La Bugal decision.

Upon questioning from Associate Justice Antonio

SCRAP IT. Bayan Muna stalwart Teddy Casiño joins a multi-sectoral protest supporting the petitioners who seek to scrap the Mining Act of 1995.

PHOTO COOURTERSY OF TEDDYCASINO.ORG Carpio, Castro expressed fears that mining companies might pull out if the high court strikes Section 80 and 81 as unconstitutional.

Associate Justice Roberto Abad emphasized that the high court was not concerned with economics but with the constitutionality of laws.

“The Constitution did not define equitable share. Congress has passed a law to

implement it, but it has not fixed a permanent ratio of mining,” he said.

Associate Justice Teresita Leonardo-De Castro told Castro to include in the memorandum that his camp should later submit to the SC ways on how the government could monitor compliance of the mining firms with the mining law requirements.

Oral arguments are set to resume on July 30. MW

CHINESE INVASION?

Chinese nationals nabbed for illegal mining in various parts of Mindanao SEVEN Chinese nationals have been arrested for illegal mining in the last two weeks in separate locations in Mindanao, where many Chinese-financed illegal mines are believed to be operating.

Many Chinese nationals, who often enter the country on dubious papers, exploit the government’s graft-ridden bureaucracies to engage in small-scale mining operations that are supposedly reserved only to Filipinos. Their operations are characterized by flagrant disregard for environmental laws.

In the town of San Francisco, in Agusan del Sur, local authorities got wind of the illegal mining operations in an upland area when an important tributary in Mt. Magdiwata became polluted.

Police raided the area on July 13 and arrested six Chinese nationals, the Inquirer reported. The identities of the foreigners have not yet been known as only two of them presented identification cards from the Bureau of Immigration, which already expired two months ago.

Another Chinese nation-

al, known as Jason Lu, managed to escape.

Police said two local residents who worked with the foreigners had cooperated and named the suspects.

The residence of the Chinese nationals at the town center was also raided.

Senior Inspector Ephraim Detuya, the town’s chief of police, said the Chinese nationals will face charges for violating the Mining Act of 1995.

On July 15, police in Iligan City also arrested a Chinese national and a Vietnamese for mining gold without a permit.

Chinese national Zhen Huamin, 30, and Vietnamese Phuong Trong Nguyen, 51, were arrested along with three locals in Sitio Baklag, Barangay Rogongon, where they were illegally conducting mining operations.

Meanwhile, Chinese nationals under the cover of small-scale mining permits or Minahang Bayan (people’s cooperative) are reportedly active in the mineral-rich province of Dinagat. Mining Week is currently verifying this information.

In past cases, illegal mining operations involving Chinese nationals were discovered following visi-

ble signs of environmental destruction—destroyed watersheds, silted rivers, coastlines and massive land disturbance.

In the San Francisco case, authorities became aware of the illegal mining activities following the palpable contamination and depletion of the source of potable water and irrigation for rice fields in nearby Barangay Maligaya.

Showing the illegal miners’ utter disregard for environmental laws, authorities confiscated a backhoe used to excavate and destroy the riverbed and banks. They also seized a power-generating set, steel-pipes used to suction water, sand and gravel toward the mine tailings pond, and other mining equipment, according to Inquirer.

Local officials said the mining operation had been going on for over a month on a 24-hour basis. It damaged the riverbanks as the Chinese miners dug up the area with backhoes to follow the gold vein.

It mining operations had caused alarm because it is only a kilometer away from the Magdiwata watershed.

The Chinese miners were also using toxic chemicals as leaching agent, they added.

JULY 1-14, 2013

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News

Environment | Communities | Mines&Money FIRST AID TRAINING. TWENTY-TWO employees from the MGB-Central Office (and 14 technical personnel from the MGB-Regional Offices (ROs) participated in the said 3rd Standard First Aid and Basic Life Support Training, led by the Mining Environment and Safety Division in cooperation with the Philippine Red Cros. The training aims to equip MGB employees with the basic knowledge and skills on first aid and life support techniques. It was conducted from June 3-8, 2013 at the Eurotel Hotel, North EDSA, Quezon City.

MGB PHOTO

Only in the Philippines: Mining now a crime in Catanduanes LEGAZPI CITY--Imprisonment of at least five years and a fine of not less that P10,000 await any person who will be caught doing mining operation in the province of Catanduanes.

These are penalties that an ordinance recently passed by the Sangguniang Panlalawigan (provincial legislative board) provides, as it declared the island as a “mining free” province.

The Catanduanes ordinance is similar to controversial local mining laws passed by several local government units (LGUs) that run counter to the Mining Act of 1995. According to the law, however, only the national government may have sole jurisdiction over large-scale mining operations, and LGUs may only exercise authority on small-scale miners.

Located in the eastern seaboard of the country that is virtually isolated in the Pacific Coast, the province -- although within the typhoon belt -- is blessed with significant landforms and rich forests, thus, it is considered the “last frontier” of Bicol Region in terms of forest cover.

Forest lands of Catanduanes cover an approximate area of 69,770 hectares, or 46 percent of its total land area measured at 1,511.5 square kilometers.

Of this, 69,684 hectares are classified as forest lands while 86 hectares are still considered unclassified forest lands.

Of these, eight percent or 5,876 hectares are dipterocarp old-growth forest; 28 percent or 21,274 hectares, dipterocarp second-growth forest’ three percent or 2,026 hectares, sub-marginal forests; 37 percent or 23,300 hectares, brush land areas; and 30 percent or 22,085 hectares are under other land uses.

These forest areas are the main source of all types of water supply in the province for domestic, irrigation, industrial, hydro-electric power generation and recre-

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JULY 1-14, 2013

ation, among others.

The provincial government also taps the optimum utilization of water that emanates from the watershed to augment the prevailing power crisis in the province by employing additional hydro-electric power sources.

In the light of this situation, the government has set aside large portion of the province’s forest areas into watershed reservation in June 23, 1987 through Presidential Proclamation No. 123.

The Catanduanes Watershed Forest Reserve (CWFR) has a total area of 26,010 hectares that covers Baras, Bato, Caramoran, Gigmoto, San Miguel, San Andres, Virac and Viga -- eight of the province’s 11 municipalities.

ric tons of high-quality coal deposits within an 8,000-hectare land area.

When converted to cash based on the prevailing world market price, this volume would be worth P9.4 billion, a recent report citing a US geological survey said.

This coal area straddles the municipalities of Caramoran, Bagamanoc, Panganiban and Viga -- all major abaca and coconut-producing municipalities that sit at the heart of the island.

In March last year, the Department of Energy awarded a new coal mining contract to the Australian-owned Altura Mining Limited through its local subsidiary, Altura Mining

According to the law, only the national government may have sole jurisdiction over large-scale mining operations, and LGUs may only exercise authority on small-scale miners.

Pursuant to the provisions of Republic Act 7586 or the National Integrated Protected Areas System Act of 1992, the CWFR became its initial component and the Interim Protected Area Management Board organized in 1996.

This significant development for the national concern over environmental protection and biodiversity conservation has opened the gate to explore the opportunities and challenges of managing, protecting and conserving the remaining forest cover and the biological resources in the watershed for the use and enjoyment of the future generations.

The province, however, has become attractive to giant mining firms because of its over-1.2 million met-

Philippines Inc., following its successful bid for the first of three Coal Operating Contracts under the Philippine Energy Contracting Round 4 (PECR4).

The mining site initially covers 7,000 hectares identified as “Area 3 Catanduanes,” the same site covered by a contract earlier awarded by the DOE under the PECR of 2009 to Monte Oro whose operation was called off due to strong opposition mounted by local environmental protection advocates.

The provincial ordinance aims to protect the island’s ecosystem from destruction as well as from the adverse effect of mining, its author, Board Member Giovanni Balmadrid, said in a statement.

It covers as prohibited acts the extraction of valuable

Mining firm hits killing 2 workers in Zamboanga ZAMBOANGA CITY-–The Atro Mining-Vitali, Inc. (AMVI) has condemned the “dastardly act” of killing of its two company executives by still unidentified gunmen as it extends sincerest condolences to their families in this trying time of their lives.

The AMVI said in a statement that they lost competent and hardworking employees, namely: Eng’r. Felipe Nepomuceno, resident manager; and Rommel Dayrit, Assistant Personnel Officer.

The Police Station 1 reported that the victims were having their supper at a roadside restaurant near the company’s office in Sitio Mialim, Barangay Vitali, 83.99 kilometers east of this city, last Friday, July 12, when fatally shot by a motorcycle-riding gunman.

A 16-year-old boy identified as Jaypee Joven was also wounded when he was hit by a stray bullet.

BRIEFLY y

materials or other geological materials from the soil and includes such mining activities as exploration, feasibility, development, utilization and processing large-scale quarry operations.

It excludes, however, legal quarrying of gravel and sand for projects directly undertaken by agencies of the national government or by the provincial government provided that it is for basic services such as -- but not limited -- to roads and bridges, school buildings, water and energy utilities and similar public works.

“Any person, employee or employment agency who violates the provisions of the ordinance will be penalized with imprisonment of at least five years and must pay a fine of at least P10,000 but not more than P50,000,” Balmadrid said.

Moreover, if a violator is a corporation or association, its president and managers or its agent or representative in the Philippines -- in case of a foreign corporation or association -- shall be held liable.

According to Balmadrid, mining must not be allowed in the province to avoid its adverse effect on the environment which includes erosion, formation of sinkholes, loss of biodiversity and contamination of soil and water. PNA/MW

SMI-sponsored mine visit The Soccsksargen Region office of the Mines and Geosciences Bureau Region (MGB 12) has recently sent five employees to visit mine site of Carmen Copper Corporation in Toledo City.

MGB 12 director Constancio Paye Jr. explained “the visit is a project of the Sagittarius Mines, Inc. (SMI) under their Stakeholder Education Program which brings groups and organization to an operating mine to validate the information regarding responsible mining practices, understand the mining process and the technologies used and know how the company and government work together in managing the impacts of mining.” PIA Illegal small-scale mines in Zambales Chromite mining has threatened Mt. Tapulao, which is home to rare plants and animals, said former Zambales governor Amor Deloso.

Deloso said the chromite boulders being extracted from the mountain are “as big as houses.”

Deloso said mining is done on the eastern side of Mt. Tapulao, on the side of the capital town of Iba. “A tunnel which spans 150 meters inside will weaken the base and foundation [of the mountain],” he said.

The office of Zambales Gov. Hermogenes Ebdane, however, has denied that it issued small-scale mining permits anywhere in Zambales.

Likewise, the Mines and Geosciences Bureau (MGB) also said it has not issued any mining permit either in Mt. Tapulao. Both are indications that the mining activities in the area are being conducted by illegal miners.

Oceana Gold gives back BAYOMBONG, Nueva Vizcaya-Mining company Oceana Gold Philippines, Inc.(OGPI) whose operations primarily focus in Barangay Didipio in Kasibu town has already employed 1,700 employees and contractors

The AMVI management lamented the untimely demise of the two employees in the hands of “barbarians who do not appreciate the value of life and the important contributions of the demised employees to the company, in particular, and the community, in general.”

“The company and all employees mourn their untimely passing and will surely miss their presence in their midst,” the AMVI said.

AMVI called on law enforcement authorities to conduct a speedy and thorough investigation on the killings to bring the perpetrators of the unconscionable act to the bar of law.

The AMVI has entered into an Exclusive Mines Operation Agreement with Hard Rock Mineral Trading, Inc. for its Mineral Production Sharing Agreement (MPSA) covering an area of 2,000 hectares in Barangay Vitali, this city. PNA within the project site.

Brennan Lang, Didipio operations general manager, said that since the start of their commercial production of gold and copper deposits in April 1 this year, they had already hired employees, 98 percent Filipinos.

He said the company has an unwavering commitment to its local communities as it continues to work closely with various stakeholders in Nueva Vizcaya and Quirino provinces.

“We have worked conscientiously to develop strong relationships with our local communities in Kasibu, Nueva Vizcaya. This is reflected by the significant number of community members who are directly or indirectly engaged or employed at the mine site,” Lang added. PIA MGB-3 partners with mining firms for geohazard mapping CITY OF SAN FERNANDO, Pampanga--Mines and Geosciences Bureau (MGB) Region No. 3 has inked a Memorandum of Agreement with mining companies to facilitate the completion of assessment and geohazard mapping in key areas in Central Luzon.

MGB Regional Chief Geologist Noel Lacadin said the firms and the respective areas covered are Eagle Cement Corporation in San Ildefonso, Bulacan; Solid North Corporation for San Rafael, Bulacan; Ore Asia Mining and Development Corporation for Dona Remedios Trinidad, Bulacan; Holcim Phil Incorporated for Angat, Bulacan; Lafarge Norzagaray Plant for Norzagaray, Bulacan; Lafarge Bulacan Plant for San Miguel, Bulacan; Luzon Continental Land Corporation for Baliuag, Bulacan; Benguet Corporation for San Antonio, Zambales; Zambales Diversified Metals Corporation for Castillejos, Zambales; Eramen Mineral Corporation for Subic, Zambales; and Filipinas Mining Corp./ LnL Archipelago Mining Corporation for Olongapo City.

MGB Central Office contracted Webcast Corporation who will be conducting the Geohazard Assessment and Mapping for the two cities and 10 municipalities in Pampanga. PIA

Stuffbox

Mining Week aims to highlight in this page the important work that Community Relations officers do in their respective companies. Through pictures and simple words, this corner will give color to community events, company activities and other happenings in mining communities that best demonstrate the fun and colorful side of mining. Contribute now! It’s free!

KCGP join the synchronized tree planting on Arbor day

TVI Resource takes on rice-duck farming in Zamboanga del Sur AS PART of a public-private partnership agreement, Canadian miner TVI Resource Development Inc. and the local government of Zamboanga del Sur an integrated rice-duck farming system in Bayog town, using a Japanese designed system.

TVI Resource allotted P5.5 million to the program as a counterpart to the P6.1 million put up by the Zamboanga del Sur government last February to implement the system in which ducks are used

to eliminate pests and produce natural fertilizer for rice crops.

The miner is currently pre-developing its Balabag gold-silver project in Zamboanga del Sur. Some 3,000 ducks were distributed to rice farmers who also received farm tools, bio-feed and organic fertilizers. Through the project, the farmers were expected to gains additional income by selling ducks’ eggs which they sell for P7 apiece to balut producers who then sell the delicacy for P15 to P18 each. PIA

Training participants with OIC- Assistant Director, Dr. Elmer B. Billedo.

The King-king Copper-Gold Project (KCGP) and two barangays in Pantukan (BrgyKingking and Brgy.

Fuentes) join the “Synchronized Tree Planting Activity” in celebration of the “Philippine Arbor Day 2013” on June 25.

More than 200 fruit-bearing trees were planted in Purok. Caimito, SitioLawaan in BrgyKingking and close to 20 mangrove seedlings in SitioBucana, Brgy Fuentes.

Purok 4 in SitioBucana is the site of KCGP’s adopt-a-mangrove forest project which started December of last year.

In a short program held at Doroteo de Castro Elementary School in SitioLawaan, Kingking’s outgoing barangay captain but Pantukan’s incoming mayor Roberto Yugo, discussed the significance of the activity to the participants as he intends to promote environment protection under his administration. He encouraged everyone to partake in the activity with the sincerest intention to contribute in the preservation of our environment. He stressed that the activity should not be a show off but with great deal of concern on how we can give back to the environment.

St. Augustine Gold & Copper Ltd. (SAGCL) Environment and Permitting Manager Ms. Debbie Ruth Liao-Yasay thanked the barangay council of Kingking for inviting KCGP to join in the tree planting activity. She expressed how willing her team is to participate in envi-

ronment protection activities and wished that there would be more partnerships between the project and the government in the coming days.

“Kami ay nagpapasalamatsaBrgy.

Kingkingsapag-imbitanilasaaminnamagingbahagisaganitongaktibidad. Akoynagagalakna may mgaganitong activities nangsagayonmakapag-ambag kami ngamingkaalamangteknikal at maabotnatinangatinghangaringmaproteksyonanangkalikasan” (We are thankful to Brgy. Kingking for inviting us be a part of this activity. I am glad that there are activities like this where we can contribute our technical knowledge and to achieve our goal to protect the

environment), Yasay said.

SAGCL’s Community Development Manager Jonathan A. Baňez reaffirmed the Project’s continued support in environment protection and all other community development activities, citing the installation of KCGP’s nursery in SitioAyan and other company projects implemented in several areas in Pantukan.

The tree planting activity in barangay Kingking was participated by the barangay council of Kingking, KCGP, students from Pantukan National High School – Lawaan Annex, and purok leaders and barangay functionaries.

All seedlings and on-site preparation were provided by KCGP. Press Release

CROSSWORD PUZZLE

MGB PHOTO

MGB personnel train on use of new survey equipment TO enhance the capability of its personnel, the Marine Geological Survey Division of the Mines and Geosciences Bureau (MGB) conducted training sessions for its central and regional office Marine Geologists on the use of Differential Global Positioning System (DGPS) and Echo Sounder equipment for coastal and marine geological survey.

The DGPS is used to enhance the quality of location data gathered using the Global Positioning System while the Echo Sounder is useful in

studies relevant to riverbed siltation and planning of the remedial dredging efforts.

The training consisted of lectures, actual data gathering, and post survey data processing. The lectures included the procedures on the static and real time kinematics operation of the DGPS and the Echo Sounder, as well as an actual offshore survey using both instruments. The processing of the integrated data from the DGPS and Echo Sounder culminated the course. MGB PRESS RELEASE

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FEATURED STORY

More than a drop in the bucket Reliable water systems continue improving lives in Silangan communities

S

URIGAO CITY, Philippines‹Water was a problem that lasted for generations in a remote barangay in the town of Tubod, Surigao del Norte, where residents practically gave up hope that things would get better‹well, until a Philex Mining Corp. subsidiary came into the picture.

Maximo Cape, a resident of Purok 8, in Brgy. Timamana, remembered well the inconvenience of having insufficient water supply, as serviced by a local, semi-private utility firm, and the hazard posed by the fact that what gushed out of the faucet-if there was any--didn¹t amount to safe drinking water.

“We had no water-rationing schedule,² he said in Filipino. ³We just kept our faucet open and when water did come, we stored as much as we could.

Sometimes we had water and our neighbors didn¹t, sometimes they had water and we didn¹t. Everyday, getting water entailed a big neighborhood effort.

But when Silangan Mindanao Mining Co., Inc. (SMMCI), a part of Philex Mining, began its engagement in communities like Timamana a few years back, the company made sure that improvements in water systems would be a priority in its list of community projects.

Last year, SMMCI engineers Jose Francis Gumapac and John Jay Dionaldo were deployed to the area, to assess and plan for new water systems in the communities.

“Timamana is composed of 520 households,” Mr. Gumapac said. ³But when we inspected its water reservoir, we saw that it was only about 2x2 meters with a height of 1.5 meters. By our calculations, this reservoir could only serve 100 households.”

For his part, Mr. Dionaldo said,

“What Timamana had was a below capacity water reservoir and a poor pipe system. That was the problem we had to resolve.”

Alno Tubo, a community-relations supervisor at SMMCI, said he was also stunned when he first saw the water systems in several mining villages, including Timamana, in Tubod.

“Many of the water reservoirs were small and designed to serve just a few households,” he recalled. ³The pipe systems were crude and old. It was a good thing many decided then to get purified water because what was coming out of their water system carried high coliform content.”

Knowing that their water supply flowed through old and damaged pipelines, Mr. Cape said residents had to buy processed water, which ate up a considerable portion of their already meager resources.

Mr. Cape, who also works part-time as a water and sanitation deputy in his barangay, said the situation was so bad that people there stopped paying water bills, arguing that they should not be made to pay for something which they were rarely getting.

“Since nobody was paying, the problem kept getting worse because we had no money to maintain, much more improve our water facilities,” he added.

These days, however, residents of Brgy. Timamna enjoy strong and steady supply of potable water via their own faucets in their homes. This developed after a series of coordination between barangay officials and Silangan, which constructed a new water reservoir and pipelines in the area. The company even hired residents to help out in the project, enabling them to earn while helping their community.

What SMMCI constructed was a new 4x4-meter reservoir with a height of 3.5 meters, and a capacity

of 48 cubic meters‹enough to serve 1,500 households.

It also built a 1.8-kilometer pipeline from the intake box located in the water source at the SMMCI stockyard all the way to the reservoir.

Mr. Dionaldo said pipelines were also replaced with the ones that could ensure proper distribution of clean and potable water. Each water station line was designed to serve six households to ensure good pressure.

Similar water systems improvements were also done in two other barangays in Tubod, namely San Isidro and Anislagan, whose combined 980 households had experienced poor water supply. About 12 kilometers of pipes were installed through these projects.

Mr. Cape recalled when residents were invited to a barangay assembly about three months ago. The chairman of Timamana announced that the whole barangay would switch to the new watersystem effective May 13, the eve of its fiesta.

“Our people were actually furious,² he said. They were worried that the new system might not work and that would affect their preparations for the fiesta. But water did come and it came efficiently. It was a fiesta that we will never forget.”

Mr. Cape said Silangan¹s support did not end there. The barangay-beneficiaries were given trainings on how to maintain the water facilities as well as briefings on how to set up water bill collection system to ensure that what they now have are properlymaintained.

“We are happy and thankful,” he said.

“People are enjoying the convenience of having good water supply.

Before, we were practically begging for water. Now, many have even started to install showers. We really feel this improvement in our way of life.”

(Clockwise) zAlno Tubo, SMMCI community-relations supervisor, at the new water reservoir whose capacity can serve twice the current needs of Brgy. Timamana, in Tubod, Surigao del Norte. On the right is an old reservoir, which can only provide water for a sixth of the barangay¹s 600 households.

zTwo boys enjoying while washing their feet at a water-distribution station in Brgy.

Timamana, Tubod, Surigao del Norte. The barangay¹s new water system put up by Philex Mining services a maximum of six households per station to ensure good water pressure.

zMaximo Cape showing a faucet¹s strong water pressure inside his home in Brgy.

Timamana¹s Purok 8, Surigao del Norte. Households in his barangay have begun installing showers, which used to be an unheard luxury in the area.